Fraud Basics

Recovering illicit assets offshore might become a bit easier

Islands' laws could aid investigations



The British Overseas Territories (such as The Cayman Islands) and the British Crown Dependencies traditionally have been jurisdictions fraudsters use to hide proceeds of crime. However, recent legislation on the Islands could make it easier to conduct investigations into fraud and white-collar crime.

A fraud investigator obtains access to the bank statements of a company and discovers a wire transfer to another company in the Cayman Islands. The investigator knows the second company is located in a known tax haven and black hole when it comes to finding information about it. Has the investigation hit a dead end? No. The investigator has several options to identify who received the benefit of those monies.

Since I taught a breakout session on recovering illicit assets offshore at the 27th Annual ACFE Global Fraud Conference in 2016, I’ve seen several developments in offshore jurisdictions that will make investigating fraud and collecting information on corporate entities easier and more fruitful. However, it might also mean that those who aren’t willing to be transparent are moving their operations to less-transparent jurisdictions.

For the purposes of this column, I make a distinction between the British Overseas Territories — which includes the Cayman Islands, the British Virgin Islands and Bermuda — and the British Crown Dependencies — which include Guernsey, Jersey and the Isle of Man.



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