In the summer of 2008, the US Senate Finance Committee was planning a hearing to discuss the results of a report that delved into the reasons why US companies and individuals use the Cayman Islands financial market. A particular target of the government inquiry was Ugland House, headquarters of the law firm Maples and Calder, which had drawn scrutiny for the number of companies that are using it as a registered office address. The final report, written by the US Government Accountability Office, contained many positive findings on the attractiveness of the Cayman Islands for structuring financial transactions, such as political stability and creditor-friendly laws, but these facts were in danger of being overlooked in favour of a negative view of the region as a so-called tax haven. 
 
Maples and Calder and its team worked to counterbalance this rhetoric and entrenched stereotypes with the GAO facts coming out of the report by informing key audiences about the positive role that the Cayman Islands financial market plays in the global economy, which is largely misunderstood outside of the capital markets or the finance departments of multinational corporations. Bringing balance to the discussion required a thoughtful approach to finding facts about the true uses of the Cayman Islands financial market, and working to bring attention to those facts. 
 
The need for a strong communications programme reached a peak in 2008 as legislators in Washington, DC and many European capitals sought greater enforcement of tax laws to close what they portrayed as a gap in the amount of taxes owed and the amount of taxes collected. In the United States, unsubstantiated annualised estimates of the so-called ‘tax gap’ ranged from US$100bn to US$300bn. The global financial crisis aggravated attitudes toward offshore financial centres, as stereotypes of lax regulation led many to suspect that offshore hedge funds had exacerbated market volatility. 
 
Antagonism toward offshore centres escalated further as governments tapped already stretched public finances – which were suffering from falling corporate profits – to stimulate their economies and prop up ailing financial markets. These efforts raised numerous questions about how governments would restructure their finances, preserve social programs and administer public services without further burdening businesses and consumers by raising taxes.
 
Ugland House became a convenient scapegoat in the anti-tax haven movement. Media coverage portrayed the approximately 18,000 companies using Ugland House as a registered office address as ‘shell companies’ using a Cayman address as a nominal headquarters in order to avoid onshore corporate income taxes. 
 
Facing these entrenched misperceptions about shell companies and lax regulations, Maples and Calder set out to inform key audiences about the type of work it performs, how offshore finance operates and the firm’s role in channeling capital to economically productive means in global economies. In addition, the firm sought to demonstrate that the Cayman Islands, through its laws and information sharing agreements, is a partner to the US government and has a history of cooperating on investigative matters.
 
The team built a case for the Cayman Islands based on the extensive number of treaties that the Cayman Islands government had signed to pledge its co-operation to police the financial system. The team added extensive research on the economics of offshore financial centres and anecdotal information from Maples’ lawyers on their client base and the offshore activities they engage in. The team also researched Cayman Islands investment funds to understand how they registered with Cayman monetary authorities and what accounting standards they use to report their financial performance. The research yielded examples of how the Cayman Islands meets or exceeds many international norms. 
 
The GAO report that the Senate Finance Committee had commissioned contained findings on how the Cayman Islands attract financial activity because of its stable political environment and legal protections for creditors, and not for tax evasion.
 
Concurrent with the hearing, lawyers from Maples and Calder provided this information to journalists who were seeking local commentary. Resulting media coverage that appeared on the day of the hearing included important facts that counterbalanced leaked negative excerpts from the report and corrected previously reported misconceptions. Providing useful and factual information in subsequent interviews has helped distinguish rhetoric from reality, neutralise the inflammatory language and shed light on how Cayman Islands investment funds help facilitate global liquidity by participating in the US government’s Troubled Asset Relief Programme. 
 
In summary, the results of this engaged approach – which stemmed from a thoughtful, research-based effort – has effectively provided important factual information to the market and informed a wide audience on the facts.