Cayman's Lawyers Call For FRU Shake-Up Following Collapse Of Euro Bank Laundering Trial

by Amanda Banks, Tax-News.com, London

30 January 2003

According to a report from the Cayman Net News service this week, the Cayman Islands Law Society and the Caymanian Bar Association have called for the jurisdiction's Financial Reporting Unit (FRU) to be restructured following the collapse of the Euro Bank money laundering trial earlier this month. The legal bodies have also called for the resignation of Attorney General, David Ballantyne.

The trial collapsed when it emerged that the Director of the Cayman Islands Financial Reporting Unit, Brian Gibbs had destroyed crucial evidence following a tip-off from an unidentified UK government agency that his home was about to be raided. Chief Justice Anthony Smellie was forced to acquit the four accused Euro Bank Corporation officers: Brian Cunha, Ivan Burges, Donald Stewart, and Judith Donegan, when the Attorney General offered no further evidence against them.

In a statement, the Law Society and Bar Association announced that:

'It is clear from the Chief Justice's findings in the Euro Bank trial that the Financial Reporting Unit (FRU) has been operating in an illegal manner. Therefore it is important that the FRU should, as soon as possible, be restructured to ensure that in future it will operate both effectively and lawfully.'

'It is essential that confidence be restored, in the Cayman Islands and elsewhere, that this is a jurisdiction that deals effectively with money laundering and other financial crime and cooperates fully with other jurisdictions but in which the rule of law is inviolable.'

According to the Cayman Net News, the two groups also suggested that Mr Ballantyne was in part to blame for the failure of the case, arguing that:

'In any event, there have evidently been very serious failures in both the investigation and prosecution of the Euro Bank case, for both of which the Attorney General has ultimate responsibility. The Cayman Islands Law Society and the Caymanian Bar Association believe that the continuation in office of the present Attorney General would make it impossible to...restore confidence.'

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