UK-Cayman Islands row over law enforcement cooperation intensifies

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Entrance to the Foreign and Commonwealth Office in London. Photo: Kaihsu Tai/Wikimedia

GEORGE TOWN, Cayman Islands (CNS) — The row between the Cayman Islands government and the UK intensified on Monday, as Foreign and Commonwealth Office (FCO) officials stood by National Crime Agency (NCA) complaints, while Premier Alden McLaughlin continued to deny that Cayman was the cause of the disagreement over what the UK says is declining law enforcement co-operation compared to other territories.

The FCO has said the Cayman government’s decision to switch the point of contact for the NCA from the police Financial Crimes Unit to the Financial Reporting Authority of the Cayman Islands has undermined the ability of investigators to get immediate information needed for important crime cases because of the limited hours of operation.

In his second statement about Britain’s complaints, McLaughlin again denied being uncooperative and pointed to the privacy issues Cayman believes need to be protected. He said that the UK and the Cayman government had a “difference of opinion on fundamental issues of data security and human rights, regarding the right to privacy”.

He added, “Cayman has on several occasions offered case-law examples to support our point of view. The FCO has never provided any counterpoints, choosing instead to dismiss Cayman’s concerns without explanation. This attitude is alarming as a recent decision by the European Court of Human Rights found that British surveillance violated privacy rights – an indication that the UK’s interpretation of human rights protection is not infallible.”

The premier accused the FCO of previously dismissing the Cayman government’s concerns about data security, specifically encryption, in relation to the exchange of information for an active investigation, but in July the British had conceded that Cayman’s concerns were well founded.

McLaughlin said that under the ‘Exchange of Notes’ (EoN) agreement, the FCU was designated as the point of contact for requests regarding the beneficial owners of companies until the technical platform for exchange of information was fully operational. At the end of the transition period, on 30 June, the additional powers delegated to the FCU “were no longer necessary and were consequently revoked”, the premier said.

While FCO sources said that this was creating problems, McLaughlin said, “The revocation of this delegation to the Financial Crimes Unit in no way affects the ability of local law enforcement to cooperate with its international counterparts, a point that has explicitly been made to the FCO on multiple occasions.”

The Financial Crimes Unit can still make search requests on the beneficial ownership platform in accordance with the provisions of local Companies Law.

The premier said the Cayman Islands has taken the position that the UK is in breach of the agreement made with the exchange of notes after the Sanctions and Anti-Money Laundering Bill passed in parliament, which will impose public registers on Cayman and other overseas territories. The premier said Cayman has nevertheless repeatedly sought to ensure the UK that an enhanced level of cooperation remains in place.

“The Cayman Islands stands by its commitment to cooperate with all international law enforcement, including the NCA, but will not be bullied into the violation of fundamental principles of human rights or to cooperating in a way that runs counter to internationally accepted standards,” McLaughlin stated.

The FCO, however, has said that Cayman remains the only British Overseas Territories that has taken action to pull out of its agreement with the UK over exchanging beneficial ownership information. UK sources have also said that there are concerns that the current disagreements could backfire on the Cayman Islands by undermining the support it gained over the change in legislation after the Conservative government’s U-turn on the beneficial ownership issue.

This, they warned, could lead to even more pressure regarding public registers, as it fuels the claims made by those seeking public access that Cayman is being secretive.

The current process of how the UK secures information for criminal investigations will be under review later this year by the British Parliament, and if things remain as they are in the Cayman Islands, some officials believe Cayman will be singled out as the uncooperative territory in the subsequent report, undermining any support it once had.

Republished with permission of Cayman News Service

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