Strong support for the manner in which business is conducted in Bermuda came yesterday from the man who headed up an investigation into financial regulation in Britain's Overseas Territories.

Marcus Killick, a top consultant with the accounting firm KPMG whose Foreign and Commonwealth Office-commissioned report was made public on October 30, said Bermuda was among the best equipped to survive criticism of offshore financial centres.

As the guest speaker at the annual general meeting of the Bermuda International Business Association (BIBA) held yesterday, he had high praise for Bermuda.

"The cards in the offshore debate are marked and the deck is stacked against offshore centres,'' said Mr. Killick. "However it is a deck of cards which offshore must play and in my view, play it shall, and win, it certainly can.'' Admitting that offshore centres are increasingly being treated unfairly and asked to adhere to stricter rules than their onshore counterparts, he advised that they stand their ground.

"Many of the crimes that are being committed onshore are having the blame laid at the door of the offshore,'' he said.

"It is always easier to blame someone in a faraway land with little political or economic clout than to accept fault of oneself,'' he added. "It is much easier for a Colombian drug dealer to set up a money laundering bank account in England or New York than it would be in Bermuda.'' Particularly impressed with the absence of secrecy laws in banking on the Island, Mr. Killick said Bermuda had positioned itself well to continue its success in the coming years.

"Confidentiality will be continued to be highly valued but secrecy, particularly in the form of stringent laws, will be seen by many as a hindrance rather than a help,'' he said.

Mr. Killick said the areas of regulation, intellectual mobility and innovation will determine the degree of success or failure of financial centres in the future.

An advocate of training locals for the job market and using the local work force as much as possible, Mr. Killick also pointed out the dangers of not allowing foreign expertise in.

In an increasingly competitive marketplace he said there will be a move "to bring the brightest and the best to you''.

"However the process must be properly and effectively managed and those from other countries who come and provide the talents that are necessary to help the jurisdiction do have an element of security, for as time goes on the lack of that security will be a disincentive to them, it will be a disincentive to their employers and there will be other jurisdictions who would be delighted to provide that comfort.'' Mr. Killick advised that "effective'' rather than "abundant'' regulation was the best method for jurisdictions to adopt and he noted that flexibility and consultation with the private sector, are good avenues to take in this area.

"Those jurisdictions whose regulations are tested against whether they achieve the key objectives of regulation will be the ones to succeed as they will achieve the correct balance,'' he said.

"In the most progressive centres the private sector will actually help in that regulation by working hand in hand with the regulators to develop effective regulation and those key objectives.

KMPG consultant speaks "Disagreements between the regulator and the private sector, will occur and are healthy provided they are behind closed doors. Public disagreements will serve neither party and only serve to discourage potential clients,'' he said.

With the erosion of secrecy, Mr. Killick said greater dependence will be placed on innovation. He said offshore jurisdictions are much better suited to adapt than their onshore counterparts.

"Because of the size of the jurisdictions involved, because of the connections of the public and private sector, because of the mutual trust and confidence that can build up,'' he said, "offshore centres can develop new products, can develop new legislation, develop new lines far faster than their onshore counterparts.

"This means that they can always be ahead of the game.'' BUSINESS BUC