16 February, 2009

It has been indicated that UK finance officials set two visits to the Cayman Islands this year, starting in mid-March, in order to look into Britain's contingent liabilities and the possibility of damage to London's international reputation resulting from financial activities here.

Facts regarding visits have begun to appear in the wake of this month's constitutional talks in London, through which Cayman Islands delegates also met Lord Paul Myners, UK Financial Services Secretary, and Michael Foot, leader of the inspection team.

According to Hon Alden McLaughlin, Minister of Education with responsibility for International Financial Affairs, "Their purpose is to have that exercise complete before the end of the year."

"What Michael Foot said was that there would be at least two visits to the Cayman Islands, but that it was not his purpose to deal with ground that was already trammeled effectively, so when there are other investigations such as the OECD [the Organization for Economic Cooperation and Development] or the FATF [Financial Action Task Force] or the IMF [International Monetary Fund], he would depend on that information to the extent it was still pertinant."

He could not anticipate how long any of the visits might last or when the second one would start from.

The first tour is all set to begin in the second week of March, comes after the declaration in November made in the context of British 2009-2010 budget planning of an independent review of UK-affiliated offshore finance centres among Crown Dependencies and Overseas Territories (OTs).

However, the team, led by Mr Foot, a veteran of the Bank of England and former Managing Director of the UK's Finance Services Authority, will investigate industries in Jersey, Guernsey, the Isle of Man, Gibraltar, the Cayman Islands, the British Virgin Islands, Anguilla, Bermuda and the Turks and Caicos Islands.

It has been pointed out that the primary approaches to Lord Myners in late November and early December by Cayman leaders had proven immensely useless, but Mr McLaughlin stated more current discussions had been of more great assistance.

According to Minister "They are chiefly worried about two things. "The first is their contingent liabilities that means what if Cayman banks or big institutions were to fail and Cayman government were needed to step in and bail them out.

"The second, of course, is their ever-present stress regarding their reputation," he added.