News about the Cayman Islands in the Foreign Press

Friday,  July 29, 2005

Cayman hedge funds lightly regulated 

LONDON, England – According to Reuters, many investors shun hedge funds, seeing them as risky because they can borrow to make bigger investments, use derivatives and short sell securities.

Most are domiciled in lightly-regulated low-tax offshore centres like the Cayman Islands, although managers in major financial centres like London would typically be registered with local regulatory authorities. 

Enron used Cayman subsidiaries to conceal finances 

MANCHESTER, USA – According to the Bennington Banner, a professor from Johns Hopkins gave a talk to a well-heeled audience about getting ripped off.  Dr Roger Leeds, a professor at the university’s School of Advanced International Studies, spoke on Tuesday about “Combating Corporate Corruption: Where is the Balance Between Market Discipline and Government Regulation?”

He talked about two of the most famous corporate accounting scandals, involving Enron and Worldcom, and attempts to reform the system, notably the Sarbanes-Oxley Act passed by Congress in 2002.  Enron, he said, developed a practice of overstating profits and understating its indebtedness. In addition, the company used subsidiaries on the Cayman Islands and elsewhere to conceal its finances.

Judge hunts Pinochet accounts in Cayman 

SANTIAGO, Chile – Reuters reports that a judge probing the bank accounts of former Chilean dictator Augusto Pinochet on Tuesday ordered a search for new suspected secret accounts in foreign countries. Judge Sergio Munoz ordered accounts to be investigated in Cayman and other countries, sources close to the process told Reuters..

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