Cayman says no to public access to ownership

(CNS Business): The Cayman government, along with other affected British territories, has refused to introduce a centralised beneficial ownership register with public access. Premier Alden McLaughlin said Monday that he and Financial Services Minister Wayne Panton, with the support of other territory leaders, stood firm last week in London when on the last day of the Joint Ministerial Council the UK attempted to make the overseas territories and crown dependencies agree to introduce such a register, which would eventually be made public.

“I, together with Minister Panton, remained firm when I again stated our position and I am pleased to say that so far the OTs and CDs stand united on this issue,” the premier said, as he announced that the status quo regarding the current system of collection and continued protection of information would remain.

In a statement to the Legislative Assembly on Monday, reporting back to his parliamentary colleagues and the broader public, McLaughlin said the UK had been pressing its territories and dependencies to consider implementing a central registry and or a public register on beneficial ownership of legal entities.

“We have completed a survey of businesses regarding this issue and a majority of the responses, as expected, indicate firmly that a central registry is unnecessary and that a public registry would spell disaster for our financial services business,” he said. “Unless such registers become the new global standard and are being used by all major players – Including the UK – then neither we nor any other OT or CD intend to go first and have our economies experimented with and potentially damaged.”

Referring to his trip to London in February, when he gave a keynote address at Chatham House followed up by an interview on the BBCs Hard Talk programme, he said, “I was speaking very plainly when I said that Cayman is ahead of the UK when it comes to knowing the beneficial owners of companies.”

McLaughlin added, “I was also plain speaking when I said that Cayman would not participate in any initiative such a public register of beneficial owners without this being a global standard that all would follow and indeed was actually practicing. I have repeated this at every discussion with the UK, including with former Minister Simmonds when he visited Cayman last year. And we continued this stance during the JMC planning sessions with the UK prior to the meeting.

He said that the other territories had also all examined and were in agreement with the ‘10 Principles on Beneficial Ownership’, as agreed at the recent Brisbane G20 Summit, one of which is that countries should ensure that authorities, including law enforcement and prosecutorial authorities, supervisory authorities, tax authorities and financial intelligence units, have access to adequate, accurate and current information regarding the beneficial ownership of legal persons.

“We are firmly of the view that our current system has worked effectively and efficiently for a very long time and it meets the above criteria very well,” McLaughlin said. “And many of our fellow OTs and CDs feel the same way about their own regimes and, as I noted, we stand united on this issue. Hence we see no need for a central registry that would increase cost to business and the country and also create a potential single data source, which motivated and skilled individuals could hack into for gain.”

He added that any mechanism that achieved the same outcome to quickly and efficiently provide law enforcement with information on beneficial ownership of entities that may be involved in criminal activity would meet the G20 principle.

“Our systems do this now, as I have said, and it works well, though we intend to improve on that system to further improve efficiencies,” he said.

The premier pointed out that none of the G20 countries have a public registry, not least because it was a bad idea, and he said that aside from the UK, no one is likely to implement one.

“And neither will the Cayman Islands,” he told the LA.

He pointed out that in the JMC communiqué the CIG and other OTs had agreed to jointly work to raise international standards to tackle money laundering, tax evasion, illicit finance and corruption. The premier said that the matter would be discussed with the UK prior to the upcoming G20 Summit.

“In the interim we will discuss this again with industry stakeholders to ensure that their views have not shifted. If it has not, then we intend to again stand firm,” the premier promised.

Tags: Alden McLaughlin, beneficial ownership, British Overseas Teritories, Featured, UK

Category: Finance, Financial Services