Minister of Financial Services the Hon. Tara Rivers visited Washington, DC, last week, where she explained the Cayman Islands financial services industry, and its adherence to regulatory and tax transparency standards, to influential US Senators, Members of Congress, senior Congressional staff, and other US thought leaders and influencers.

This trip followed her visit in April this year, when Minister Rivers attended similar meetings on Capitol Hill, and with the US Treasury and State departments.

In addition to continuing the discussions about Cayman’s industry and regulatory compliance, Minister Rivers again spoke with lawmakers on the potential effect of bank de-risking on Cayman residents and businesses. Her meetings were part of the Ministry’s ongoing engagement efforts in the US Capitol, which are intended to ensure that decision-makers in the US Congress are aware of the longstanding beneficial financial services relationship between the US and Cayman.

The Department of Financial Services Policy and Legislation’s Director, Mrs Michelle Bahadur, accompanied Minister Rivers on this trip.

On 17 July, Minister Rivers and Mrs. Bahadur met with Senator John Cornyn, the Assistant Majority Leader of the US Senate and member of the Senate Finance and Judiciary Committees.  Cornyn, who is from Texas, is the second highest-ranking Republican Senator.   Minister Rivers briefed him on Cayman’s strong record in adopting and enforcing international standards for tax transparency and information sharing, to dispel the myths that have persisted in the US about Cayman.

‘For many years, Cayman has worked hand in glove with the US Treasury and by extension, the IRS, to ensure that Cayman cannot be used to avoid US taxes’, she said.

‘Cayman shares tax information with US Treasury and the IRS through US FATCA and prior to that, in 2001, we signed a bilateral agreement that fulfilled a similar purpose’, Minister Rivers explained. ‘Likewise, we share tax information with more than 100 countries around the world through the OECD’s Common Reporting Standard.

‘Sharing information globally allows tax authorities to better ensure that taxpayers pay their taxes in the countries in which they are due’.

Minister Rivers also briefed Senator Cornyn about Cayman’s requirements for beneficial ownership disclosure upon the formation of companies, contrasting this with the lax rules on beneficial ownership in US states such as Delaware.  Senator Cornyn expressed surprise about the depth and breadth of Cayman’s laws, and agreed that US Senators making statements to the contrary in public hearings are incorrect.

Minister Rivers then met Senator Chuck Grassley (Republican-Iowa), to outline Cayman’s regulatory standards. Senator Grassley is Chairman of the US Senate Committee on the Judiciary, and a senior member of the Senate Finance Committee. As the co-sponsor of a Senate bill that would impose civil and criminal penalties in the US for providing false or fraudulent beneficial ownership information for corporations or limited liability companies, Senator Grassley was keen to hear about Cayman’s experiences in developing and implementing our beneficial ownership framework.

Minister Rivers also visited with Senate Committee on Banking, Housing, and Urban Affairs Chairman Mike Crapo (Republican-Idaho) to promote Cayman’s strong financial regulatory regime and to underscore the impact of de-risking for Cayman financial institutions, money transfer providers, and individuals.

As the committee’s Chairman, Senator Crapo has oversight power of the Federal Reserve Bank and the US Treasury’s financial services powers.  Senator Crapo is also a senior member of the Senate Finance Committee. He promised Minister Rivers that he would look into the loss of banking services to certain customers in Cayman because of de-risking programs by US banks.

During her meeting with Rep. Blaine Luetkemeyer (Republican-Missouri), who serves as Chairman of the House Subcommittee on Financial Institutions and Consumer Credit, Minister Rivers thanked him for holding a public hearing earlier in July on the effects of bank de-risking. She noted that as part of the proceedings, the specific impact of de-risking on Cayman was mentioned.

Chairman Luetkemeyer expressed strong interest in Cayman’s concerns and suggested that he would continue to shed light on de-risking in his subcommittee.  He also promised to learn more about Cayman’s robust financial regulatory regime and the effect of bank de-risking on Cayman.

Minister Rivers addressed similar issues in a meeting with a senior professional staff member for Senator Sherrod Brown (Democrat-Ohio), the Ranking Democrat on the Senate Committee on Banking, Housing, and Urban Affairs.

Minister Rivers capped her visit to DC by speaking before more than 75 guests at a cocktail reception held in her honour. The event was hosted by the Global Women Innovation Network (GlobalWIN) and Pillsbury Winthrop Shaw Pittman, LLP, which assists the Cayman Islands Government with US legal counsel.

Co-chaired by several female Members of Congress and Senators, GlobalWIN is a US-based bipartisan, non-profit organisation featuring executives and thought leaders in academia, government, and innovation-driven businesses.  At the GlobalWIN reception, Minister Rivers and Mrs Bahadur were honoured by leaders from Congress, US federal agencies, other embassies (including the Embassy of Israel), and innovation-driven companies, including Microsoft, Google, and Facebook.