Deutsche Bank said it terminated securities accounts held abroad by people with U.S. residency as of mid-2011. The action didn't include checking or savings accounts and didn't affect citizens living outside the U.S. The Frankfurt-based bank said "only a small number of customers" were affected.

Spokesmen for Credit Suisse, France's BNP Paribas SA and Amsterdam-based ABN Amro Bank NV, also among the top 10 non-U.S. global wealth managers, said their banks are studying the issue and haven't decided what to do with American account holders.

Collateral Damage

"Bank accounts, investment accounts, mortgages and insurance policies are being refused to American clients, and those with accounts are seeing them closed or have been threatened with closure," Marylouise Serrato, executive director of American Citizens Abroad, a Geneva-based organization, wrote in an e-mail.

U.S. citizens who live in countries that aren't served by U.S. banks may find themselves unable to bank at all, and implementation of the law in its current form could cause collateral damage to American businesses abroad, she said.

"Americans either will not be allowed to enter into international partnerships or live and work overseas, and will be replaced by foreign nationals who do not have these limitations," Serrato wrote. "The extensive reporting requirements of Fatca will be destructive to those who wish to do business internationally as well as to those Americans who are legitimately living and working overseas."

'Turned Away'

That view is shared by Richard L. Weisman, Hong Kong-based head of law firm Baker & McKenzie LLP's global tax practice.

"U.S. expatriates already face severe U.S. tax rules related to their non-U.S. income and investments," Weisman said. "Fatca will increase the extent to which they are turned away by non-U.S. financial institutions."

Tan of DBS said she refers Americans seeking private- banking services to U.S. institutions with operations in Singapore such as Citigroup Inc., Bank of America, Morgan Stanley, Goldman Sachs Group Inc. and JPMorgan Chase & Co., which are able to open securities accounts for Americans because they're regulated by U.S. authorities. Such accounts allow purchases of investment products without restricting Americans to cash and time-deposit accounts.

While that may be easy for Americans in Singapore, those who live elsewhere face obstacles. Before Fatca, U.S. citizens in Bangkok or Manila could find investment opportunities through non-U.S. banks such as HSBC. Now their only option is to fly to cities where U.S. firms operate.

Limited Choices

If Americans choose to bank with a non-U.S. firm such as HSBC, their investment choices are limited. At the HSBC branch in the bank's Asia regional headquarters in Hong Kong, Americans can hold only savings deposits. They're prohibited from opening accounts to trade local stocks or buy products available to non- U.S. customers, including 45 equity funds investing in China or other geographies and industries. There's only one comparable emerging-markets equity option available on HSBC's U.S.-based investors' website.