December 5, 2020

Eagle Mountain has $2.5M in [Cayman Islands] offshore account

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511c92c35f1fb.preview-620Caleb Warnock – Daily Herald

It’s true. Eagle Mountain has $2.5 million in an account in the Cayman Islands.

Why is not so clear. Eagle Mountain officials said they would like to know why the account is offshore. Late Monday, Eagle Mountain officials told the Daily Herald they had not known the account was physically located in Grand Cayman until they were forwarded an email from Zions Bank to the Daily Herald confirming the account’s location. Everyone contacted by the Daily Herald emphasized that the account is legal.

The existence of the account came to light on Feb. 13. In a 5-hour-long town hall meeting in which elected officials defended themselves against what they said were false charges in a viral online report, city manager Ifo Pili, apropos of nothing, said a resident had “reported we have an offshore bank account. There is a Cayman account, named by Zions Bank. A lot of cities have it. It was our operating account. Zions named it the Cayman account.”

The pronouncement was unusual because it seemed to come out of the blue — no one in the meeting had mentioned the issue. In the days following the meeting, city officials referred questions to Zions Bank.

Zions Bank repeatedly agreed to and then deferred interviews with the Daily Herald, but on Monday, while saying bank officials were too busy to be interviewed, a bank spokeswoman confirmed Eagle Mountain’s checking account is physically located in Grand Cayman.

“The Gold International account is an interest-bearing overnight deposit account at Zions Bank’s branch in Grand Cayman,” senior vice president communications manager Heidi Prokop wrote. “Gold International Sweep deposits never leave Zions Bank” and are “one of the highest-yielding investment options offered by Zions Bank to commercial and municipal clients.”

Eagle Mountain officials said other local cities also use a Grand Cayman account through Zions Bank.

Why the account is offshore is unclear.

Pili told the Daily Herald there is about $2.5 million in that account, and it is the city’s everyday checking account. He said he became aware of the Grand Cayman association after getting a text from someone in the state auditor’s office, telling him a resident had been asking about the legality of the account.

The existence of the account “didn’t alarm” the state auditor’s office, and the text was informational, Pili said. He had not been aware that the account was physically located offshore, but said it is possible someone in the city knew the account was offshore when it was opened. Pili emphasized that he has full faith in Zions Bank and their statement that the account is legal.

“I didn’t know they had a branch in the Grand Cayman,” Pili said. “I know there are some negative perceptions about having some type of offshore Grand Cayman account. That sounds bad.”

The city has the account simply to get a higher interest rate, he said, noting he believes the city is getting about 1 percent interest on money in the account.

He said that, after hearing concerns from Eagle Mountain and officials from other local cities, Zions Bank removed the words “Grand Cayman” from the account records.

City spokeswoman Linda Peterson said repeatedly that “a large part” of the explanation about why the account is located offshore “needs to come from the bank.” She emphasized that the city has full faith in the statement from bank officials saying the account is legal.

PHOTO TAG: City administrator Ifo Pili addresses the concerns of citizens during a town meeting at the Eagle Mountain city hall on Wednesday, Feb. 13, 2013. Mayor Heather Jackson convened the meeting to discuss the concerns of residents after a citizen’s report alleged mismanagement of the city’s utilities, employee salaries, and other issues. SPENSER HEAPS/Daily Herald

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