Cayman-registered beneficial owners accessible to UK

July 4th, 2017

In the beginning of July, the new legislation came into effect in the Cayman Islands that will allow UK law enforcement authorities to access details of the beneficial owners of all financial entities registered in thejurisdiction.

The new technology-based system enhancement to the beneficial ownership regime will allow those with legitimate rights or reasons to have access to do so in a more efficient and timely fashion, with speed being the crucial point. The information is not in a central public register but this is a platform allowing direct access to the RCIPS Financial Crimes Unit so they can respond to requests.

Officials said a system had been in place for more than 15 years that provided beneficial ownership information to the United Kingdom and other countries through legal means, but the new system will increase the speed in which that information is provided.

However, the government has insisted that the system is not very different from the process in place for many years but the efficiency improvement satisfies the UK’s demand for immediate access in criminal cases.

“Financial crime is a serious global problem that requires a unified global response,” Rivers said. “As a jurisdiction, the Cayman Islands continues to play a significant role on international regulatory issues and for implementing global practices to fight financial crime; we have been recognised for decades as a strong international partner in combating corruption, money laundering and tax evasion.”

The UK wanted to have this access back in 2015. As a result, Cayman and the UK agreed in April 2016 to improve the exchange of beneficial ownership information, as outlined in a document called the Exchange of Notes and Technical Protocol. All UK Overseas Territories entered into similar agreements. Since then, Cayman has passed amended legislation, new regulations and guidance notes for industry in order to provide the legal framework upon which the system was enhanced.

Four year AML/terrorist financing plan announced in Cayman

May 29th, 2017

Following the shortcomings identified previously by the Financial Action Task Force (FATF) and in Cayman’s regulatory regime to address emerging threats and vulnerabilities in the financial sector, the attorney general Samuel Bulgin said a strategy has been developed ahead of the next FATF review. In a short statement the government’s chief lawyer, Bulgin said that significant progress had been made on anti-money laundering and terrorist financing but more work needed to be done before that review which will take place later this year.

He said: “The government recognises the need to take ongoing measures to update the AML/CFT regime to address the full range of risks relating to money laundering, the financing of terrorism and proliferation to the Cayman Islands and to communicate its strategy to relevant stakeholders”.

Responding to the threats and vulnerabilities identified in the recently published National Risk Assessment (NRA), a 4-year Anti-Money Laundering and Counter Terrorist Financing Strategy has been developed. According to Bulgin, the strategy will ensure that the jurisdiction has a “robust, adaptive and responsive AML/CFT framework, consistent with international standards, and effective in maintaining the integrity of the Cayman Islands’ financial services system”.

Cayman Hedge Fund conference attracts 530 delegates

April 26th, 2017

GAIM Ops Cayman, one of the largest financial conferences on Cayman’s events calendar, opened on April 24 at The Ritz-Carlton, Grand Cayman.

The leading 3-day conference for hedge fund operations and compliance is bringing 530 delegates from the industry to Cayman for presentations, workshops and networking sessions. The delegates are mostly senior executives, managers and investors in the hedge fund industry by more than 120 speakers.

Sheelah Kolhatkar, author of the newly released book “Black Edge,” on the largest insider trading investigation surrounding hedge fund manager Steven A. Cohen and his fund SAC Capital, will discuss what can be learned from government’s focus on insider trading cases over the last eight years.

Cayman Islands not eligible for 10 Island Challenge funding

April 25th, 2017

The Cayman Islands could still be involved in entrepreneur Richard Branson’s Ten Island Challenge, though the jurisdiction is not eligible for grant funding from the renewable energy initiative.

According to Kurt Tibbetts, Infrastructure Minister, the government of the Cayman Islands has been holding regular talks with experts from Mr. Branson’s program, which provides guidance and financial support to island nations that commit to converting to green energy. There is no financing available to Cayman through the initiative, he said. One of the benefits of being associated with the Ten Island Challenge is that several of the countries that are part of that receive grants.” Mr. Tibbetts said: “The Cayman Islands is not considered to be a part of that, so anything we need then to do we have to ask how much it costs.”

Tourism Minister Moses Kirkconnell first revealed ambitions for the Sister Islands to be part of the challenge in June last year, highlighting the possibility that they could eventually transition to 100% reliance on renewable energy sources. “The vision for Little Cayman and the Brac is that they would be branded as part of the Ten Island Challenge,” he said at the time.

When announcing the Caribbean Transitional Energy Conference to be held in Cayman in May, Mr. Tibbetts said that there is still the ambition for the Sister Islands.

The Dart group, now one of the major landowners in Little Cayman after purchasing Point of Sand, The Paradise Villas hotel, Hungry Iguana restaurant and another 600-acre property in the last few years, is also interested in helping bring renewable energy to the island.

Sir Richard Charles Nicholas Branson is an English business magnate, investor and philanthropist.

CIMA stars creating online payment system

April 12th, 2017

The Cayman Islands Monetary Authority (CIMA) has announced the launch of a fee payment section of the Regulatory Enhanced Electronic Forms Submission (REEFS) system for authorised financial services industry users.

The payment section is being rolled out in 2 phases:

– Phase 1, now underway, allows authorised users to view all applicable due and overdue fees and historical payments. Users can also track relevant fees and sort by groups, such as fee category, due date and covered entity.

– Phase 2, which is expected to take place during the third quarter of 2017, will allow all authorised users to make online payments. To guarantee a smooth transition, users will be provided with the necessary training and guidance on the new fee payment module. This will include instructions on assigning fee payment roles and work flows.

CIMA Managing Director Cindy Scotland said :“Although there is still work to be done before its final stages, I trust that this new service will allow the Cayman Islands to maintain its position as a leading jurisdiction within the global financial services industry”.

Offshore Finance Industry is important to Cayman

March 30th, 2017

Jude Scott, the CEO of Cayman Finance, said that the offshore financial services sector is important to everyone in the Cayman Islands and not just those making a direct living from it.

In Order to get the understanding by the local community at a time when the industry continues to come under attack, not just from overseas but more recently at home as a result of the Legal Practitioners Bill, Cayman Finance has launched a local awareness campaign about the sector.

“The financial services industry has such a positive impact on our community,” Scott said. “We understand it can sometimes be difficult for members of the wider community to see the positive influence the industry has on all residents, but the industry accounts for more than 50% of government revenue – that’s in excess of $300 million each year – which helps to fund education, healthcare, infrastructure, charities and more.”

The finance industry employs over 5,000 people including more than 2,700 Caymanians. And it is not just lawyers, accountants, but also IT and marketing professionals. Also, the finance sector buys services from large, medium and small businesses in other industries in the Cayman economy helping to create jobs indirectly.

Hoping to raise awareness about what the financial services industry does and its impact on the wider community and economy Cayman Finance will be giving presentations to various organisations, associations and businesses within different sectors.

Cayman Premier in London to promote offshore sector

March 1st, 2017

Premier Alden McLaughlin will be promoting the Cayman Islands, including its offshore sector, in London.

The delegation left on March 1 and will return to Grand Cayman on March 8, 2017.

Premier has been invited to deliver an address at a conference at Blackstone Chambers, entitled, “Current Issues in Rule of Law and International Trade and Development”. Also, he will be attending the event hosted by the well-known barristers chambers, to meet with the overseas territories minister, Baroness Anelay, and other British officials.

The conference will be chaired by Blackstone Chambers’ Sir Jeffrey Jowell QC, who advised the PPM during the shaping of the Cayman Islands 2009 constitution. Other guest speakers include Michael Llamas, Attorney General of Gibraltar; Justice Angelica Nussberger, Section President and German Judge on the European Court of Human Rights; and Justice Catherine O’Regan, former member of the Constitutional Court of South Africa and Director of the Bonavero Institute of Human Rights at Oxford.

According to McLaughlin, the conference would give him “an opportunity to say what the Cayman Islands has done in respect of having an advanced bill of rights, an independent judiciary, anti-corruption provisions and how our government has worked to enact and enforce laws against money-laundering and tax evasion”.

LA to tackle a dozen offshore laws

February 22nd, 2017

The financial services minister will be dominating the legislative agenda of the Legislative Assembly with almost a dozen offshore laws set to be debated by legislators ahead of evaluation by the Caribbean Financial Action Task Force (CFATF) later in 2017. The Government of the Cayman Islands is expected to deal with a significant amount of business over the next few weeks before the LA is prorogued ahead of Nomination Day next month and the formal launch of the campaign for the General Election.

Wayne Panton’s ministry has prepared eleven bills, mostly relating to the regulatory framework surrounding new financial services vehicles, and to improve the business environment. Laws such as the Companies Management (Amendment) (No. 2) Bill, 2017; the Companies Amendment (No. 2) Bill, 2017; and the Limited Liability Companies (Amendment) Bill, 2017 are related to creating the framework for the internal beneficial ownership registers in line with Cayman’s beneficial ownership information exchange agreement with the United Kingdom.

Laws such as the Cayman Islands Limited Liability Partnership (LLP) Bill, 2017, which introduces a new business structure designed to increase the attractiveness of the Cayman Islands to professional service providers, are designed to support new financial services vehicles. The Foundation Companies Bill, 2016 is designed to introduce a new type of company that that offers trust and estate planners to what was described as a more satisfactory structure.

The Limited Liability Companies (Amendment) (No. 2) Bill, 2016; the Trusts (Amendment) Bill, 2016; the Exempted Limited Partnership (Amendment) Bill, 2016; and the Tax Concessions (Amendment) Bill, 2016 are designed to delegate the authority of Cabinet to the Cabinet Office for processing tax concession certificates.

Also, the minister is bringing an amendment to the Trade and Business Licensing Law to clarify and extend the Trade and Business Licensing Board’s functions and exemptions for the agricultural sector and to remove the requirement for police clearance certificates for those with an interest in listed or regulated companies, provide proper classification for pay day loans, and allow utility bills to be substituted for bank references.

Last, but not least, and certainly the most controversial, is the Legal Practitioners Bill, 2016, which was deferred for further public consultation from the last meeting. Intended to modernise the regulation of the practice of law, it will also address the Financial Action Task Force (FATF) recommendations ahead of the assessment.

The bills, which can all be found on the government gazette’s website, are as follows:

– the Companies Management (Amendment) (No.2) Bill, 2017;
– the Companies Amendment (No. 2) Bill, 2017;
– the Limited Liability Companies (Amendment) Bill, 2017;
– the Cayman Islands Limited Liability Partnership Bill, 2017;
– the Foundation Companies Bill, 2016;
– the Limited Liability Companies (Amendment) (No. 2) Bill, 2016;
– the Trusts (Amendment) Bill, 2016;
– the Exempted Limited Partnership (Amendment) Bill, 2016;
– the Tax Concessions (Amendment) Bill, 2016;
– the Legal Practitioners Bill, 2016;
– the Trade and Business Licensing Amendment Bill, 2017.

US treasury secretary nominee advised to eliminate Cayman Islands and other tax havens

January 25th, 2017

When questioning the new Trump administration nominee for Treasury Secretary, members of the US Senate, asked Steve Mnuchin how he intends to close down Caribbean tax havens, specifically naming the Cayman Islands.

The senators focused upon the Cayman Islands in showing their displeasure of what they clearly indicated was abuse of American tax laws.

Details have recently emerged how financial service professionals working in the Cayman Islands intentionally use combinations of jurisdictions, like forming a BVI company, owned by a Belize trust, to create a totally opaque, non-transparent vehicle, tax-free, with no identifiable beneficial owner.

After the Panama Papers scandal, members of the Senate and the House of Representatives have affirmed the immediate need for effective tax reform, whether through new legislation or Treasury regulations, to eliminate the present situation. They appear to be looking for the incoming Treasury Secretary for a solution. Political pressure is clearly present on this matter.

Switzerland to implement AEOI Agreement with Cayman

January 3rd, 2017

The Swiss Federal Department of Finance (FDF) has launched a consultation on the introduction of the automatic exchange of information (AEOI) in tax matters with a series of countries including the Cayman Islands.

Besides the Cayman Islands, the countries to implement AEOI agreements include such jurisdictions as the Seychelles, the British Virgin Islands, Bermuda, the Faroe Islands, Mexico , etc.

The consultation will run until March 15, 2017. The AEOI with these countries is to enter into force on January 1, 2018, with the first exchanges to take place in 2019.

Switzerland expects that extending the network of AEOI partner states will help strengthen the competitiveness, credibility, and integrity of Switzerland’s financial center.
Switzerland to implement AEOI Agreement with Cayman

The Swiss Federal Department of Finance (FDF) has launched a consultation on the introduction of the automatic exchange of information (AEOI) in tax matters with a series of countries including the Cayman Islands.

Besides the Cayman Islands, the countries to implement AEOI agreements include such jurisdictions as the Seychelles, the British Virgin Islands, Bermuda, the Faroe Islands, Mexico , etc.

The consultation will run until March 15, 2017. The AEOI with these countries is to enter into force on January 1, 2018, with the first exchanges to take place in 2019.

Switzerland expects that extending the network of AEOI partner states will help strengthen the competitiveness, credibility, and integrity of Switzerland’s financial center.