Angry over bank secrecy, Cayman Islanders oust leader

GEORGE TOWN, Cayman Islands (AP) -- Voters ousted the leader of the Cayman Islands and two of his ministers, showing their anger over the weakening of secretive banking laws have made this British Caribbean territory one of the wealthiest places in the world.

Truman Bodden, the leader of government who was also planning minister, lost his seat in general elections Wednesday, according to results announced late Thursday.

Also ousted was Tourism Minister Thomas Jefferson, who with Bodden led negotiations with international groups that have accused the Cayman Islands of protective laws that encourage money laundering and tax evasion.

Only one member of the negotiating team, legislator Linford Pierson, kept his seat.

Another loser was Agriculture and Communications Minister John McLean Sr., who had served 24 years in the legislature.

In all, seven new legislators were elected and eight incumbents held onto their seats. Five incumbents lost their seats and two retired. More than 80 percent of voters participated.

The new legislature is to meet Wednesday to choose a Cabinet.

Cayman Islands has only 33,000 people but is the world's fifth largest banking center, thanks to its no-tax regime, lenient regulations and strict confidentiality laws.

In June, the Cayman Islands was put on two blacklists of countries judged tax havens and noncooperative in the fight against money laundering.

Within weeks, Bodden rushed through legislation limiting banking secrecy, introducing legal requirements for customer identification and record keeping and for banks to cooperate with foreign investigators.

The government said at the time it expected to be speedily removed from the blacklists, but that did not happen during a review last month by the Paris-based Financial Action Task Force that was set up by the Group of Seven most industrialized nations.

Cayman Islands relies heavily on foreign business and is home to more than 570 banks and trust companies, 2,238 mutual funds and 499 captive insurance companies. Some 40,000 offshore companies are registered here.

Copyright 2000 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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