UPDATE 1-Defiant leader of Cayman Islands under pressure to resign
* Opposition leader says premier has to step aside
* Bush blames governor, says he's victim of "political witch hunt"
By Shurna Robbins
GEORGE TOWN, Cayman Islands, Dec 14 (Reuters) - Embattled Cayman Islands Premier McKeeva Bush faced growing pressure to resign on Friday after his arrest on suspicion of theft and corruption in the offshore Caribbean financial center.
A defiant Bush, who has blamed his troubles on the governor of the British overseas territory, has said since his detention that he did nothing wrong and has no plans to step down.
But opposition leader Alden McLaughlin, who took the first steps toward getting the premier removed by parliament on Friday, has publicly called on members of Bush's own cabinet to oust him and appoint someone from their own ranks to serve as head of the government.
"Mr. Bush is plainly treating the matter of his arrest with utter impunity and is determined to return to business as usual," McLaughlin said in a televised address on Thursday night.
"It is untenable that for the foreseeable future, business people will have to explain to any foreign investor or person doing business in Cayman how it is that the premier of the Cayman Islands continues in office after having been arrested and bailed on suspicion of having committed serious offenses," he said.
Bush, 57, was arrested on Tuesday by members of the Financial Crime Unit of the Royal Cayman Islands Police Service. He was released on police bail until February, pending the possible filing of criminal charges against him.
Authorities have declined to give specific details of the probe targeting Bush, saying only that it included allegations of theft and misuse of a government credit card.
Bush, who has been the target of active corruption probes for more than a year, told reporters in Jamaica on Thursday that he was the victim of a "political witch hunt" mounted by British-appointed Governor Duncan Taylor and other foes.
"This has damaged me politically and damaged the Cayman Islands," Bush said.
Bush was in Jamaica to deliver a commencement address at a university during which he called Taylor a "jealous governor" responsible for a "vindictive tirade" against him.
Steve Moore, who runs the governor's office in George Town, said Taylor had noted Bush's remarks and "there is absolutely no foundation to the allegations that the premier has made."
Bush said he would "love to tell the whole story" behind his arrest but had been told by his legal advisers to avoid going into details.
The veteran politician suggested he was just a native son of the Caymans, which share much in common with other parts of the Caribbean despite the wealth associated with territory's role as a global tax haven and offshore home to hedge funds.
"I come from a side of the street that some of them don't like," said Bush. "I didn't grow up as a wealthy person, I'm not a wealthy person, and some feel that I shouldn't just be there as premier."
McLaughlin, leader of the opposition People's Progressive Movement, said he filed a petition with the Speaker of the House, or head of parliament, on Friday urging her to convoke a special legislative session for next week to consider forcing Bush from office through a no confidence motion.
The petition, a copy of which was obtained by Reuters, said "the urgent meeting" should be convened "in order that the house may consider whether it continues to have confidence in the government led by Mr. McKeeva Bush following the premier's arrest by the Royal Cayman Islands Police."
Government officials, including Deputy Premier Julianna O'Connor-Connolly, could not be reached for immediate comment.
Bush also serves as finance minister of the Cayman Islands and holds considerable sway over the three-island territory and its population of 55,000.
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