Cayman doesn't make the cut

This from Cayman News Service, following our blog about the OECD considering whether to strike them off their grey list.

"Cayman has not made the OECD’s White List following a key meeting yesterday. The introduction of the government’s Unilateral Tax Exchange Mechanism which was hoped would ensure removal from the grey list doesn't appear to have found favour with the international organization’s Technical Committee. The decision has been greeted with dismay throughout the financial industry and particularly in the light of assurances received. CIFSA said it reaffirmed its advice to government that multiple bilateral or multilateral tax information exchange treaties be signed without delay."

This is the right decision from the OECD. Cayman, after all, offers this. And for all the criticism we've aimed at the OECD over its appalling "on-request" standard of information exchange (which is fully justified) we should also give the OECD credit for apparently terrifying the Cayman authorities with their failure to make the grade on their list.

Let's also just remember how much falsehood issues forth from Cayman's large spin industry, day in, day out. Try this recent one from their spin doctor in chief, Anthony Travers:

"none of the financial recklessness that has brought about much of the current global crisis occurred in or involved the Cayman Islands."

Really, Mr. Travers. Demonstrating this is false is as easy as shooting a fish in a barrel. There is the Bear Stearns fiasco, with Cayman at its heart. Why, just today, yet another piece of news emerges about Cayman's role in the midst of the giant global mess.

Two men have been arrested in connection with the collapse of the Mayfair hedge fund Weavering Capital, which went into administration in March with its leading fund owing investors more than $600m (£395m).
. . .
In a statement, the SFO said the investigation centred on a series of suspicious transactions with a related firm in the British Virgin Islands that had inflated the apparent value of the Macro Fixed Income Fund.
. . .
Weavering went into administration on 19 March after Macro, which was based in the Cayman Islands and presented as a low-risk investment, ran into trouble."

And let's not forget Enron, LTCM, Parmalat, BCCI, and so many more - these are among the biggest global scandals of all time. And each time, the same story emerges from the Cayman authorities: we are a transparent, well regulated jurisdiction. The trouble is, some people, both in Cayman and outside it, believe this stuff. We are delighted to see that the OECD has seen through the spin, at least in Cayman's case. Now it should apply those same standards to a number of other jurisdictions - starting with Delaware, Jersey and the City of London.