(CNS Business): The former chair of the Alternative Investment Management Association (AIMA) and hedge fund industry veteran, Todd Groome, has joined Highwater Group’s specialist corporate governance team. The local firm, which provides independent directors and other corporate services to hedge funds and global investment managers, said he would contribute significantly to the depth of its director bench. Groome was described in a release as having some 28 years of experience in international financial markets, working in both public and private sectors and across geographies.

(The Telelgraph): Super-rich hedge fund financiers emerged as the big winners from the Bank of England’s money printing programme in 2012, as pensioners and savers were made to struggle with shrunken incomes. Much of the high-rolling industry bet that quantitative easing (QE) would boost global markets and those that stuck to the strategy made record profits. Hedge fund expert Philippe Bonnefoy said: “The masters of equity and credit trading strategies have done their homework in 2012 and reaped benefits turbocharged by an ocean of government-sponsored liquidity.” The industry’s success will sit uneasily with savers and pensioners who have been condemned to rock bottom interest rates and reduced annuity payments caused by QE-induced low gilt yields.

(The Economist):  The past year has been another mediocre one for hedge funds. The HFRX, a widely used measure of industry returns, is up by just 3%, compared with an 18% rise in the S&P 500 share index. Although it might be possible to shrug off one year’s underperformance, the hedgies’ problems run much deeper. The S&P 500 has now outperformed its hedge-fund rival for ten straight years, with the exception of 2008 when both fell sharply. A simple-minded investment portfolio—60% of it in shares and the rest in sovereign bonds—has delivered returns of more than 90% over the past decade, compared with a meagre 17% after fees for hedge funds. 

(CNS Business): Although Richard Coles fell short of asking for the premier’s resignation in a statement last week, the chair of the local financial industry body was quick to offer his support for the ousting of Premier McKeeva Bush yesterday evening following the opposition leader’s successful no confidence in government motion. Shortly after Bush and his government were ousted from office, following his recent arrest by the local police and the resulting split in the UDP loyalty for their leader, Cayman Finance repeated the message that the industry remains independent from government and that it would not be adversely affected by the country’s political turmoil.

(CNS): Following his own appointment as a senior partner of the newly reformed legal firm Travers Thorp Alberga, the outspoken former chair of Cayman Finance and chair of the local stock exchange, Anthony Travers, has made his first major hire. Travers has recruited Nicole Pineda, a former partner at Walkers, where she was responsible for the development and management of its Latin American Finance practice. In what the firm called “a major coup”, Pineda, who left Walkers more than six months ago, is now behind a desk at her new job and will be the partner in charge of its newly formed Latin American group.

(CNS Business): A new report claims that around $858.8 billion flowed from the developing world into offshore tax havens in 2010, as a result of crime, corruption, and tax evasion. A new study released Monday by Global Financial Integrity (GFI), a Washington-based research and advocacy organization, said the illicit outflow in 2010 is a significant increase on the money lost in the previous year, which saw developing countries lose $776 billion. The study, "Illicit Financial Flows from Developing Countries: 2001-2010", estimates the developing world lost a total of $5.86 trillion over the decade.

(CNS Business): The Tax Justice Network has unveiled a blueprint for a 21st century system for taxing multinational companies to replace what is called the current thoroughly discredited model. The group, which campaigns against international corporate tax abuse, said the governing principles underpinning international tax are fundamentally flawed and governments' efforts to fix the problems are nothing more than attempts to patch up an outdated international system that is beyond repair. The group is calling for a system where profits are apportioned to the countries where real economic activity occurs rather than in tax havens.

(CNS Business): The Cayman Islands’ chief justice has said that the jurisdiction is “front and centre” on the world stage of insolvency litigation. Anthony Smellie said that the local profession had helped to define Cayman as a jurisdiction of choice for the resolution of disputes, not least because of the certainty and predictability of results here and from the timely and effective resolution of the many difficult issues in the cases. Giving the keynote at the Recovery and Insolvency Specialists’ Association’s inaugural training event last month, he said the new organisation was timely, coming as it has on the crest of the largest wave of insolvency litigation Cayman had ever seen.

(CNS Business): The Cayman Islands insurance sector experienced its busiest year for new business in recent memory, a regulatory official reported recently. There was a 57 percent increase in license applications in 2012 over the same period in 2011 and existing licensees have surpassed the $88 billion threshold when it comes to asset growth. According to the Cayman Islands Monetary Authority (CIMA) Head of Insurance Supervision, Gordon Rowell, the forecast for the future of the Cayman insurance industry is bullish. He said a combination of excellent personal attention provided by local service providers and the implementation of the new Cayman Islands Insurance Law were helping boost the sector.

(CNS Business): Carey Olsen has officially opened its new office in the Cayman Islands following an announcing in June that it intended to set up the new facility. The Channel Islands law firm already has offices in Guernsey, Jersey and London, and lead partners Jason Allison, Nick Bullmore, Jarrod Farley and Anthony McKenzie will develop the Cayman Islands practice. The four lawyers specialise in corporate, finance and investment funds work. The firm has more than 150 lawyers and has expanded because of increasing demand for the provision of Cayman Islands and British Virgin Islands legal advice from its clients.

(Reuters): Britain's Serious Fraud Office (SFO) has charged Magnus Peterson, the founder of Weavering Capital, with fraud and forgery, just months after reopening its investigation into the collapsed $600 million hedge fund. The SFO said on Friday Peterson was charged with six offences, comprising two of false accounting, one of fraudulent trading, one of fraud by abuse of position and two of forgery. Investors were left with hundreds of millions of dollars of losses when the Weavering Macro fund, run by Swedish national Peterson, 49, collapsed during the credit crisis. The SFO made two arrests in May 2009, but then dropped its initial two-and-a-half-year investigation last September, saying there wasn't "a reasonable prospect of conviction".

(CNS Business): As the UK plans to move towards automatic exchange of tax information with its dependent territories, dubbed "son of FATCA", two of the its crown dependencies have said they do not want to sign up to such an agreement unless it is a global regulation. While the Isle of Man has signalled its agreement, officials from the financial offshore centres of Jersey and Guernsey, which already have tax information exchange agreements with Britain, said they are reluctant to agree to the UK’s new regulation, similar to US Treasury's Foreign Account Tax Compliance Act (FATCA), which would make exchange automatic. The chief ministers of Jersey and Guernsey said in a statement issued to the British and local media this week that the islands would be put at competitive disadvantage.

(CNS Business): Around fifty visiting cruise ship passengers caused something of a stir in George Town Thursday afternoon with a demonstration outside Ugland House, the home of legal offshore specialists Maples and Calder. The protesters were traveling with the US based magazine The Nation on a special cruise and social justice group CODEPINK took the opportunity to highlight what is seen as the injustice of large companies being able to avoid paying their fair share of taxes in the countries they are headquartered because of the use of tax shelters. Tighe Barry, a film and TV producer and a member of the demonstration, said the target of the protest was the American government and not Cayman as he said he was well aware it is a tax free jurisdiction.

(CNS Business): In the wake of the premier’s arrest this week in connection a number of investigations, including financial irregularities, the body representing the Cayman Islands' financial industry has stressed the independence of the sector and its regulators from the government. Distancing the offshore business from the political arm of the government, Cayman Finance said it had taken steps to ensure the interest of Cayman’s financial services industry was well represented and that the body had been dealing with international media enquiries. It added that any change of leadership would not affect the workings of the administrative part of government or the regulator.

(CNSBusiness) The Isle of Man has confirmed that it will be adopting tax information sharing arrangements with the United Kingdom that will closely follow the FATCA intergovernmental agreement currently being negotiated with the United States. Allan Bell, the country’s chief minister, said Friday that the “nature of tax cooperation is changing” and “automatic exchange is becoming the global standard.” He said that his government would work closely with the UK to enhance tax transparency in an effort to combat not just financial crime but tax evasion as well. The so-called "son of FACTA" is causing ripples in the offshore world but so far the Cayman government has remained silent on the issue.