FBAR report investment account with a common account number for all participants

[user17568826280]

Hi,

A family member of mine has money in several investment accounts abroad where each account has a common account number that's shared by all its participants. They work just like regular saving account where money can be deposited to collect interest except for not having a separate/unique account number for each individual. They may be similar to mutual fund or pooled fund in concept. How should these accounts be reported on FBAR? I'm thinking he should just report them as if they are individual accounts. However the same account number could be reported by many other people.

Thank you!

[pk]

@user17568826280 ,  are these like informal investment club like structure ?  How does each member know  how much he/she has put in and how much is distributed to him/her?  Is there  like a informal share  value like structure ?  I am assuming that some of the members in any one of these "club" are US persons and others are NRAs for US purposes -- yes ?   or is this like a savings club i.e. the pooled amount is large enough to attract higher interest earnings from a financial institution ( a foreign  financial entity )?  How is this recorded  on the books of the financial entity --- by one person's name or a fictitious "group" name with individual owners un-named ?

Where can I find more info on this ?  What are they called in that foreign country ?    I ask because  while FBAR  / FATCA requirements  define  both the  reporting  requirements  and the types of institutions ( financial etc. ), it  only deals with formal structures including trusts but does not say anything about informal structures like savings clubs or investment clubs --- the latter exists here in the US also.  So any info would be helpful in my search to understand.

pk

[lixiang]

@pk , thanks for your comment. These are formal investment products from very large banks. They provide higher interest rates than typical saving accounts from those banks. These product are typically participated using those banks online app which also tracks balance and intertest. There is a pooled account opened at the bank that is shared by all the participants (i.e. all the participants money are deposited in that account).

A similar product I can find here in the US is raisin.

The person involved is a green card holder. There is no NRA in this.

[pk]

@lixiang  based on your response and example ( thank you -- XieXie )

(a) my reading of  31CFR.1010.350.(c)(3),  these accounts do fall under the reporting regs for foreign accounts -- for both FBAR and FATCA. 

(b) Since the reporting person is a US person, has signature / operational authority over his/her portion of the pooled  account  ( one  multi-person account that has investment/deposit in multiple subaccounts), he/she comes un der reporting requirements of FBAR and FATCA. 

(c) For both FBAR and FATCA reporting the US person needs to report his/her participating amounts --- the fact that others may report using the same account number / institution is not material ( IMO) because what one is attesting to is the fact of having financial ( liquid or semiliquid ) interest abroad, even if the foreign financial entity reporting includes the whole pooled amount with a list of participants ( i.e. not reporting the value of each individual participant holding in the pool ).  It may be somewhat fuzzy reporting but here the onus is on the US person holding a share of the pool.

(d) This also means that the US person must be recognizing the earnings from such pooled accounts  whether distributed or retained.

Does this make sense ?

Is there more I can do for you ?

[lixiang]

Thanks @pk , your comment makes sense.

If I understand correctly, he will report using the shared account number with his deposited amount?

[pk]

@lixiang , yes indeed.