CIG looks to smooth local charity troubles

| 04/12/2018 | 29 Comments

Cayman News Service(CNS): More than 400 churches, sports clubs, community groups and charities in the Cayman Islands that are registered with government have been experiencing major administrative headaches as a result of the Non-Profit Organisations Law, 2017, which was implemented to deal with the risks posed by offshore non-profit entities. So, in moves to help local charitable organisations in this new and more onerous environment, government officials have been speaking with the banks about some of the challenges they have in opening accounts, and have made some technical changes to the relevant legislation.

A press release from the Ministry of Financial Services explained that officials from the ministry and General Registry had met retail banks, and that during the Legislative Assembly meeting last month the ministry had steered through legislation to clarify Cayman’s NPO regime.

“The public has expressed to the General Registry, specifically the registrar of NPOs, along with the wider ministry, issues experienced by NPOs with regard to opening bank accounts at local banks and maintaining general banking relationships,” said General Registry’s Head of Compliance Paul Inniss.

“Our meetings with the banks showed us that local financial institutions needed clarity around their anti-money laundering/countering of terrorist financing methods with regards to NPOs. We hope the banks can now tweak their measures to better facilitate NPO business,” he added.

According to the release, the feedback helped formulate the Companies (Amendment) Law, 2018, which allows the registrar general, rather than Cabinet, to process and approve applications under Section 80 of the Companies Law (2018 Revision). Officials believe this will be more efficient, with a shorter turnaround time for applications.

In addition, the NPO (Amendment) Law, 2018 was created to provide clarity on the organisations in scope of the law, provide the registrar of NPOs with the power to periodically assess Cayman’s NPO sector in order to identify any potential jurisdictional vulnerabilities to terrorist financing activities, clarify what information maintained by the registrar of NPOs is publicly available, and allow NPOs to obtain official copies of their organisation’s documents, which are held by the registrar of NPOs.

These pieces of legislation supplement the legal framework created by the original 2017 law, which was enacted as part of Cayman’s need to meet the requirements of last year’s Caribbean Financial Action Task Force (CFATF) assessment to counter money laundering and terrorist financing.

However, local charities, which are generally considered low-risk, have been caught up in the complexities and risks of offshore compliance, as the evaluation requires a local charity registration process to gather empirical evidence on non-profits operating in Cayman to prove their risk is, as believed, minimal.

“With such a significant portion of Cayman’s community being affected, it is important the banks continue to review their on boarding and account maintenance process, considering the specific risk posed by each NPO,” said Innis. “The banks should note that following an informal and positive review of charities in the Cayman Islands, the registrar of NPOs will be undertaking a formal assessment of the NPO sector, which will ultimately lead to issuance of industry guidance,” he added.

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Category: Banking, Business, Laws, Politics

Comments (29)

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  1. Chet Oswald Ebanks says:

    Cayman Islands Churches nothing but money making building funds. Building big eleborate palaces on EARTH, AND FORGETTING THE POOR, VULNERABLE AND ELDERLY AND SPREADING HATE. The preacher’s, pastors collect high salaries and drive around in over priced expensive vehicles. If the Churches did more to assist the poor elderly and vunlerable in The Cayman Islands.Then they could say they actually care about and value each and every one. One BIG THING IS THAT THEY FAIL TO REALIZE. WE ARE ALL CREATED EQUAL IN GOD’S EYES.

    NOTHING BUT A BUNCH OF MONEY GRABBING, TWO FACED HIPPOCRATES.
    MONDAY TO SATURDAY, THEY WILL PASS YOU BY LIKE THEY DON’T KNOW YOU. COME SUNDAY THEY SHOW YOU A DIFFERENT FACE AS IF THEY ACTUALLY CARE.

    I CALL MOST CHURCHES IN CAYMAN MAFIA PLAIN AND SIMPLE.

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  2. Markos Trapezopoulos says:

    Why have most of the commentators on this news item descended into a diatribe about churches?
    The whole point of the story is the difficulties imposed upon NPOs by the banks who claim they are obliged to do it by the CIMA. IF Paul Inniss has managed to convince the banks to drop the absurdities then good for him; unfortunately I doubt it: Once a proceedure is implemented it never ever gets rescinded.
    Anyone can open a bank account in, say Florida or the UK simply by walking into the bank and asking. No ‘job letter’, no bank reference, no filling in a dozen forms. If it can work there, why not here?

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  3. say it like it is says:

    The banks need to focus on businesses that do little business yet pay in large sums of money, mostly cash.Another area that needs close attention is the money transfer business which is wide open to abuse as has been demonstrated many times in the UK.

    • Chris Johnson says:

      There are about 1200 accountants on the island the majority bearing expats. May I suggest that more of these put back into the community and act as tresurer to some of the charities.

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  4. satirony says:

    Let’s face it, anyone owning or wanting to open a bank account these days is considered guilty of money laundering until proven innocent. Sometimes this innocence, established over the fullness of an honourable lifetime, can take months to re-prove to the satisfaction of the FACTA-istas, unless of course you live in Delaware. I sometimes wonder if any criminals have so much as blinked during his compliance oppression. As always, it’s the decent people who suffer, while the criminals find another way, like flowing water, and move on. And by the way, Chris Johnson’s comments above are beyond apt. How does the Government think the average Joe feels when CIFA gets away with this in-your-face non-compliance and apparent corruption? It’s shameful and anger-making, and that’s putting it mildly. We should all be equal under FACTA.

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    • Anonymous says:

      satirony, this is very well put. Thank you for this.

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    • Anonymous says:

      The thing about Delaware is not true. If you live there you aren’t getting any more special privileges–city, state, and federal taxes all apply. It only matters is you’re a foreign business and in that case you wouldn’t “live” there. I lived in Delaware for many years and worked in that industry and now live in Cayman. I can do the comparison.

      • Anonymous says:

        It’s not necessarily about Delaware per se. It’s about the US (and a little bit Canada). In the large countries you do not need to provide source of funds. I’ve never had to even provide a bank reference much less proof of address. I just told them my address and I opened a bank account in less than 20 minutes. I walked out with a bank card/debit card with visa on it. I deposited a lot more cash than I ever could in Cayman without any need for extra paperwork. They didn’t even ask for a job letter.

        Opening a bank account in Cayman took over a month. Then next thing was every single time I made a cash deposit over $3000 I was questioned and treated like a criminal. Even though I explained at the onset where the ongoing cash was going to come from.

        But every single Canadian and American bank has accepted amounts over 10k in cash and not questioned.

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  5. Anonymous says:

    Many churches own properties that are commercially rented out.
    What exactly is non-profit about that ?

    As with any law, If there are sanctions, they will not be followed.

    So fine them and you will see how fast the administrations are up to date.

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  6. Anonymous says:

    Typical legislation…no consideration for implications or application of common sense. Sounds like some of the blame is being directed at the banks for this blunder which is ridiculous! If banks don’t adhere to the law, they can be fined and by following the law as in this case, customers are pissed.

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  7. Pastor needs a new Caddy for Xmas says:

    Local charities considered a low risk, what? The back door is wide open, but then again it’s been open from morning. Nothing new, funny business as usual, thats how we roll!

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    • Chris Johnson says:

      The Cayman Islands Football Association is registered under the new law. That is unbelievable. They have not presented proper accounts for four years and the previous accounts were figments of the imagination. What the heck is this Government doing?
      The anti corruption folks are meant to be investigating CIFA. How daft can this scenario get?

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  8. Anonymous says:

    Let’s cut the bullshit. Churches are not charities, never have been and never will be.

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    • Anonymous says:

      Churches are charities. I think you meant to say they are not charitable.

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      • Anonymous says:

        Correct. So 3.57pm let’s cut the macho “let’s cut the bullshit” until you’re on a subject you know something about, shall we?

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      • Anonymous says:

        Can I get my 10% back that I paid over 30 years so that my daughter could get that one reference she needed once in her life. 80,000 dollars for one signature seems a bit much.

        Turns out I also did not need the protection from the Church to keep my job although I know alot of people whom got fired because they made some church-folk angry. Churches acting mafioso when they reverse their protection. Nothing is free.

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        • . says:

          Who told you that you had to give the church 10% of your salary so that your daughter could get a reference. Why couldn’t she get a reference from her school, a teacher, or some other person of influence. Your story sounds like a load of crap and you know it. Some of you are going to burn for lying on churches!!

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          • Anonymous says:

            See, now I need to goto church and pay 20% this week or I am going to hell fo telling the truth The Mafia just breaks your knees, the church breaks your spirit and disenfranchises you to hell.

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      • Anonymous says:

        Uncharitably mean, as well as wrong, whether deliberately or ignorant on the subject. How many church accounts have you examined to reach that conclusion? In the church of which I am a member, we are 0% dependent on the kindness of strangers – the members of the church provide the funds as we individually feel blessed to be able to invest in the work of our Lord. (I suspect that might be what 3:57 pm meant about not being a charity – i.e. not depending on OTHERS to give.) And, routinely, approximately one-third of our outgoings are for ‘charitable care and educational/social development programmes’ for ‘others’ (i.e. non-congregants); and this does not count the in-kind giving every week of groceries, toiletries, baby needs, etc., nor the tiny amount given to care for any members who fall in need because of infirmities or otherwise – nor the funds used for the spiritual growth of others (as well as congregants). If you give more than one-third of your outgoings for the care and development of others, then feel free to criticize us. If not, why not join us in trying to help others as Jesus would do, while equipping ourselves for eternity with Christ?

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        • Anonymous says:

          Oh jesus

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        • Anonymous says:

          Sorry you’re current car is nice enough and you’re quality of life is much better than mine, you don’t need any more “donations”.

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        • Anonymous says:

          Sounds like we go to the same Church!! I pay my tithes willingly as instructed in the Bible and my church and I have been amazingly blessed. No pastor or anyone else had to ring my arms to do so. GOd is good, all the time!

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          • Anonymous says:

            I cant afford a car, God must hate me. How do I get this all powerful being to get off my small back? For having dominion over the whole universe he certainly has it in for me.

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        • Anonymous says:

          And the government never helps the churches out and none of you put volunteer work on your resumes and nobody every got a job through church affiliations that results in incomes in the hundreds of thousands for all your members. That would be a sneaky and unchristian way to gather income and could fill positions with incompetent people,so we wont speak of it anymore…because it never happens…and all church people are entirely qualified for all their jobs…and its what you know not who you know at church…not a whisper of this made-up device to gather income…nope not one more word that nobody knows about how government and churches are basically the same in Cayman…

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    • Anonymous says:

      Have you seen how these “servants of God” live? @3:57 is right, they are not charities nor are most of them charitable.

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