Offshore Cayman Islands

The Special Trusts (Alternative Regime) Law 1997 (STAR), substantially extends Cayman's trust planning framework. STAR allows trusts for any purpose (charitable trusts, person trusts, and purpose trusts) as well as mixed trusts, provided they are lawful and not contrary to public policy.

Banks licensed in the Islands represent fifty-four countries. Some of the reasons influencing their decision include the Cayman Islands strong reputation for sensible regulation, professionalism, confidentiality, tax advantages, asset protection, political stability, good infrastructure and geographical location. As a premier financial services jurisdiction, Cayman attracts the world's leading accounting, legal and investment firms, and the banking industry remains a cornerstone of Cayman's success.

With no direct taxation, The Cayman Islands are a thriving Offshore Financial Center (OFC).  The Cayman Islands financial services industry developed, along a path similar to that in other offshore centers, on the strength of private banking, security, protection of assets and now following suit with other OFC's, anti-crime protection. While meeting the needs of high net worth individuals is still an important aspect of the industry, recently the focus has moved very much towards institutional business.

The Cayman Islands is recognized as one of the top 10 OFC's in the world, with over 40 of the top 50 banks holding licenses there. Inter-bank bookings between onshore banks and their Cayman Islands branches or subsidiaries account for more than 80 percent of the US$1 trillion on deposit and booked through the Cayman Islands , representing a low risk profile for money laundering. This statistic reflects the recognition of the Islands ' stature in international finance as well as its position as one of the leading centers of the global Euro-currency market .

There are currently 295 banks and trust companies as of end of third quarter 2006. Around 19 banks have "A" licenses that allow them to carry on business with residents and nonresidents of the Islands . The remaining 276 companies hold "B" licenses and are for the most part restricted to offshore transactions with nonresidents.

As advised in all of these articles, a person is advised never to “go it alone” without a professional supervisor. The advantages are set forth to attract banks, customers and business.

The Confidential Relationships Law provides statutory confidentiality of client information, though it should be noted that the Governor in Council can authorize disclosure of information where there is evidence of criminality. This can apply to transactions effected outside Cayman if, had they taken place within the Islands , they would have constituted a criminal offense.

In addition, in 1990 the Mutual Legal Assistance Treaty with the United States Government came into effect. The treaty provides for the exchange of information required in the investigation of a range of criminal activity. It excludes tax matters.