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We do not need to pause for long to observe that, on its face, this bears scant relation to the “overriding goal” of Rule 5.2, which says nothing of the kind. Rule 5.2 asks custodians not to commingle their clients’ assets with their own; an entirely workaday affordance that, to any half-competent [[trust and agency professional]], would hardly need being said. But within a couple of paragraphs, our [[CIMA]] ''ingénue'' overreaches this tepid lagoon, and her scanty mandate, and seems to pry into the famously private affairs of her [[hedge fund]] constituents. Rule 5.5 seems to bar one such as a [[prime broker]] from ''[[Rehypothecation|rehypothecating]]'' a Cayman fund’s assets. In a business as dependent on [[margin lending]] as is the [[Cayman Islands]]’ [[hedge fund]] industry, this is quite the intrusive bolt from the blue. The industry, and its divers professional advisers, rose up as one. “What,” it enquired, “on ''Earth'' do you think you are playing at?” | We do not need to pause for long to observe that, on its face, this bears scant relation to the “overriding goal” of Rule 5.2, which says nothing of the kind. Rule 5.2 asks custodians not to commingle their clients’ assets with their own; an entirely workaday affordance that, to any half-competent [[trust and agency professional]], would hardly need being said. But within a couple of paragraphs, our [[CIMA]] ''ingénue'' overreaches this tepid lagoon, and her scanty mandate, and seems to pry into the famously private affairs of her [[hedge fund]] constituents. Rule 5.5 seems to bar one such as a [[prime broker]] from ''[[Rehypothecation|rehypothecating]]'' a Cayman fund’s assets. In a business as dependent on [[margin lending]] as is the [[Cayman Islands]]’ [[hedge fund]] industry, this is quite the intrusive bolt from the blue. The industry, and its divers professional advisers, rose up as one. “What,” it enquired, “on ''Earth'' do you think you are playing at?” | ||
Of course, this was not what [[CIMA]] meant at all, and there followed a hasty | Of course, this was not what [[CIMA]] meant at all, and there followed a hasty “reverse ferret”. But in that fascinating way of modern life, wherein it will no longer do to just admit to a cock-up and fix it properly, websites were updated, correspondence reissued, and the guidance was ''clarified''. “For the purposes of Rule 5.5,” the [[amended]] circular carried on, “the following shall not in itself, constitute the financing of the Service Providers own operations: | ||
:''{{helvetica|use or transfer of assets as consented to [[by or on behalf of]] the Fund, [[provided]] that the possibility of use or transfer is disclosed ... to investors.}}'' | :''{{helvetica|use or transfer of assets as consented to [[by or on behalf of]] the Fund, [[provided]] that the possibility of use or transfer is disclosed ... to investors.}}'' | ||