Cayman Islands: Privacy — A Balancing Act in Changing Times
| DOI | https://doi.org/10.1108/eb025880 |
| Date | 01 April 1998 |
| Pages | 176-178 |
| Published date | 01 April 1998 |
| Author | Michael L. Alberga |
| Subject Matter | Accounting & finance |
Journal of Financial Crime — Vol. 6 No. 2 — International
INTERNATIONAL
Cayman Islands: Privacy — A Balancing Act in
Changing Times
Michael L. Alberga
INTRODUCTION
Over ten years ago, the leaders of the G-7 coun-
tries began to focus on the serious problem caused
by the ravenous appetites from within many of
their own countries for the consumption and use
of illicit drugs and the resulting problems of the
large sums of money which were being amassed by
persons involved in the many stages of this illicit
and dangerous activity. Law enforcement agencies
had failed to stem the tide of supply or demand,
and with demand increasing there was an urgent
need for action.
New thought had to be brought to the efforts to
fight this plague. As a result of various meetings of
the G-7 leaders, recommendations were made for
the introduction of a series of legislative initiatives
by member countries which it was hoped at the
time would assist in combating the problem.
Specific legislation which was introduced as a
result made inroads into the right of privacy nor-
mally accorded individuals in democratic Western
societies and widened the array of persons required
to assist in the growing battle to include bankers
and other professionals. Obligations to report to
various law enforcement agencies and regulatory
bodies on the accumulation and movement of
funds which aroused the suspicion of bankers as
being derived from the drug trade were incorpor-
ated into numerous pieces of legislation. Many of
these legislative initiatives abrogated the normal
checks and balances which had been developed
within legal systems over many years which were
designed to protect the individual from intrusive
behaviour of the state and its various agencies. In
some countries this included the reduction of the
time-tested burden of proof of knowledge beyond
a reasonable doubt to that of suspicion, an unde-
fined and very subjective test.
Bankers and other professionals were required
by compulsion of law to perform a job for which
they had no former training and in addition were
now subjected to severe criminal penalties for
failure to perform efficiently in their new role.
Unfortunately, the initiatives met with limited
success and the appetite of the population of most
of the G-7 countries and through their influence
most other countries in the world for the con-
sumption of illicit drugs, seemed to be growing
along with the criminal complications which
resulted therefrom.
Law enforcement, despite gallant efforts, con-
tinued to report that the battle was being lost and
the G-7 countries again turned their attention to
these problems with an expanded agenda designed
to tighten legislation, increase the role of bankers
and service providers to that of enquiring into and
monitoring the activities of customers, their accu-
mulation of wealth from all sources, developing
programmes to identify activities which might be
suspicious and reporting those activities to various
established authorities. This was achieved by the
imposition of far reaching legislation and the
author's colleague Mr Neil Timms will be review-
ing some of the legislation and regulations which
have been introduced in an effort to combat this
type of activity.
These well-intended efforts have encouraged
various governmental agencies and law enforce-
ment officials to begin a well-orchestrated pro-
gramme to label the right to privacy and
confidentiality as synonymous with criminal inten-
tions or activities and to launch an attack generally
on privacy. They apparently hope to achieve a sit-
uation, at least in their own countries, whereby law
enforcement agencies can request and obtain infor-
mation without having the additional burden and
complication of establishing at least a prima facie
case for the need for such information and without
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