The Financial Times takes a look at the current property boom in the Cayman Islands and how anti-money laundering laws in the UK are now a threat.
Estate agents in the Cayman Islands, the largest of the islands in the British overseas territory, are braced for slowdown despite that at the moment demand for homes in the Cayman Islands is strong and developers are struggling to keep up with demand .
However, a shadow is being cast over the islands’ rising property market changes due to anti-money laundering rules in the UK .
In a move designed to prevent criminals from laundering dirty money through anonymous companies in offshore locations, an amendment was passed last summer to the sanctions and anti-money laundering bill. This forces 14 overseas territories, which include the financial centres of the British Virgin Islands and the Cayman Islands, to introduce public registers of companies’ beneficial owners by the end of 2023.
The Cayman Islands are the world’s most popular hedge fund domicile and between 50 and 65 per cent of the islands’ economy comes from financial services. A sector that employs roughly 7,000 people.
The fear is that with this amendment, the financial services industry as a whole might be impacted detrimentally with a knock-on effect on the real estate industry. On the other hand a slowdown in the current building boom will come as welcome news to some Cayman residents.
