A Banking Option For Gringos

Now you can open an account with the State Department

Americans living abroad have an unusual and costly problem: Financial institutions are reluctant to take their money. And that can be a pain in the ass if you’re working down here and have no place to stash your money other than your mattress.

A federal law that went into effect in 2014, which was designed to deter money laundering and tax evasion, imposes strict reporting requirements on foreign financial institutions that hold U.S. assets. So rather than risk a stiff penalty – 30% withholding on their transactions in the U.S. – for violating the rules, many foreign banks have refused to do business with American expats. Making matters worse, some U.S. based financial institutions have restricted services or closed the accounts of Americans who don’t have a permanent U.S. address.

But now, with a new type of bank account created by the State Department Federal Credit Union and the non-profit organization American Citizens Abroad, us Gringos finally have some banking options down here. An agreement reached between the two last year allows any ACA member to be eligible to open an SDFCU account. The SDFCU has been working with expats for years, offering accounts to Americans who work in embassies and other locations abroad.

Membership in ACA costs $70 USD a year, $55 for seniors. You don’t need a U.S. address to open an account, and you don’t have to be a federal employee. You’ll be able to conduct transactions all over the world in U.S. dollars, pay your U.S. taxes electronically, and retirees can arrange to have their Social Security benefits deposited directly into their accounts.

For more information, visit www.americansabroad.org/sdfcu-account/.