Financial Crime World

Cayman Islands Tightens Grip on Corruption with New Laws

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The Cayman Islands has taken a significant step forward in combating corruption and promoting transparency by introducing new laws aimed at preventing and detecting corruption offenses.

Hospitality Guidelines for Board Directors and Monetary Council Members

Under the new law, board directors and members of the Monetary Council (MC) are required to exercise discretion when accepting hospitality from relevant organizations and professional advisors. This includes:

  • Routine business lunches are permitted unless they become frequent or lavish
  • Attendance at expensive or exclusive sporting and cultural events is discouraged unless circumstances have been discussed with the Managing Director of CIMA
  • Refusal of invitations where:
    • You and your partner are the only guests
    • The host’s party consists of six or eight people, and the price of tickets and accompanying fare exceeds CI$100 (approximately US$120) per head
    • Invitations could be construed as unusual or create a sense of obligation to the host

Powers of the Commission

The law gives the Commission broad powers to prevent and detect corruption offenses, including:

  • Ordering individuals to refrain from dealing with their bank accounts or other property for up to 21 days if there is reasonable cause to believe it relates to the proceeds of a corruption offense
  • Requiring individuals to provide information in connection with an investigation

Corporate Liability for Bribery and Corruption Offenses

Companies are now liable where an offense is committed by a director, manager, secretary or similar officer with their consent, connivance, or through neglect.

Collaboration and Public Awareness Campaigns

The Commission will continue to work closely with the RCIPS Anti-Corruption Unit and the Auditor General to detect and expose corruption. The Commission will also engage in public awareness campaigns with other institutions and associations to promote transparency and accountability.

Expert Reaction

Experts believe that these new laws are a significant step forward in combating corruption in the Cayman Islands. “These laws send a strong message that corruption will not be tolerated in our jurisdiction,” said Adam Huckle, a partner at Maples and Calder. “We expect to see a significant reduction in corruption offenses as a result of these new measures.”

Implementation

The law comes into effect immediately, with the Commission expected to implement interim measures and procedural policies in the coming months.

By introducing these new laws, the Cayman Islands is sending a strong message that corruption will not be tolerated in its jurisdiction. The government’s commitment to transparency and accountability is expected to have a significant impact on reducing corruption offenses in the country.