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A year after it was notified, by victims, that B & C Capital, Ltd., an exempt Cayman corporation with no banking license, was accepting funds, pursuant to a written instrument that described it as a bank, and financial institution, CIMA has taken no regulatory action against the company, nor brought civil or criminal charges against the directors, who were Cayman residents. B & C, insolvent since February 2015, is now being liquidated, and without any bank accounts; millions of dollars in client accounts is missing, and unaccounted for. B & C was misrepresented to be a bank, when in truth and in fact, it was a shell company with no assets. Funds were transferred into it, from Dundee Merchant Bank, based solely upon its listed status as a bank, on the transfer authorization itself.
The Banks & Trust Companies Law, of the Cayman islands, requires any entity that accept deposits to hold the appropriate banking license. The Cayman Islands Monetary Authority (CIMA), pursuant to the Monetary Authority Law, has jurisdiction over financial institutions, and has specific enforcement powers, but has taken no action in the B & C Capital case, notwithstanding clear and convincing evidence of massive fraud, theft of client funds, and money laundering.
CIMA has offered no explanation for its failure to protect foreign investors in this case, without any apparent reason, claiming confidentiality, but taking absolutely no action, and forcing the victims to seek redress through the courts themselves. Its open investigation has been pending for more than one year*. There were criminal violations committed here. If CIMA cannot be depended upon to protect investors who place their funds in the Cayman Islands, Cayman's attractiveness as an offshore financial center will suffer capital flight, and a decrease in new business arriving from abroad.
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* In recent years, there have been at least twelve major investment frauds committed in the Cayman Islands, and victims' advocates have reported that none of the victims ever recovered their money.
The Banks & Trust Companies Law, of the Cayman islands, requires any entity that accept deposits to hold the appropriate banking license. The Cayman Islands Monetary Authority (CIMA), pursuant to the Monetary Authority Law, has jurisdiction over financial institutions, and has specific enforcement powers, but has taken no action in the B & C Capital case, notwithstanding clear and convincing evidence of massive fraud, theft of client funds, and money laundering.
CIMA has offered no explanation for its failure to protect foreign investors in this case, without any apparent reason, claiming confidentiality, but taking absolutely no action, and forcing the victims to seek redress through the courts themselves. Its open investigation has been pending for more than one year*. There were criminal violations committed here. If CIMA cannot be depended upon to protect investors who place their funds in the Cayman Islands, Cayman's attractiveness as an offshore financial center will suffer capital flight, and a decrease in new business arriving from abroad.
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* In recent years, there have been at least twelve major investment frauds committed in the Cayman Islands, and victims' advocates have reported that none of the victims ever recovered their money.
