The law 'Foreign Foreign Account Tax Compliance Act (FATCA)' which demands foreign banks to supply information regarding the banking activities of US citizens, Russia cancel contracts with US clients and US banks may taste a fine.
During 2010 FATCA became a law , the law means foreign banks must comply to reporting information on various US clients. If banks fail to comply there is a possibility they may be hit with a fine.
Banks of Russia have canceled contracts with US clients due to the fact that US failed to oblige to the Compliance Act (FATCA), which requires banking activities within US to be provided.
Russia's negative perception on US decision is evident when Deputy Director of Russia's Federal Financial Monitoring Service - Pavel Livadny, expressed that "We could not put our national security under risk in this case, this is why a rule was adopted, under which every credit services organisation may cancel the contracts with its clients, the US residents, and avoid FATCA regulations this way,".
