CIMA Investment Schemes Warning (2017-10-17)

Summary

This is a public investor-warning notice issued by the Cayman Islands Monetary Authority (CIMA) in October 2017, cautioning the Caymanian public about unregulated 'investment schemes' or 'investment clubs' soliciting funds with promises of unusually high returns. CIMA notes that most of these entities appear to be based in or operating out of Jamaica, and references the collapse of Cash Plus Limited in Jamaica as a cautionary example, where investors lost money due to a Ponzi-like structure, poor recordkeeping, and an unsustainable business model.

• Licensing reminder: Anyone conducting securities investment business, as defined under the (then-applicable) Securities Investment Business Law, must be licensed by or registered with CIMA.
• Investor guidance: Investors and potential investors should obtain full information about any entity, investment product, and the persons they are investing with before committing funds.
• Related enforcement: The notice references warnings and cease-and-desist orders issued by the Jamaica Financial Services Commission against similar unregulated ventures.

This document is informational and cautionary in nature rather than a binding regulatory instrument. It does not create new legal obligations for licensees or regulated entities, but restates the existing licensing requirement for securities investment business and urges public caution regarding unregulated investment schemes.

Key obligations

• Persons conducting securities investment business, as defined by the Securities Investment Business Law (2004 Revision), must be licensed by or registered with CIMA.

Applies to

persons conducting securities investment business, investors and potential investors