Privacy Oriented

I was reading the Offshore section of the TalkGold Forum a while back, and I’d noticed this post. It says the following about Loyal Bank, an offshore bank headquartered in Saint Vincent and the Grenadines.

This is their policy on banking secrecy:

“The Bank had the right to cooperate with national and foreign authorities in information provision in cases where official investigation is being carried out on a client or there is official request for information with reference to an investigation.”

I contacted Loyal Bank to inquiry if this meant a court order and I was told, “No, an official request can be a phone call or faxed letter from an police or legal authority.”

LOL, you might as well bank in the US and save money rather than pay Loyal’s very high fees.

Loyal Bank is the worst bank in Caribbean.

That got me wondering… is that so? Surely banking secrecy is stronger than that by law in St. Vincent. …right? Well, I didn’t look up the law, but I did e-mail Loyal Bank and ask them a serries of questions about this. In fact, I didn’t just stop there. I asked a slew of Caribbean area offshore banks the same questions in e-mails and the following is what I’ve learned after one week’s time from when I sent the initial messages…

First of all, to start out this story properly, I should tell you the questions I asked and how I did it. For the how, I just e-mailed them all from my e-mail account. The who, when and what I asked are as follows:

All on Wednesday, October 29th, 2008 at about 4:00 AM (somewhere) I sent the e-mails, one after the other with the same questions and subject line.

THE BANKS

St. Vincent’s Safe Harbor Bank, Antigua and Barbuda’s Global Capital Bank, Stanford International Bank and Antigua Overseas Bank, Anguilla’s National Bank of Anguilla (International), St. Lucia’s Bank of Saint Lucia International, along with Hallmark Bank & Trust Ltd. and BIBT of the Turks and Caicos Islands,  and also Griffon Bank and Private Capital Bank the two of which are chartered in the Commonwealth of Dominica.

October 30th, I e-mailed: St. Vincent’s Loyal Bank, DGM Bank of Barbados, Atlantic International Bank, Caye Bank and Provident Bank of Belize, and NCB Cayman.

THE QUESTIONS

Dear bank rep,
I have some questions about banking secrecy at your bank. I hope you’ll be glad to answer them. Here they are:

Under what conditions will the bank share information on its clients?

Does there have to be a government investigation underway? Does that matter?

If so, who can conduct this investigation?

Does it take a court order? Is an official request good enough?

Thanks and I hope you’ll answer my questions as best you can.

THE RESULTS

ANSWERS AFTER APPROX. ONE WEEK’S TIME HAS PASSED:

The e-mail I sent to Dominica’s Private Capital Bank immediately bounced, so I sent another to their main e-mail address: info@privatecapitalbank.net …That bounced too. I can only conclude that their tech guys are incompetent, but I already knew that when I saw that their site was built entirely in Flash. The e-mail to BIBT in TCI also bounced.

Gifta Dujon-Francois from Dominica’s Griffon Bank was the quickest, e-mailing me back the next day with answers.

Under what conditions will the bank share information on its clients?
The Bank shares information upon request from our regulators. They are
The Financial Sector Supervision Unit (FSSU) and the Financial
Intelligence Authority (FIA). The request can be made under the
following circumstances: where the bank reports suspicious activity,
where a request is initiated by another jurisdiction to the FIA and
where the FIA is carrying out their own investigation. Disclosure of
client information to any person other than the regulators is an
offence.

Does there have to be a government investigation underway? Does that
matter?
The type of investigation is irrelevant if the request for information is being made by the regulators.

If so, who can conduct this investigation?

[NO DIRECT ANSWER]
Does it take a court order? Is an official request good enough?

A court order is not necessary for the regulators to request information. Their
authority allows them to visit a financial institution at any time and
request information.

Please let me know if this is what your required.

On October 31st, Joy Flowers (what a name!) of Belize’s Caye Bank e-mailed me back with answers.

Under what conditions will the bank share information on its clients?
Belize has very strict Secrecy Laws and Regulations. The Financial
Intelligence Unit was established in September 2002. Their role is
primarily for the investigation and prosecution of Money Laundering and
other financial crimes.

Information will only be released to a third party upon proof of wrong doing
and that a financial crime has been committed. Such proof must be by way of
documentation from a competent authority such as the courts.

Does there have to be a government investigation underway? Does that
matter?
[Joy Flowers] Even if there is a government investigation underway, this is
not sufficient proof that a crime has been committed. It is still “hear
say” until proven otherwise.

If so, who can conduct this investigation?
[Joy Flowers] Investigations of Financial Crimes or money laundering
activities can only be conducted through the Financial Intelligent Unit in
Belize.

Does it take a court order? Is an official request good enough?
[Joy Flowers] An official request by and in itself is not good enough. There
must be proper documentation to substantiate the claim and/or request for
information.

I find that kind of strange because, from what I’ve read and contrary to popular belief, Belize has no legislated or regulated banking secrecy.

On November 3rd (five days later) I recieved a response from Gabriella Pfeifauf of St. Vincent’s Loyal Bank, the bank that kicked off this whole inquirey. And I quote…

Under what conditions will the bank share information on its clients?
If the client gives us expressed consent to do this in writing, if compelled to do so under law. These laws include the Proceeds of Crime and Money Laundering (prevention) Act

Does there have to be a government investigation underway? Does that matter?
Any request for an investigation should come through the competent authorities.

If so, who can conduct this investigation?
This is usually the competent authorities such as the Financial Intelligence Unit which is established by Parliament.

Does it take a court order? Is an official request good enough?
A Production Order MUST be presented through our Court. We do not act on requests from other institutions. If approached we advise the party to contact the authorities who will guide them through protocol and process.

The rest of the Banks I contacted have not answered because, as everyone knows, it’s very hard to answer an e-mail if you’re only given one week.  Or maybe they’re just lazy or don’t know how to type and click buttons, or they’re just not very service oriented or non-client friendly …or the benefit of the doubt: they’re so used to keeping their mouths shut that they did not answer my e-mails. ha! I wish!

Has anyone had any experiences with these or other Caribbean banks they want to comment on? Anonymous comments are enabled. Cheers.