Registrar in Cayman Islands inflicts first penalties under new BO regime

In May 2020, the new beneficial ownership reporting system in Cayman Islands officially set off, affecting trust and company service providers (TCSPs), which not only have been required to report information on their beneficial owners, but also had to file ‘restriction notices’ which have limited companies’ rights to carry out certain activities, if they have not provided the required information.

The Cayman Islands Registrar of Companies (the Registrar) has been granted the power to impose fines for breach of the regime, with penalties being set at KYD5,000 for an initial breach, and monthly fines of KYD1,000 up to a maximum of KYD25,000 for continuing breaches. Entities that fail to pay in 90 days or refuse to comply may be struck off the register and dissolved.

As of today, the Registrar has sent warning letters to 18TCSPs and fined 19 companies for failing to comply with their duty and the new regulation.