Cayman’s finance industry needs defending

| 09/10/2011

(CNS): Former Cayman Islands Monetary Authority chairman, Tim Ridley, believes that Cayman’s public and private sectors ought to be doing much more to defend Cayman’s stance globally, with nothing less than the islands' financial services industry at stake. Ridley says that the recent report by the Tax Justice Network reveals a continuous need for Cayman to keep presenting what he says is the accurate position about the local financial services industry.  The former CIMA boss said that although efforts are made, they have been “sporadic” and reactive, not proactive as it needs to be.

“The recent highly subjective and somewhat 'short on substance' secrecy report by the Tax Justice Network underscores how essential it is that Cayman presents the accurate position whenever and wherever possible and to those that matter,” he said.

Although Ridley concedes that the Cayman Islands Government and the private sector do, for the most part, appreciate the importance of defending Cayman’s position abroad, he called the actual development and implementation of coherent strategic plans “sporadic” and “reactive rather than proactive.” Both the government and the private sector need to up their respective games, he said, by devoting significantly more time and resources to meet these challenges.

“Those who would bury places like Cayman are in deadly earnest,” Ridley said. “So the very future of the financial services industry in Cayman is at stake." 

The recent Society of Trust and Estate Practitioners (STEP) Cayman Islands event in London, at which Ridley was a speaker, was an excellent example of the type of event Cayman needs to be doing more of, he added.

STEP Cayman Islands played host to a forum chaired by John Humphrys, the well-known BBC radio presenter, to examine Cayman’s expertise as a leading international jurisdiction in the field of trusts and private wealth structuring and charity and philanthropy, as well as wider business and commerce.

Carlos de Serpa Pimentel, Chairman of STEP Cayman Islands and Head of the Private Client & Trusts group at offshore law firm Appleby, said that hosting a seminar in London was a first for the Cayman branch of STEP.

“Our aim has always been to uncover the truths and myths about the Cayman Islands and to highlight the professional expertise available in the field of trusts and wealth structuring,” he added. Pimentel claimed that Cayman helps the world’s economy by offering a fully tax neutral platform for international financial transactions, which then enables substantial inflows of capital into onshore financial centres, enabling significant commercial investments to take place onshore. “In other words the existence of Cayman facilitates the workings of the world's financial system and makes it more efficient,” he said.

Don Seymour, Managing Director with dms, said Cayman needed to carry on its present course of defence.

“The agenda of the Tax Justice Network is clearly driven by philosophical differences based on ideology and not fact,” Seymour stated. “There is nothing that the Cayman Islands can do to alter this agenda.  Fortunately TJN is a marginal organisation whose ideas are disregarded in the international financial community.  Cayman needs to continue building its relationships with credible international standard setting bodies and not allow itself to be distracted by the vacuous ideas and desperate publicity stunts of TJN.”

The recent report by TJN ranked Cayman as the second most secret jurisdiction in the world behind Switzerland. Although it was dismissed by Cayman Finance, because it said the authors were politically biased against tax neutral jurisdictions, the report was not dismissed by the international media, which within days of the report being published waspublishing the details of the report itself and the analysis that the researchers did on Cayman.

See CNS story Cayman Finance dismisses secrecy ranking.

Category: Finance

Comments (20)

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  1. Herodotus says:

    The sad thing is that many in Cayman genuinely believe that Cayman's offshore success was Cayman's doing.  It was not.  It was London's doing and in part a result of the Bahamas's undoing by going independent and descending into corruption.  What London did, so it can undo.  And so it shall be because the clock is ticking for all of offshore and if the new recession does come along Cayman is one OECD report away from utter bankruptcy.

  2. Anonymous says:

    cayman…ask yourself…what would jesus do?

    • Like It Is says:

      Probably not structure a country around assisting the wealthy avoid paying taxes to help the poor?

  3. Anonymous says:

    I whole-heartedly agree that Cayman officials need to be pro-active in their defence andstrengthening of Cayman's finance industry. however, it does not help Cayman if stunts like the following are allowed to continue:

     

    A few months ago CIMA boycotts attending and/or speaking at an international conference because one of the hosts/main promoters (Offshore Alert I think) was casting Cayman in a bad light..

     

    Now I ask you, what better opportunity can you get to share your side of the story with your adversaries????? If the heads of CIMA cant go into the battlefield and defend Cayman then what good is it that they are heading up CIMA?

    • Anonymous says:

      Is there not a Financial Services Secretariat which, among other things, is supposed to focus on the overall reputation of the country's financial services sector?

      • Anonymous says:

        You are kidding right?

        • Anonymous says:

          No.  Serious question.

          • Anonymous says:

            There was a rumour to that effect, but no one has seen anything even remotely resembling a competent bit of analysis or research from the Secretariat in the past couple of years.

      • Anonymous says:

        All departments now focus on making the Minister look good in the very very short time.

    • Anonymous says:

      CIMA's primary role is and should be as regulator rather than advocate/conference presenter.  The latter role plus doing the necessary research should belong to the Finance Ministry but they don't seem to have anybody with suffient knowledge of financial service issues. Somebody has to spell it out to the Premier and his buddies that  we face some serious challenges in the financial services sector and his ministry needs to get their act together before it is too late.

      • tim ridley says:

        CIMA does have a valuable role to play, and senior members of CIMA do write articles and make presentations in a broad range of fora. This is not "marketing", but informing and educating readers and listeners about the regulatory and supervisory regime in the Cayman Islands. And why the regime is appropriate and effective for the financial services industry here. And what can be done to improve this regime.

        CIMA also regularly advises the industry both here and overseas of developments in international standards that will have an impact in Cayman. And how CIMA is planning to handle these developments.

        International standard setters, such as the IMF and OECD, and foreign regulators, such as the SEC and FSA, likewise spend considerable time in explaining what they do, how they do it and why they do it.

        Tim Ridley

    • Chris Johnson says:

      Representatives from other regularty bodies such as the BVI and TCI are not only invited but are invited to speak. There is no reason why Cayman should not follow suit and be proactive.
      Cayman Finance only seems to represent the big boys and the voice of the smaller operators is just plain ignored. It’s name is wrong for a start. If it is an association it should say so in the name, which is dreadfully misleading. Their Bermuda counterpart has been very proactive for years.

    • marchant says:

      Re. "A few months ago CIMA boycotts attending and/or speaking at an international conference because one of the hosts/main promoters (Offshore Alert I think) was casting Cayman in a bad light."

      CIMA has never boycotted OffshoreAlert or The OffshoreAlert Conference. I have always found CIMA to be professional and responsive in my dealings with it.

      It was Cayman Finance that boycotted OffshoreAlert for no other reason than I publicly commented that it should speak at independently-run conferences, rather than only industry-run conferences that, in my experience, are little more than pep rallies.

      Such mild criticisim (if it could even be considered criticism) was apparently too much for the then Tony Travers-led Cayman Finance.

      OffshoreAlert used to have an excellent relationship with CIFSA, as Cayman Finance was then known, when it was led by Eduardo D'Angelo Silva, who frequently spoke at our conferences and was a passionate and convincing spokesperson for Cayman's financial services sector.

      When Tony Travers replaced Eduardo, our relationship with Cayman Finance became non-existent. I know Mr. Travers has a lot of support locally but I think we was considered an embarrassment in the outside world, a person totally unsuited to be the public face of any organization, in my opinion.

  4. David Marchant says:

    On July 27, 2011, I wrote to Cayman Finance Chairman Richard Coles stating that: "I am writing to you in our capacity as the Chairman of Cayman Finance. I’m in the process of putting together an agenda for the 10th OffshoreAlert Conference, which will take place at The Ritz-Carlton, South Beach in Miami Beach, Florida on April 29 to May 1, 2012. There will be sessions aimed at three different groups of attendees: providers, buyers and investigators of offshore products and services. I would welcome any agenda ideas and suggestions that you or your members might have. By way of background, our conference typically attracts over 250 attendees from many different countries and is covered by the world’s major newspapers and news agencies, such as The Wall Street Journal, The New York Times, Reuters, Bloomberg and PBS. We typically have more than 40 attendees from Cayman …"

    Two-and-a-half months later, I am still waiting for a reply.

    David Marchant

    Publisher, OffshoreAlert

     

     

  5. Chris Johnson says:

    Thank for for your comments Tim. Cayman needs to be much more proactive. This includes modifying some of our archaic laws and introducing legislation to ensure that we do not have more embarrassing examples of hedge fund mismanagement such as Beacon Hill and the more recent Weaving case.TJN is not going to go away so why not beef up our laws and also revoke the Confidentiality Preservation Law as it serves no real purpose and in fact precludes the proper investigation of fraud that continually takes place in the Cayman Islands.

  6. Anonymous says:

    Mr Ridley is right about the absolute necessity of being proactive in exposing the falacies sold by Cayman's critics. Perhaps the private sector can do something in this regard, but unfortunately I don't think that there is anyone left in government with the skills required to analyse and debunk the rubbish produced by TJN and others let alone. Even if there were, the political leadership has no capacity to  comprehend what the issues are or to think beyond the next headline. Considering the implications of anything to do with the financial sector ten minutes into the future is simply outside the political leaderships' skill set. 

    Building relationships with the standard setters is of course also a necessary element, but Mr Seymour is very wrong to the extent that he thinks that focussing exclusively on building relationships with standard setters is sufficient. The standard setters are appointed by or seconded from onshore governments which are subject to political pressure from the supporters of TJN and their kind. He should also recall that the US Senate and others quote the TJN when it suits their purpose before he labels their activities as fringe.

    • Fair Enuff says:

      Shame that the TJN report was fairly accurate.

    • so Anonymous says:

      In other words there is a good reason that Cayman is going down hill fast.  In the modern world of today the strong and the smart survive.  Cayman is neither.

      No skills, no capacity to comprehend, and no reason to survive.