“Smaller firms struggle with FATCA” says GoldenSource’s Engdahl
As the deadline for the implementation of the FATCA regulation has passed, Steve Engdahl (pictured), senior vice president of product strategy at data management provider GoldenSource comments on the implications.
In many cases, firms appear on track for compliance, only to find some last-minute consideration or requirement that they’ve managed to overlook. We’ve seen a few examples where firms are focused on gathering data on US-domiciled clients but not paid as close attention to US-based securities held by clients, which also fall under the requirement.
As a result, we’re seeing a bit of a rise in urgent – or more last-minute – requests for corporate actions data and information on specific U.S. securities.
From what we’re seeing, tier-1 financial institutions have made the biggest strides towards FATCA compliance. These are firms that are quite disciplined in their project approach They are positioned to detect and escalate impending requirements.
Smaller firms are running much closer to deadlines in terms of getting everything together to meet the baseline requirements. They too might be surprised when they discover pieces that they overlooked.
FATCA is a regulation which impacts global financial institutions and those operating outside the US, however it also applies to US-based securities services firms who provide services to financial institutions with operations outside the US. The deep implications of FATCA may not have occurred to such US-based firms until later in the game, and thus they might also have catching up to do.”