Industry body embraces new BO regime
Jude Scott, CEO Cayman Finance
(CNS Business): Cayman Finance, the association representing the local financial services sector, has offered its support to government’s deal with the UK over an enhanced regime for sharing information about the real owners of offshore financial entities. Cayman Finance CEO Jude Scott said they had worked in collaboration with government to bring expertise to the UK talks. Describing the agreement as a “milestone but not the end of the road”, Scott emphasized how adhering to regulation and global standards has fueled the jurisdiction’s success.
Scott said the latest agreement was a significant step in showing that Cayman was not a secrecy jurisdiction but a premier global financial hub that efficiently connected law abiding users and providers of capital and financing around the world. He said this benefits both developed and developing countries by enabling their competitiveness in global trade and facilitating international investment into their domestic economies that help them grow and create jobs. For over forty years, the Cayman Islands has played a leading role in the fight against illegal activities and tax evasion, Scott stated following the latest agreement over access by officials to information held here.
“Industry and government have worked side-by-side to implement a legal infrastructure that promotes effective transparency and cross border cooperation with law enforcement that meets, and in some cases exceeds, international regulatory standards and comparable regimes in G20 countries,” he added.
The financial sector here has decades of experience in successfully operating a world class global financial hub, Scott explained. As a result, the Cayman Islands is positioned as a leader in its ability to contribute positively to the design and development of effective cross border cooperation laws and regulations, and was ready and willing to assist other international financial centres.
“We are pleased the UK Government has recognised that our licensed corporate services provider verified beneficial ownership system is a world class system that provides for due diligence know-your-customer checks that are critical to proper law enforcement authorities conducting legitimate investigations and is superior to other proposed systems,” Scott said.
Although there are already agreements in place facilitating UK authorities to get beneficial ownership information held in Cayman, the enhancement to the system will help the UK law enforcement agencies access information more quickly but it is not a public register.
“Beneficial ownership information details will remain with the corporate service providers managing them and information will be accessed via a central technical platform. The enhancements are in line with global standards and the United Kingdom’s own position,” explained Scott adding that the new system would be “essentially business as usual” for the industry and offers a path forward building on the work which has been going on for decades.
“The agreed enhancements to this system will ensure proper authorities conducting legitimate investigations can quickly identify all companies that a particular beneficial owner has a stake in without needing multiple requests and that those owners not be alerted to the existence of an investigation,” Scott said.
Government is expected to finalise the details of how the newly enhanced regime will work and draft the necessary amendments to existing laws, over the coming months. Officials said a working group, made up by professionals from the industry, is finalising details of “amendments to the relevant laws that provide the framework” for the regime. The system is expected to be in place by June 2017. A report on the group’s design of enhancements is expected within the next two to three weeks.
Under the proposed system information will be accessed via a ‘central technical platform’ that is not open to the public. The deal and plans for an enhanced regime were announced yesterday in both Cayman by the premier, Alden McLaughlin and in the UK at the House of Commons by the British prime minister, David Cameron who has found himself under-fire as a result of his own family’s use of offshore centres. He is also under mounting pressure from civil society and his political opponents to put more pressure on the UK’s territories engaged in the financial services sector to become more transparent.
However, with the new beneficial ownership regime still off limits to everyone but law enforcement or tax authorities, the press, at home and abroad, will continue to depend on leaks or criminal cases where charges are laid to expose offshore secrets.
Category: Finance, Financial Services
Phew. thought it was a body odour regime.
God help us….