BVI considers tough prison sentences for data leaks

Last week, we reported that the British Virgin Islands was considering a tough new law that would add teeth to its already formidable financial secrecy protections. The proposed law would crack down on data leaks with prison sentences of up to 20 years for individuals who leak secret data and 15 years for journalists who publish those leaks.

The day after our story was published, the International Press Institute, a nonprofit organization that defends press freedom, issued a statement warning that the proposed law would have a chilling effect on freedom of the press in the BVI.

"While the protection of privacy and secrecy can be a reasonable government aim, we fear that the wide net cast by this bill could lead to the criminalization of legitimate journalistic activity in the British Virgin Islands," the Institute’s Press Freedom Manager Barbara Trionfi said in the statement.the BVI. 

The Institute called for an exemption to be added to the law so that journalism that serves the public interest would not be subject to penalty. Without such an exemption, it warned, the bill’s lack of specificity about what data leaks it covers, as well as the tough prison sentences it envisions, would have a chilling effect on the media.

Trionfi also expressed concern in her comments that while the bill includes a provision outlining penalties for disseminating child pornography, the maximum sentences envisioned for this offense are only half as long as the prison terms facing individuals who leak secret data. 


February 11, 2014

The British Virgin Islands have never been accused of taking financial secrecy lightly. But last week, members of the BVI legislature took a step toward raising the territory’s noted secrecy protections to new heights.

A bill introduced in the BVI legislature, the Computer Misuse and Cybercrime Act, would impose tough criminal penalties on individuals who leak secret data and journalists who publish those leaks.

These punishments include prison sentences of up to 20 years for individuals who illegally leak 

data, and sentences of up to 15 years for anyone who publishes data that “he or she knows or ought reasonably to have known was obtained without lawful authority.” 

The new legislation follows a year of revelations based on secret BVI account information that was leaked to ICIJ.  ICIJ’s reporting uncovered prominent politicians and business leaders, as well as Ponzi schemers, fraudsters and criminals, among more than 100,000 offshore entities contained in the hidden files. Many of these files belonged to the BVI-based offshore services firm Commonwealth Trust Limited.

In the aftermath of Offshore Leaks, various reports have indicated the heavy toll that the disclosures have taken on the offshore economy and the BVI in particular.

An industry survey by the company Offshore Incorporations Limited concluded that ICIJ’s reporting had caused a “crisis of confidence” in the offshore industry. More than three quarters of the offshore professionals surveyed said that ICIJ’s stories have reduced demand for offshore financial vehicles or prompted clients to move their business from one haven to another.

In the BVI, incorporations of new companies have declined sharply. Data released by the BVI Financial Services Commission from 2013’s third quarter showed a 21 percent decrease from 2012.

The BVI’s new anti-leak legislation went through the first of three required readings in the legislature last week, formally introducing it to the docket. In addition to these readings the bill must also obtain the assent of the BVI governor to be enacted into law, an approval that is routinely granted. 

Several offices of the BVI government, including the Office of the Attorney General and the Clerk of the House of Assembly, did not respond to ICIJ’s telephone and email inquiries about the legislation.

 

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