EDITORIAL – Bad news demands a swift response

Today’s front page features a one-two punch to the reputation of the Cayman Islands.

For years, the general plaint heard from our country has been that we suffer from mistreatment at the hands of the international press: Cayman in reality is “squeaky clean,” but the world just doesn’t know it yet.

The pair of stories that lead today’s newspaper — 1) Cayman National Corporation companies’ guilty plea to U.S. tax evasion conspiracy, and 2) a legal battle waged against Cayman financial firms by overseas investors who claim they were bilked out of millions of dollars — not only do damage to Cayman’s image as a transparent and well-regulated financial jurisdiction, but also challenge the substance of that assertion.

We don’t intend to over-exaggerate the significance of this pair of particular developments. They aren’t mortal blows to Cayman’s financial sector — not even close. They do, however, add two new items to an ever-lengthening series of bad publicity for our country, including the collapse of Caledonian Bank (thanks to an overzealous SEC reaction to a relatively minor scheme involving penny stocks), Operation Tempura, the arrest of Premier McKeeva Bush (later acquitted by a jury on all counts) and, of course, the crown jewel of corruption in Cayman, the still-unfolding FIFA scandal. (That’s without hearkening back to the Enron, Eurobank, Parmalat and Guardian Bank and Trust fiascos.)

Running through those disparate instances of international reportage are common threads, most notably questionable activity (or absence of activity) by officials, whether it’s lawmakers, appointees, the Cayman Islands Monetary Authority, Royal Cayman Islands Police Service or even the U.K. Foreign and Commonwealth Office. Another commonality, almost to the point of becoming a rule, is that once the whiff of a scandal has reached the media’s sensitive nostrils, the inclination of Cayman’s public sector leaders is to clam up.

By this time, our authorities ought to be painfully aware that we inhabit a brave new world of communications. We at the Compass consider ourselves as a timely news distributor with a large reach (locally speaking). But in terms of universality and instantaneity, we don’t have anything on The New York Times, Wall Street Journal and Google, which can reach billions of people in the blink of an electronic eye, and each of which delivered news about Cayman National’s guilty plea almost as soon as it happened.

Yet, Cayman’s government continues to spend inordinate amounts of time, manpower and tax dollars on attempts to influence or dictate the behavior of local news media. (Need we remind you of government’s embargo last year against doing business with the Compass, over the content of an editorial column?)

Then, when a major piece of international news breaks that actually does threaten our country, necessitating urgent “damage control,” our authorities simply haven’t prepared themselves to react effectively when the situation requires it.

That’s true even in benign matters of purely local interest, such as the hiring of a high school principal. The Compass finally received the government’s long-promised press release on the matter yesterday, a full week after our news story appeared — and more than two weeks after he started on the job. We appreciate the statement, but at this point, it’s no longer “news”; it’s history.

We are frequently asked by government officials to hold off on publishing stories because they’re not yet ready to issue an “on the record” response. Sorry, but the news waits for no one. As soon as we have enough information to publish a story, we publish it.

Several weeks ago, we launched a new CaymanCompass.com website with the view toward disseminating breaking news faster and to a greater audience than ever before.

We suggest the government take similar strides to adapt to new technology and consumption habits. Officials would be well advised to create a new communications policy for the government — not fashioned by the usual candidates in the Legislative Assembly or Government Administration Building — but by qualified experts who know something about this area, and this era.

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  1. Very well written editorial and I applaud the efforts of the Cayman Compass to raise the issues so change can come. Points all well taken and goes to show the “light touch” regulatory framework deployed is NOT working at all. We need a new system of governance for all our sectors- not just financial services but tourism and real estate as well (where ill gotten proceeds are laundered). Need to stamp out corruption, nepotism and back slapping and get things done for the good of the country and its people. We don’t want to dwell on the past- not just the financial blow ups mentioned in today’s editorial and much more- even the billions and billions in derivatives booked through mutual funds and our banks can cause a real blow up anytime soon. Then there is the countless fronting taking place right in plain sight, the numbers playing every day, the drug trafficking and money laundering which have lead to start up capital for quite a few local businesses who have benefited from this drug trade over decades and decades seeing only a very very few at the top of the game caught. It’s wide spread- it’s rampant, we only see the tip of the iceberg and it all needs to be cleaned up now for the good and benefit of all and our kids and grand kids who will inherit this mess if we dont fix things now.

    After all we have to live in Cayman our home and we all desire for this place to be cleaned up and my humble view is that this will only start with strong leaders running our country (something we have not yet seen) and a VISION/ macro economic and strategic plan for the country for 2025 for starters !!!!!!!!!!!!! And for God sake finish the audits in government so we know our true financial state for the last 12 years and get the job done before dancing on trumped up laurels.

    So next year when election rolls around folks please vote with your heads and not just your hearts or as they say “WHO YA FAH !!!”