Dear Sir,

Zane DeSilva’s call to boycott Butterfield Bank was actually a continuation of your banner headline of June 29 — “MPs call for CoI into island’s banks”. That headline was terribly misleading. At a minimum, it should have been “ Two MPs call for CoI into island’s banks”. That piece, along with the three reports around the Gaming Commission in the July 1 edition seem to me to be parts of the same puzzle.

The CoI piece basically outlines how two MPs — Zane DeSilva and Derrick Burgess — are complaining because they would not or could not conform to the same requirements that every other person in Bermuda has to comply with. What a pair of privileged crybabies! Step up, meet the requirements, obey the guidelines and stop moaning.

There were two other complaints raised, but neither they nor the two MPs’ own matters go any part of the way towards warranting a Commission of Inquiry or any other kind of official inquiry.

They were the usual red herrings.

The issue of released inmates can be worked around by the inmates’ families or any other person without a criminal record — perhaps Messrs DeSilva or Burgess might step up — who is prepared to trust the inmate in question. Let’s call them a “sponsor”.

The sponsor could open an account in their own name and then add the ex-inmate as a signatory. This would give the ex-inmate access to the utility of the account for whatever their legitimate needs were.

In time, this might also well be sufficient evidence of rehabilitation to allow the bank to trust them in their own right. Certainly, if a person has committed an offence which justifies curtailing their human right to liberty, then no one can realistically force a bank to extend to them the privilege of a bank account.

A second option, if the Government thinks the banks’ restrictions are too severe, is to return to the days when the Bermuda Post Office offered savings accounts. It is no far stretch to extend that to what might be called “basic banking services” — current or checking accounts, debit cards, perhaps online local transfers and payments. I am not aware that there are a large number of Bermudians who are actually unable to fulfil the requirements to get bank accounts. If that number goes beyond newly released inmates to include many others, then perhaps the “Post Office Bank” is the sensible option.

Finally, there is no reason that the Bermuda Industrial Union could not revitalise its credit union and offer banking services. Particularly if, like the “Post Office Bank”, it was to focus on so called “Lifeline Services” involving only local banking services.There is nothing in its way except an unwillingness to step up and operate within the same regulatory and governance guardrails as any other bank.

Then, right at the end of the CoI piece, we hear what I believe is the real issue. This is the part that connects the articles and is the real reason for the MPs’ indignation. The real issue that Mr DeSilva, Mr Burgess and David Burt, the Premier, have with the way banking is done here is that the local banks will not process “proceeds of crime” money from their much desired casino partners.

The reality that the gambling advocates want to ignore is that Bermuda’s banks — including HSBC, by the way — operate as “Bermuda” banks. They are tiny and have very limited reach, influence and capital. Their ability to operate internationally is entirely dependent on partnering with much larger international banks. The only way they can make those partnerships work is by being “cleaner than clean” when it comes to all the international banking rules and requirements. This is particularly the case where money laundering (AML regulations), tax avoidance (FATCA) and terrorism and crime-related issues are involved.

If there might be any loophole in the regulations around our casino operations that could remotely ever allow these money flows to be tainted in any way, the local bank would instantly be “cut off” by their international (“correspondent”) partners. Worse still, that would certainly result in the other local banks’ partners re-evaluating the risk to their reputations and standing from being involved with Bermuda banks as well. This could close down our international sector in the space of weeks. This is what is called an existential risk, not only to the banks but to Bermuda itself.

The interesting thing is that Everard Barclay Simmons knew all this and certainly did not have to charge the casino commission $175,000 for what he could have told them in five minutes. The answer looks like he might have been “consulting” with them to come up with schemes that would enable these flows of funds to bypass the local banks and their regulated partners.

The Progressive Labour Party is desperate to find an external banking partner — Caribbean, African, South American, Chinese, Middle Eastern — who it can somehow get to operate here to clear casino funds. Mr Simmons would be perfectly placed to identify and explore options with such partners to whom the smell of green is more attractive than the smell of illegal. A $175,000 “fee” to “grease the wheels” in this persuasion is pocket change.

This would be a disaster for Bermuda and would destroy not only the banking reputation that has taken more than 70 years to build and maintain, but our international business as well.

To continue to pursue this project is the height of bad governance. The PLP needs to step back before it gets too close to the whirlpool and is sucked in by the smell of the green.

JAN T. CARD

Smith’s

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