In response to the Cayman Compass article, “Privy Council rejects challenge against CIMA” (Aug. 7)
Select Vantage Inc. (SVI) is disappointed that the Cayman Compass published its article without first seeking comment from SVI. If comment had been sought, SVI could have corrected some significant errors in the article.
Here are the facts:
SVI always complies with inquiries from securities regulators regarding the particulars of its trading activity and is pleased to share all relevant information with regulators.
However, in this instance, the Australian regulator (ASIC) requested that CIMA require SVI to produce contact particulars for all 1,400 of the traders who had traded in Australia on SVI’s behalf. Neither ASIC nor CIMA explained to SVI why that information was required, or how it was relevant to any investigation, or how the information would be used by CIMA or ASIC if it was produced.
Indeed, the direction that CIMA gave to SVI requiring SVI to produce the contact information did not refer to any investigation – it was simply a demand for the contact information of every person who traded on behalf of SVI in Australian markets.
SVI was concerned by the regulator’s refusal to explain why the contact information was sought or how it would be used.
SVI respects CIMA’s statutory authority to compel production of information held by CI-domiciled entities when requested by foreign regulators.
In this instance, SVI considered that as a matter of principle it ought to seek to protect the confidentiality of its traders’ contact information in response to what SVI considered to be an unreasonable request that was not rationally connected to any proper regulatory investigation.
Further, SVI was concerned that ASIC’s demand that SVI produce its traders’ contact information only arose after SVI’s Australian lawyers had notified ASIC that SVI was contemplating civil proceedings against ASIC for false and injurious statements made by ASIC officers to various market participants in 2014.
SVI provided CIMA with the contact information it sought in December 2017. Thus the Privy Council ruling discussed in the Cayman Compass article is effectively moot. SVI continued with the proceedings because it considered there to be an important question of principle at stake.
Daniel Schlaepfer, President
Select Vantage Inc.