FircoSoft, the leading global provider of watch list filtering solutions, announced today the introduction of a new solution, Firco FATCA, to help financial institutions address FATCA regulations.
The U.S. government's Foreign Account Tax Compliance Act (FATCA) will take effect mid-2013. FATCA requires non-U.S. financial institutions (FFI - Foreign Financial Institutions) and other financial intermediaries to help prevent tax evasion by U.S. citizens. These FFIs include banks, asset managers, and insurers. Failure to do so will incur a 30% withholding tax on U.S. investment flows, irrespective of whether these represent investor or corporate monies.
Firco FATCA enables financial institutions to avoid the tax penalties by performing a detailed analysis of its existing customer base, ensuring any U.S. clients are correctly identified; capturing additional documentation on new customers when they set up an account or portfolio; and reporting to the U.S. or local tax authorities on the “assets” account balance or value held, and “transactions,” the total gross amount of interest or other income paid on the accounts or portfolios of U.S. reportable clients. With Firco FATCA financial institutions will benefit from a dedicated solution that covers the FATCA requirements end-to-end.
“We are very pleased to be introducing Firco FATCA to help financial institutions ensure compliance with FATCA’s new identification, withholding and reporting regulations. Firco FATCA offers a unique solution, by leveraging the advanced data capture and workflow features of recently-acquired Telovia’s Panorama, combined with the filtering capability from FircoSoft,” said France Pioger, Executive Vice President - Acquisitions & Strategic Projects of FircoSoft. “With the regulatory deadline fast-approaching, financial institutions should begin assessing their needs and perform compliance risk assessment as soon as possible to understand the impact on IT, personnel and operations. With the introduction of Firco FATCA we will reduce the time-to-compliance with a comprehensive and effective solution.”
“Firco FATCA solution can be used not only for the general FATCA rules but also for the specific rules deriving from different bilateral agreements,” said René Wack, Head of Compliance & Regulations of FircoSoft. “On September 12th, 2012 the US Department of the Treasury and the UK's HM Treasury signed an intergovernmental agreement to implement FATCA and improve international tax compliance. With Firco FATCA, we will help international financial institutions be FATCA-ready irrespective of the different reporting models, approaches or time frames for compliance.”
Firco FATCA will enable customers to effectively identify, investigate, and report detections. The key capabilities of Firco FATCA include:
· Shareholders identification: Firco FATCA identifies shareholders by accessing external sources like Coface, Companies House, and Schufa, as well as nationality and residency information.
· Filtering and scoring engines: Firco FATCA utilizes FircoSoft’s powerful filtering engine to screen customer data to identify US nationality patterns. The solution’s unique risk scoring engine highlights the most relevant detections.
· Customizable workflows: compliance users can define which workflow to follow according to the results of the detection process. A comprehensive case manager is also incorporated into Firco FATCA.
· Correlation engine: during and after the identification process, customer data is constantly searched to find any correlation with already-detected nationals.
· Automated investigation: after identifying a “candidate” Firco FATCA will perform investigation by automatically collecting evidence from all available data sources (banking systems, internet, newsfeeds, etc.) and storing them into a central database.
· Dedicated reporting: reporting (paper or electronic) will be adapted to the formats required by local or U.S. Tax Authorities, ensuring the bank will be fully compliant with FATCA requirements.