CONFIDENTIAL
investigation had highlighted once again the difficulty of locating the necessary funds to mount an expensive and extraordinary operation in a DT, given that the FCO had no specific DT vote. Fortunately the Montserrat government had agreed to pay for the Fraud Squad operation to date, but its willingness to do so might
not last much longer.
but a
5. Dr Brewer returned to the point of liability, noting that HMG had not technically been liable in the Barlow Clowes case,
furore had still ensued. She had little new to report on the progress of the Coopers and Lybrand review. Mr Gallagher had been swept up into the Montserrat investigation, from which he had picked up important points of general application. His survey was likely now to concentrate on implementation rather than legislation. He was currently writing up his reports on Anguilla, Cayman and Montserrat, and would be visiting BVI and TCI (briefly) as from next week. He proposed to draw up a framework for implementation which would form the introduction to his report. He was likely to recommend the clawing back of control over the DT financial sectors,
but its immediate return to local control in the case of section
which were well administered and reputable. He would probably propose that the East Caribbean Central Bank should assume a more active supervisory role. (The High Commissioner in Bridgetown supported this idea.) Finally, Dr Brewer noted that the problems of establishing DT financial sectors extended wider than the Caribbean.
She cited the example of the proposed Gibraltar Stock Exchange.
6.
Mr Moody observed that Gibraltar was a special case among the DTS since the Territory was obliged to conform with EC financial sector legislation. The Stock Exchange project exemplified the problems of conformity with EC directives. The Gibraltar civil
service lacked the resources to translate EC legislation into a
local context. A proposal had been submitted to send a DS officer
to Gibraltar who would assist with the implementation of EC
legislation. The Governor of Gibraltar, of course, possessed
residual powers over the financial sector, and was able to claw back
responsibility for international finance. Mr Turner pointed out
that to date only one bank had been established in BIOT.
permitted to operate without a license. However a system of
It was
TT
སྐ སྐ སྡ /2
CONFIDENTIAL