UK enforcement agencies to visit Cayman

(CNS): The UK is expected to send law enforcement officials to Cayman in the New Year to enhance the current cooperation regime between this jurisdiction and the authorities in Britain regarding financial crime and money laundering. Financial Services Minister Wayne Panton said that experts are coming at Cayman’s invitation to “improve on the collaboration” on global financial crime investigations and to look at local resources, response times, the accuracy and level of information.

He said the goal was to improve collaboration, although there have been no complaints from the UK about the local system. “Our perspective is that we will not facilitate improper activity and we don’t want to be a jurisdiction where serious fraud and corruption as well as tax evasion is facilitated,” Panton said.

Insistent that Cayman is no longer the type of jurisdiction used to hide money because it has moved well away from the concept of the “Swiss model of offshore banking secrecy”, he said Cayman had instead moved towards institutional business, rather than hiding the cash of the very rich.

While it was not possible to say that it still didn’t happen, as the jurisdiction has evolved the message had been made clear that if you want to evade tax or hide ill-gotten gains, don’t come to Cayman, the minister said, noting that tighter regulation has attracted a new kind of business to the islands.

But to ensure that dirty money is not held here Cayman must stay ahead of the game, Panton explained. The British representatives had been invited to improve the system, which is already working well, he said, and implied that the visit was more about satisfying misconceptions in the UK than dealing with any actual problems here with the mechanisms that allow UK law enforcement access to information in Cayman during criminal probes.

“The Cayman Islands is not open to business to those who want to abuse a system for criminal or for tax purposes,” Panton said, pointing to possible further enhancements in the system to make sure.

He said having dedicated staff in Cayman that work directly with the UK authorities would give the UK agents comfort that they have a direct line of communication or “go to people” here when needed. “We have every confidence in our team, so we have said to the UK that they can come and have a look at the current system for sharing information for criminal investigations,” he said.

Response time appears to be an issue that the UK has raised but Panton explained that this can vary wildly, from days to months, because in some case the information the law enforcement agencies require is not in Cayman but elsewhere, slowing now the flow of information.

Suspicious activity reports (SARs) are increasing because business in the offshore sector is growing, Panton said the financial services authorities are passing information all the time to other jurisdictions when red flags are raised but very few lead to local criminal investigations. Answering the criticism over the lack of convictions for money laundering and other financial crimes in Cayman, Panton said that was because more often than not the actual crime took place in another jurisdiction.

He said Cayman’s success was that SARs are made frequently, triggering probes elsewhere, and the system was working well. It was the culture of compliance in Cayman, he said, that was part of the jurisdiction’s offshore success story.

Tags: Featured, tax evasion, tax haven, Tax Information Authority, Wayne Panton

Category: Finance, Financial Crime, Financial Services