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London ballroom hosts showcase event for 'golden passports'

The Guardian logo The Guardian 16/11/2019 Rupert Neate Wealth correspondent
a close up of a sign: The EU aims to revoke at least 25 passports handed out by Cyprus. The island state and EU member asks for at least a €2m investment to gain citizenship. © Reuters The EU aims to revoke at least 25 passports handed out by Cyprus. The island state and EU member asks for at least a €2m investment to gain citizenship.

Three prime ministers took to a stage in the ballroom of a five-star London hotel this week offering the world’s wealthiest people “golden passports” and citizenship of their countries in return for hundreds of thousands of pounds of investment or flat “contributions”.

Allen Chastanet, the prime minister of the Caribbean island of St Lucia, told about 300 members of the super-rich elite and their advisers gathered at the Rosewood hotel for “global citizenship conference” that his country’s economic mission was “going after high net-worth individuals and giving them a comfortable place to live”.

He promised that in return for a $100,000 (£78,000) “contribution to the national economic fund” applicants would be granted St Lucian citizenship within three months. With it comes a so-called “golden passport” giving visa-free travel to 145 countries, including the UK, the European Union’s Schengen Area, Hong Kong and Singapore.

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Also selling citizenships at the conference were the prime ministers of Albania and Montenegro, a Maltese minister, an ambassador from Antigua and Barbuda, and representatives from Cyprus.

Věra Jourová, the incoming European commission vice-president, said: “The citizenship schemes raise a number of concerns. The granting of citizenship poses a serious security risk because it gives beneficiaries all the rights of EU citizens and allows them to move freely throughout the union. The EU must not become a safe haven for criminals, corruption and dirty money.

“While we cannot ban these schemes on the EU level due to lack of competence, we want more transparency on how nationality is granted and more co-operation between member states. There should be no weak link in the EU, where people could shop around for the most lenient scheme.”

She previously described the sale of passports as “dangerous”, “problematic” and “unfair”, adding: “Having a lot of money alone shouldn’t give you a free pass to benefit from the EU citizenship… if in one country a dangerous person gets citizenship, he gets citizenship for the whole of Europe. Maybe we all have to renegotiate the whole system.”

The conference featured a keynote address by the former CIA director David Petraeus, and was compered by Nils Blythe, a former BBC business correspondent and ex-head of communications at the Bank of England.

In pictures: This week’s top photos from around the world [The Atlantic]

The three-day event, which cost £1,500 a ticket, was organised by Henley & Partners, a London-based firm that acts as matchmaker between the super-rich and countries selling their citizenships. Henley has made tens of millions of dollars in commission from selling citizenship. The trade is legal, and Henley is not accused of any sort of wrongdoing.

Cyprus, which asks for an investment of at least €2m (£1.7m), gave citizenship to Jho Low, the fugitive Malaysian businessman at the centre of the 1MDB sovereign wealth fund scandal.

The island nation, which as a member of the EU thereby gives its new citizens access to the rest of the bloc, has said it will revoke Low’s citizenship and that of 25 other suspects to whom it has sold passports. Cyprus has made about €6bn issuing about 4,000 passports since the scheme was introduced in 2013.

Malta, which is also an EU member state, has sold citizenship to five people charged with criminal offences overseas. They include Anatoly Hurgin, an Israeli citizen charged by the US and Israeli authorities with fraud, smuggling and money-laundering.

Hurgin’s cyber-intelligence firm, Ability Inc, has been accused of helping countries spy on and locate targets. Hurgin, a former major in the Israeli Defence Force, boasted to Forbes that: “With just a few million dollars and a phone number, you can snoop on any call or text that phone makes – no matter where you are or where the device is located.”

Daphne Caruana Galizia, the Maltese investigative journalist murdered in 2017, had raised concerns about Hurgin when he first received Maltese citizenship in 2016.

a blue and white boat sitting next to a body of water: Marigot Bay in Saint Lucia. Photograph: Westend61/Getty © Getty Marigot Bay in Saint Lucia. Photograph: Westend61/Getty

While St Lucia is famed for its white sand beaches and azure seas, Chastanet said there was no requirement for the country’s rich new citizens to actually live on the island, as long as they paid the money to the St Lucia development fund and bought a home in the country.

“St Lucia is modernising itself, and going to be making itself competitive on a global basis,” he said. “And it’s looking for new citizens that want to take advantage of what St Lucia has to offer.”

Chastanet, who has served as prime minister of the former British colony since 2016, claimed many of the country’s new citizens were from the US. “When they’re traveling abroad, they don’t want to have a US passport,” he said.

Chastanet was joined on the ballroom stage in the Rosewood hotel, where rooms can cost more than £2,000 a night, by Edi Rama, the prime minister of Albania and Duško Marković, the prime minister of Montenegro.

Rama launched Albania’s citizenship-by-investment programme at the conference promising a “10-year tax holiday”. He reminded delegates that Albania was an official candidate for accession to the European Union, which would give new Albanian citizens the right to live and work across the bloc.

“I know that there are controversies around this type of programme,” Rama said. “At the same time I strongly believe this is the right way, and this is what we have to do …There are, of course, risks but we cannot deny to our country and our future the enormous potential of this programme.”

Marković said he was offering 2,000 people Montenegrin citizenship in return for a €100,000 contribution to government coffers, and a property investment of at least €250,000. The Montenegro government said individuals would only be granted citizenship following very thorough security checks.

Ben Cowdock, a researcher at the anti-corruption campaign group Transparency International UK, said: “There is a growing body of evidence that corrupt elites use ‘Golden Visas’ to gain residency and citizenship across Europe. Selling a fast track to citizenship has dubious economic benefits, whilst providing an open door to those with deep pockets and a past to hide. There are serious questions whether pawning residency and citizenship should be allowed to continue.”

The governments of St Lucia and Albania did not respond to requests for comment.

Henley & Partners did not respond to requests for comment in time of publication. However, it has consistently supported its role in worldwide investment migration, which it has previously said drives industry-diversifying foreign direct investment that creates sustainable growth for countries and opportunity for their people.

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