I work in finance and it IS a colossal pain to deal with the FATCA compliance.
There is no official guidance to FATCA and its processes, and every country has passed its own FATCA related regulations. Therefore running a FATCA compliant entity in say france requires you to comply with all french laws around fatca. Which also leads to issues with GDPR. This creates a cost of several hundred thousand USD per year just to deal with US clients for most western finance companies, per country they do business in.
Or - simply flatly refuse to offer services to any US citizens and rest easy knowing the IRS isn't going to ruin your life just because a US citizen tried to open an account without even depositing a single cent, but you didn't file your IRS stuff correctly
There is no official guidance to FATCA and its processes, and every country has passed its own FATCA related regulations. Therefore running a FATCA compliant entity in say france requires you to comply with all french laws around fatca. Which also leads to issues with GDPR. This creates a cost of several hundred thousand USD per year just to deal with US clients for most western finance companies, per country they do business in.
Or - simply flatly refuse to offer services to any US citizens and rest easy knowing the IRS isn't going to ruin your life just because a US citizen tried to open an account without even depositing a single cent, but you didn't file your IRS stuff correctly