Non-profit sector draft bill heads to LA

| 12/09/2016 | 15 Comments

(CNS): After many years of discussion and numerous public consultations, government is bringing legislation to the parliament next month to govern the operation of non-profit entities. One of a long list of bills that the PPM government will be presenting at the next meeting of the Legislative Assembly, this is one of several new laws Cayman needs to enact ahead of next year’s Caribbean Financial Action Task Force’s mutual evaluation process. Although the bill is designed to protect the financial services sector and boost the country’s anti-money laundering and terrorist financing regime, it will also impact all local charities.

The Non-profit Organisations Bill, 2016 seeks to establish a register for all non-profit organisations. It defines an NPO as a company or body incorporated or unincorporated or a trust that is established primarily for the promotion of charitable, philanthropic, religious, cultural, educational, social or fraternal objectives that raises money from the public.

The registration of charities and other non-profit entities will help Cayman meet the FATF requirements that countries know the NPOs that are operating in their jurisdiction and for governments to monitor the non-profits to make sure they are not being used to finance terrorist organisations. But officials from the financial services ministry said the register will also provide several benefits to the Cayman Islands community.

“It would ensure that the public has access to information on all NPOs; allow for easy identification of entities that have been registered as NPOs; and facilitate investigations of, and enforcement against, bad actors within the NPO sector,” officials from the ministry stated, adding that the proposed law will streamline and quicken the registration process for NPOs, which will be within a maximum of 30 days.

The bill has been published on the Government Gazette as required by law ahead of the debate in parliament and is largely concerned with the registration of charities, but it also calls for all non-profit organisations to have appropriate internal controls in place, including an appropriate system to identify conduct which may involve the financing of terrorism. It will allow the attorney general to make enquiries into the activities of non-profits and charities to ensure that no funds are being directed towards terrorism and where the charity is suspected of any kind of criminal involvement.

The new law requires all charities that want to fundraise in Cayman to be registered and that NPOs have to keep proper financial statements with respect to the cash they collect and how it is spent. An administrative fines regime has also been created for non-compliance with the law.

The ministry said it will conduct a public education campaign for the bill in the near future.

See the draft bill here in the CNS Library

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Category: Laws, Politics

Comments (15)

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  1. False Prophet says:

    Some years ago I met a North American man who claimed he worked for a nonprofit organisation. He drove around in a shiny Porche 911 and looked after his boss’s house in an exclusive area of West Bay. Turned out his boss was a minister of church here and his house was on sale for $9M.

    Sorry but I find it hard to believe some of these so called non-profit organisations are actually not turning a major profit.

  2. Anonymous says:

    All non-profit organisations should be providing annual accounts (to a Government body) signed off by ALL members of the board for that year. Audited accounts are not really necessary but all board members should be accountable. These accounts should then be posted on a website for all to see.
    If I (Joe Public) can be asked to contribute then I (Joe Public) should be allowed to see where the funds are being used and where they came from in general.

    • MM says:

      Submit to Government? They can’t find red flags in their own accounting.

    • Anonymous says:

      (1) Its not the government’s business what I do with my money or what group X does with theirs. (Find the illegal action first, if that’s what you’re worried about.)
      (2) Its not your business what group X does with its money if you’re not a part of group X. If you don’t want to give them money because they don’t publish accounts publicly that’s your business. No one is forcing you to put money in the tin. But everyone, including those who don’t support group X, don’t have a right to know their business.

      • Anonymous says:

        So if I am asked to contribute to a non-profit organisation I have no right to know how the money was used????
        That will be fine if said organisation only asks their “members” for a contribution. Yeah, no more soliciting outside businesses, etc.

        • Anonymous says:

          No. You have no right. You have the right not to donate and they have the right to decide to keep their accounts public or private. Just because they’re asking doesn’t mean you have to give.

          So next time the kids are in Foster’s raising money for a sports trip just ask them if they will be publishing their accounts at the end. Then you can decide to donate or not.

      • Anonymous says:

        Perhaps best then if those entities that want privacy to register as regular companies, and solicit their donations from the public as private entities.

        Privacy should come with Profit entities.

        Let the non-profits and foundations, be public knowledge.

      • Anonymous says:

        Sounds like a church to me

  3. Anonymous says:

    I hope it includes churches as these are nothing but a con job. They promise things to the most vulnerable of investors that they cannot deliver.

    • Anonymous says:

      Disgusting and completely warped comment, with no understanding whatsoever of ‘church’ and how much many of them do for others every day without fundraising from non-members and without chronicling every dollar given in a major headline. We have become a community of the uninformed serving as experts on every subject.

      • SSM345 says:

        11:13, Perhaps you missed the previous fundraising efforts of churches a few years ago when Mac took OUR money and gave it to all who asked for it. Seeing as that’s OUR money, we have every right (as Non-members) to know exactly what those funds were used for. And yes, there are still churches out there who kept said funds despite the public outcry.

        • Anonymous says:

          So you’re going from a couple of churches to not just all churches but all service groups. If you want to say ‘if Govt. gives cash the accounting must be reported to Govt. for inclusion in Govt. accounts’, that’s fair enough. If you want to only give to groups, e.g., the National Trust, who publish their accounts every year, that’s fair enough. But you can’t go from the Nation Building Fund to every group raising funds for anything must publish their accounts for all to see. That is illogical and mean-spirited.

    • Anonymous says:


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