Offshore funds play an integral role in most private fund structures. Foreign investors appreciate the anonymity that these vehicles provide from U.S. tax authorities, while U.S. tax-exempt investors often prefer offshore corporate vehicles to shield them from receiving Unrelated Business Taxable Income. As the preferred offshore fund venue, the views and actions of the regulators in the Cayman Islands significantly impact most U.S. managers. In a recent interview with the Hedge Fund Law Report, Garth Ebanks, Deputy Head of the Investments and Securities Division at the Cayman Islands Monetary Authority (the Authority), provided his insights on the most salient issues from the perspective of a local Cayman regulator. This first article in our two-part series provides Ebanks’ thoughts into how managers are using the much-anticipated Cayman Islands limited liability company structure; how the Authority approaches the regulation of different types of private funds and other fund governance issues; and common deficiencies by private funds identified by the Authority concerning anti-money laundering and other applicable supervisory regulations. In the second installment, Ebanks will discuss the steps being taken by the Authority to ensure that Cayman vehicles are well positioned to obtain a marketing passport under the Alternative Investment Fund Managers Directive; three important regulatory initiatives being pursued by the Authority; the new Cayman Islands whistleblower law; and how the Cayman Islands has remained competitive as an offshore funds jurisdiction despite an onslaught of competition. For additional commentary from Ebanks, see our two-part series highlighting the views of U.S., U.K. and offshore regulators: “Best Ways for Hedge Fund Managers to Approach Regulation” (May 12, 2016); and “Cybersecurity, AML, AIFMD, Advertising and Liquidity Issues Affecting Hedge Fund Managers” (May 19, 2016). For more on offshore funds, see “Offshore Fund Vehicles: Do U.S. Investment Managers Need Them?” (Feb. 4, 2010).