Cayman Islands businessman Canover Watson was arrested by Anti-Corruption Commission officers Monday immediately after his release on license from Her Majesty’s Prison, Northward.

According to law enforcement sources, Mr. Watson, 47, had been granted early release from prison by the Cayman Islands Conditional Release Board after serving 28 months of a seven-year sentence he received for his role in the CarePay hospital contract fraud.

Mr. Watson was sentenced on Feb. 5, 2016 to seven years’ imprisonment on charges of conspiracy to defraud the government in the CarePay scheme, as well as for three corruption-related charges in the fraud, which prosecutors said skimmed a total of nearly $6 million from public coffers over three years.

Cayman’s current Conditional Release Law requires prison inmates who receive sentences of more than one year to serve at least 60 percent of that time in confinement, after which they may be paroled.

Sixty percent of Mr. Watson’s seven-year sentence would have been about 50 months, but he served only 28 months.

However, the Conditional Release Law, passed by the legislature in 2014, took effect on Feb. 15, 2016 – 10 days after Mr. Watson received his sentence for the CarePay fraud.

Consequently, Mr. Watson’s sentence period was decided under the old Prisons Law which, in certain cases, allowed inmates who showed good behavior while incarcerated to be released much earlier depending on the offense they committed.

Under the old law, violent criminal offenders such as robbers, rapists, kidnappers, drug dealers and arsonists, were required to spent five-ninths of their sentence in prison before becoming eligible for release on license (or parole as it was called in those days.)

However, other non-violent offenders were often required to serve just one-third of their prison sentences before becoming eligible for release.

According to officials who spoke to the Cayman Compass on condition of anonymity, Mr. Watson fit into the latter category in the old Prisons Law and was granted release by the Conditional Release Board effective Monday given that one-third of his seven-year sentence is about 28 months.

The conditions of Mr. Watson’s release on license are not known, but as of Monday, he had been released from his custodial sentence at Northward.

Mr. Watson was taken into custody by Anti-Corruption Commission officers just after his release and taken to the police jail in Fairbanks for questioning in connection with a separate criminal investigation involving $1.2 million in controversial “loans” given to the Cayman Islands Football Association in 2013.

Mr. Watson, the former treasurer of that association, has not been charged with any crimes in connection with the probe, but he has been arrested twice by anti-corruption officers – once on June 30, 2017 and again on Monday.

Following questioning Monday by anti-corruption officers, Mr. Watson was released on police bail.

Anti-Corruption Commission officials declined to comment regarding why the additional arrest was required, but according to a commission press release issued Monday, a third allegation – conspiracy to defraud under the common law – had been made in connection with the football funds investigation.

Mr. Watson’s attorney, Amelia Fosuhene, declined to comment about any matters related to her client on Monday.

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