Can an advisor get into trouble for giving technically true—but incomplete—advice? Under FATCA, the answer is yes.

Take the example of Svalbard. Norway has a FATCA Model 1 IGA with the U.S., but Svalbard is excluded from the treaty definition of “Kingdom of Norway.” That means a financial institution in Svalbard could, in theory, be treated as a non-participating foreign financial institution.

The problem arises when an advisor uses that narrow fact to suggest a broader loophole, while leaving out critical context. That transforms a technical truth into a misleading strategy. U.S. prosecutors don’t need the original fact to be false—they only need to show that the advice was reckless, incomplete, or designed to deceive.

In short: advisors can be held criminally liable not just for lies, but also for dangerous omissions.

#FATCA #AdvisorLiability #TaxCompliance #FinancialCrime