Hedge funds, and offshore funds in particular, often require secrecy to protect their trading strategies, market positions and sensitive information about their investors. However, at the same time as investor demands are driving managers to provide more information on their investments, so the demands of regulators, both onshore and offshore, are obliging funds and their managers to disclose more information.
There is a prevailing myth that all business conducted in the Cayman Islands is veiled in an impenetrable cloak of secrecy. Not so. Although the legitimate right to privacy is respected in the Cayman Islands, it is arguable that, in comparison, onshore jurisdictions such as the UK, Germany and the US currently have more regimented regimes of privacy and data protection. Indeed, there are a number of circumstances in the Cayman Islands where confidential information must or can be disclosed, subject to appropriate safeguards.
