Lowtax Network

Back To Top

America Goes To War Against - wait for it - The Cayman Islands

Jeremy Hetherington-Gore Unleashed
08 June, 2007

Politics is rather like Alice in Wonderland: you chomp on a little pill called 'Power' and all at once you see dragons instead of dormice. This week, chief US Senate dreamweaver Max Baucus (Democrat - Montana) wants to send a GAO team to the Cayman Islands to investigate a nest of anti-American activists housed in a sinister 5-story building called Ugland House.

'I want the GAO to go looking in one of the most likely places shady tax transactions could be sheltered, and that’s this building in the Caymans,' said Baucus. 'The Ugland House office building in the Cayman Islands has been the source of much debate on the Senate floor over the past few years. It’s time the Finance Committee found out what’s really going on there,' echoed deputy necromancer Senator Chuck Grassley.

And what will the GAO swat team find when it bursts its way into the heavily-defended fortress of Ugland House? Oh, Maples and Calder's very polite receptionist. Maples and Calder is the largest law firm in the Cayman Islands and has practised Cayman Islands law for more than 40 years. The firm opened additional offices in Hong Kong in 1995, London in 1997, the British Virgin Islands and Jersey in 2004, Dubai in 2005 and Dublin in 2006. It now has over 550 lawyers and staff worldwide.

But of course neither Senator actually believes anything will be learnt from this GAO jolly, which will give some staffers a well-earned holiday at the taxpayers' expense. This is just a piece of political theatre, another step forward in the demonisation of 'offshore'. It suits American politicians to play such games in front of their constituents.

The response of the Cayman Islands government to this latest jab from Capitol Hill is to say, rather wearily: 'Law enforcement, regulatory and tax information exchange channels between the Cayman Islands and U.S. – some dating back more than 20 years – offer no protection for Americans who are seeking to evade their tax obligations. The Cayman Islands has solid working relationships with the Treasury (including the IRS), the SEC, and the Department of Justice; a product of extensive cooperation between our two countries.'

'Substantially all of the answers to the questions that the Senate Committee on Finance is requesting the GAO collect are fully in the public domain,' adds the Cayman official.

The GAO, a more sensible and realistic organization than the Senate, knows very well that nothing will be achieved on its trip, conceding that the GAO "may be limited in its ability to obtain information in the Cayman Islands".

If the honourable senators really want to find out what is going on at Ugland House, why don't they give Gus Pope a ring on +1 345 814 5570; he is Maples' listed contact for the Cayman Islands. Gus has practised with Maples and Calder in the Cayman Islands since 1987 and as a partner since 1992. He is consistently ranked in international legal guides as one of the leading lawyers in the Cayman Islands and is actively involved on governmental committees relating to the funds industry in the Cayman Islands. Gus also currently serves on the management committee of the firm. He graduated with a law degree from Cambridge, and has an LL.M degree from the University of Pennsylvania where he was a Thouron Scholar, so he probably speaks American.


About the Author

Jeremy Hetherington-Gore Unleashed

Jeremy tackles the difficult issues head on!


« Go Back to Blogs

Blog Archive

Event Listings

Listings for the leading worldwide conferences and events in accounting, investment, banking and finance, transfer pricing, corporate taxation and more...
See Event Listings »