At the beginning of May, the U.K. House of Commons acted to force public registers of beneficial ownership upon the Cayman Islands and other British Overseas Territories. Now, that the House of Lords has acquiesced to the lower chamber’s version of the relevant legislation, the betrayal of Cayman and our sister territories by the U.K. Parliament is complete.
It is, perhaps, some small solace that several members of the House of Lords spoke up in our defense – strongly and rationally – during the debate on the U.K. Sanctions and Anti-Money Laundering Bill, before the legislative body ultimately decided not to intervene and prevent the real harm being wrought upon the territories by our own British government.
Lord Tariq Mahmood Ahmad of Wimbledon, the minister responsible for the overseas territories, demonstrated his firm grasp of the seriousness of the situation – an awareness that stands in stark contrast to the ignorance on the subject displayed nearly universally in the earlier House of Commons debate.
Lord Ahmad reminded the Peers that overseas territories are separate, self-governing jurisdictions whose local governments must be overridden only in the most exceptional of circumstances.
“By contrast, financial services are an area of domestic responsibility for territory governments, where they surpass – an important point to remember – international standards in the context of beneficial ownership,” Lord Ahmad said.
Lord Naseby, Michael Morris, the vice chairman of the All-Party Parliamentary Group for the Cayman Islands, accurately labeled the legislation as “a catastrophe for financial services in the overseas territories.”
Lord David Edmond Neuberger of Abbotsbury said, “There has been no consultation with the democratically elected governments of any of the territories about the legislation. There has been no investigation of the effectiveness of this law in relation to any of the territories. There has been no inquiry as to the economic and social consequences of the legislation on any of the territories.”
And yet, the offending legislation moved forward.
During these perilous times, we urge Cayman’s leaders to be uncharacteristically open and communicative with the people of these islands. The offshore financial sector provides over half of the entire government budget, and any threat to that industry threatens us all.
Meanwhile, on the “eastern front” of the war against offshore financial centers, the European Union is poised to decide (most likely in December) which jurisdictions make its “white list,” “blacklist” or perhaps remain on its “grey list,” where Cayman now resides. Financial Services Minister Tara Rivers is in Brussels this week, lobbying on our behalf.
In regard to the British legislation, Premier Alden McLaughlin has been both active and vocal. On Wednesday, the premier and other leaders held a press conference about recent discussions with the U.K. government, including with Prime Minister Theresa May, and more importantly, Cayman’s plan of action in response to the anticipated U.K. Order in Council. (For more, read our story on Page One.)
Regardless of the best efforts of our elected members, at home and abroad, we must not lose sight of the fact the Cayman’s “A Team” cannot be found on government benches but rather in the financial services industry itself. Cayman’s private sector, understandably, is far more knowledgeable and able in all matters financial than its public representatives, and it is, therefore, paramount that they inform and participate in our strategy going forward.
Most of our top talent resides in member firms of Cayman Finance, the professional association representing our financial services industry. To date, government has usurped too large a portion of the role that rightfully could be better executed by a true public-private partnership.
With so much at stake for these islands, we cannot afford to leave our star players sitting silent on the sidelines.