By Simon English, The Independent

The Cayman Islands is a curious place. More than most islands it is insular and inward looking. Proud, but a little defensively so.

And a little prone to paranoia, perhaps, that it is being got at by American politicians, EU bureaucrats or meddling Brits.

You can hear this loud and clear in McKeeva Bush’s staunch dismissal of the allegations against him. It’s vindictive, he says, a political witch-hunt. His enemies are out to destroy him. He might have a point, or not, but his arrest seems symbolic of a place where all is not quite as it seems on the surface.

Is McKeeva – everyone calls him either that or just Mac – a man who rose from humble beginnings to become the islands’ most respected and most powerful politician? Or a small-time crook looking out for No 1?

In theory, the Cayman Islands is the sixth-largest financial centre in the entire globe. In reality, it’s a tiny place with a population of just 50,000, some of whom are foreigners who administer the hedge funds that base themselves in Grand Cayman for tax purposes. The funds are managed from Grand Cayman in a legal, administrative sense. The actual money is invested from New York and London by directors who may set foot on the islands for annual board meetings, but otherwise have little to do with the place.

You can get irritated at the Cayman Islands’ status as a tax haven if you like, but that’s how it pays for lunch, how it survives.

It doesn’t, in truth, have that much else going for it and Caymanians themselves feel some sense of shame that they sold out to finance just to live comfortably. Jamaica might be poorer, have more crime, but it’s got Bob Marley and a strong sense of its own identity.

The islands aren’t self-sufficient in anything, certainly not food, which arrives daily from Miami and beyond. Tourists are lured by the diving – some of the best in the world – and Seven Mile Beach is beautiful. Beyond that, well, there’s some good eating and drinking to be done but the odd hurricane aside – Hurricane Ivan devastated the Cayman Islands in 2004 – a visitor could get the impression that this is a place where nothing much happens. Twice.

Drugs are available if not rife, though the police have no sense of humour and punishment can be draconian. Otherwise, a fairly common source of diversion seems to be extra-marital affairs. Not out of wild bohemian edginess, more from boredom.

The allegations against Mr Bush will be a source of gossip in Grand Cayman bars. And some of those gossiping will remember that the folk doing the investigating – Royal Cayman Islands Police Service – aren’t entirely squeaky clean either.

A few years ago the police commissioner Stuart Kernohan was embroiled in a corruption case that saw him lose his job.  Mr Kernohan had moved to the islands following a scandal in the UK when he had an affair with a murder witness, whom he later left his wife for. If he came in search of a new beginning, the dream quickly went sour. Not everyone fits in.

For many Caymanians, typically conservative, Christian folk, the allegations against the premier will be an embarrassment they don’t want to discuss and don’t think is anyone else’s business.

Europeans or American who settle in the Cayman Islands for extended periods seem to get used the idea that it doesn’t pay to look too closely at the underbelly of society. If you want permission to stay, asking too many questions, being sceptical or sarcastic is a short route to an exit.

As for McKeeva Bush, he has been down on his luck before and come back. He may do so again.

One long-term island-dweller said of him: “He can be very charming and surprisingly softly spoken in private. Always very warm. Loyal to his friends. He was a long-time thorn in the side of the UK government – he has fallen out with most if not all governors and overseas territories ministers over the years. He was always very paranoid about the British role in Cayman.”

Simon English lived in the Cayman Islands from 2005 to 2006

COMMENT (Placed under article):

“You can get irritated at the Cayman Islands’ status as a tax haven if you like, but that’s how it pays for lunch, how it survives.”

No it is not.

Since the huge financial industry there does not to have to pay any taxes at all, the country’s inhabitants gains very little from it. The money is all going to the people in Wall street and the city of London. This is why the government of this British Overseas Territory went to the UK government with a begging bowl in 2009 asking the UK taxpayers to pay for its deficit. The idea that it was criminally absurd to ask British taxpayers to pay for services in the Cayman islands while people there did not pay any taxes at all did not cross their mind.

The Cayman island is the perfect place for the financial services industry since there they are not regulated, they are not supervised and not taxed. They do not have to contribute one iota to the country.

And it is all done as a part of the UK government’s tax avoidance scheme for its financial industry.

IT IS A DISGRACE FOR BRITAIN !

For more on this story go to:

http://www.independent.co.uk/news/world/americas/the-cayman-islands-a-place-that-has-sold-its-soul-to-finance-but-where-nothing-much-tends-to-happen-8418409.html