Offshore banks need to keep a closer eye on their customers' investments to pick up on Ponzi schemes.

That is the view of Owen Henry of the Cayman National Corporation, who highlighted the case concerning the 'Cash 4 Titles' scheme in which the Bank of Bermuda (Cayman) became embroiled and later settled out-of-court for $67.5 million, as an example of banks needing to be more aware of such scams.

Mr. Henry was speaking as a panellist on the current trends of serious financial crime in the Bermuda-Caribbean region and the steps being taken to combat it at the OffshoreAlert Financial Due Diligence Conference held in Miami this week.

"As an internal auditor and a banker, I am concerned that the banks need to pay more attention to these schemes," he said. "The challenge from knowing a customer standpoint is knowing what extent are banking institutions really looking at these schemes."

Rodney Gallagher, of Gaffney, Gallagher & Philip in Barbados, who was also speaking on the panel, along with Sharda Sinanan-Bollers, of the International Financial Services Authority in St. Vincent & the Grenadines, and moderator Martin Livingston, of Maples and Calder in the Cayman Islands, said that jurisdictions' legal and investigative frameworks had been enhanced over the past 10 to 15 years in response to the increasing sophistication of the challenges they faced.

He said that criminal enterprises had become more global and advanced since the days of the Montserrat banking crisis in the 1990s up to the modern-day alleged fraudster Allen Stanford.

"The laws and regulatory structures are responding always slightly behind the curve to the criminal threats that they are investigating and dealing with," he said.