Prosecutors and law enforcement agencies in the Cayman Islands have access to a range of investigative tools under the Proceeds of Crime Act (2020 Revision) ("POCA"), Part VI.
Such powers include production orders, search and seizure warrants, disclosure orders, customer information orders and account monitoring orders.
This short guide, forming part of the McGrath Tonner's financial crime and anti-money laundering series, focusses on disclosure orders.
A disclosure order, available under sections 160 – 165 of POCA, provides a means by which law enforcement agencies can gather information.
A judge of the Cayman Islands Grand Court may, on hearing an application made by the (Office of the) Director of Public Prosecutions, make a disclosure order if satisfied that each of the statutory requirements is fulfilled, namely (section 161):
(a) there are reasonable grounds for suspecting that –
(i) in the case of a confiscation investigation, the person specified in the application for the order has benefitted from that person's criminal conduct; or
(ii) in the case of a civil recovery investigation, the property specified in the application for the order is recoverable property or associated property; and
(b) there are reasonable grounds for believing that information which may be provided in compliance with a requirement imposed under the order is likely to be of substantial value (whether or not by itself) to the investigation for the purposes of which the order is sought; and
(c) there are reasonable grounds for believing that it is in the public interest for the information to be provided, having regard to the benefit likely to accrue to the investigation if the information is obtained.
An application may not be granted in relation to a money laundering investigation (section 160 (3)).
An application for a production or entry order will be made ex parte to a judge in chambers (section 165(1)).
Once obtained, the disclosure order will authorise the DPP to give to any person (that the DPP considers to be in possession of information relevant to the investigation in question) notice in writing requiring that person to do any or all of the following:
(a) answer questions, either at a time specified in the notice or at once;
(b) provide information specified in the notice, by a certain time and in a manner so specified; or
(c) produce documents, or documents of a particular description, either at or by a time so specified or at once, and in the manner so specified.
A disclosure order may remain in force throughout the life of an investigation (and, indeed, until any court proceedings are concluded) (section 164(6)).
Limits and challenges
In contrast to the English Criminal Procedure Rules, the Cayman Islands Criminal Procedure Rules do not contain guidance on the process by which an application may be made or resisted. Some practical assistance may be derived by referring to the English CPR and the Code of Practice Issued Under the Proceeds of Crime Act 2002. There is also a body of local and English case law governing such applications however such detail is beyond the scope of this note.
Any application to discharge or vary the disclosure order may be made to the court by the person who applied for the order or by any person affected by the order (section 165(3)). Therefore, there exists an opportunity for an affected person to apply to court for relief prior to making disclosure. Challenges to the order may be brought, inter alia, on procedural grounds (failure of the applicant to comply with its duty of full and frank disclosure at the ex parte hearing), in relation to the limits of the court's powers (for example, jurisdictional issues), on the merits (challenging the existence of "reasonable grounds") and/or by seeking to narrow the scope of the documents to be disclosed.
A disclosure order shall not confer the right to require a person to answer any privileged question, provide any privileged information or produce any privileged document, except that a legal practitioner may be required to provide the name and address of a client (section 164).
A disclosure order shall not require a person to produce excluded material. Excluded material includes personal records which a person has acquired or created in the course of any trade, business, profession or other occupation or for the purposes of any paid or unpaid office and which that person holds in confidence (section 164(7)).
Subject to certain statutory exceptions, a statement made by a person in response to a requirement imposed on that person under a disclosure order may not be used in evidence against that person in criminal proceedings (section 163).
It should be remembered, however, that a person commits an offence if, without reasonable excuse, that person fails to comply with a requirement imposed on that person under a disclosure order or if he/she provides misleading information (section 162).
It is also an offence to interfere with or permit interference with a confiscation investigation, money laundering investigation or civil recovery investigation. Offenders are liable upon conviction on indictment to imprisonment for a term of five years or to a fine, or to both.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.