Madoff fraud to spur offshore regulatory changes

The ponzi or pyramid scheme scandal has rocked Bermuda, the British Virgin Islands plus the Cayman Islands and has damaged the credibility of the fund industry's responses to those who sought to blame them for the credit crunch. The industry said it was the banks and not the funds which were at fault and light and flexible disclosure-based regulation was sufficient to protect investors. The argument have been weakened by the scope of the Madoff scam on the investor community, says Jeremy Walton, partner in the litigation practice group at the Cayman branch of Appleby. Although offshor...