From Transparency International

When you think of the Caribbean what is the first thing that come to mind? Pristine island shores, magnificent coral reefs, secret white-sand beaches? Well, if you are looking for a second (or third) passport then these features might not matter so much. Instead, you might be more interested in visa-free Schengen travel, lax banking regulations, or low business taxes. Not surprisingly, those are exactly the features highlighted by the leading residency and citizenship firms operating in the Caribbean.

The following is an extract from European Getaway: Inside the Murky World of Golden Visas, a joint report by Transparency International and Global Witness.

Antigua and Barbuda, Dominica, Grenada, Saint Kitts and Nevis, and Saint Lucia are the Caribbean countries that offer a fast-track route to citizenship, with a significantly low investment requirement and an extremely fast processing time.

Passports for a family of four can be acquired with an investment as low as US$100,000 within 90 days. There are no requirements to reside in these countries, with the exception of Antigua and Barbuda, which has a five-day residence requirement. In fact, applicants do not even need to pick up their passports in person.

Saint Kitts and Nevis’s scheme claims the title of the world’s first citizenship-by-investment programme. Since its establishment in 1984, it has undergone several changes. Henley & Partners became responsible for the re-design and international promotion of the programme in 2006. The success of the programme, however, only came around 2009, after the country was granted a visa-waiver status by the EU. In fact, according to Henley & Partners, the firm was “instrumental in the negotiations with the European Union that led to visa-free access for all Saint Kitts and Nevis citizens”.

The other countries running citizenship-by-investment programmes also recently signed visa-waiver agreements with the EU (Antigua and Barbuda in 2009; Dominica, Grenada and Saint Lucia in 2015), coinciding with the time of establishment or re-design of their programmes. This means that successful applicants of these programmes can enter the EU Schengen Area and the UK without having to apply for a visa or undergo any enhanced checks by authorities in EU Member States.

Recent events raise red flags regarding the due diligence process in some of these countries. In March 2018, Saint Lucia cancelled the citizenship of six recently successful applicants, alleging that they had committed acts that had the potential to harm the country’s reputation. In June 2017, Canada cancelled visa-free travel for citizens of Antigua and Barbuda over fears that its lack of residency requirement for applicants posed a risk. Canada had made a similar move against Saint Kitts and Nevis back in 2014 due to security concerns. A year earlier, the US Department of the Treasury Financial Crime Enforcement Network (FinCEN) issued an advisory stating that the Saint Kitts and Nevis citizenship-by-investment programme was being used to facilitate financial crime. According to FinCEN, the program is attractive to illicit actors for its lax controls regarding who may be granted citizenship. FinCEN has yet to lift its advisory.

The opacity of these programmes compounds the risks. Caribbean countries publish limited information about due diligence checks carried out during the application process. There is also limited information regarding the number of applications received and rejected. None of the countries publish the names of individuals granted citizenship, thus preventing public scrutiny. As the programmes become a fundamental part of the economy in these countries (in some cases, income from the programmes has contributed up to 25 per cent of the GDP), there may be a greater desire to attract more applicants and consequently more funds, increasing competition in such a way that it produces a race to the bottom. Weak due diligence processes and lax control can result in security and reputational risks not only to the countries running these programmes, but also to all countries and regions with which they have visa-free agreements, including the European Union.

In light of the risks of admitting the corrupt and the criminal, the European Union must review its visa free agreements with these Caribbean jurisdictions and encourage governments to set high due diligence and integrity standards. Ultimately, if the EU is not confident in the ability of these schemes to identify and reject high-risk applicants, it should consider following Canada’s lead by suspending the visa waiver to golden visa schemes outside the EU.

Caribbean golden visa schemes: facts & figures

ANTIGUA AND BARBUDA

Minimum investment: US$100,000 for a family of up to four people

Timeframe: 90 to 120 days

Visa-free Travel: 149 countries

Key countries: EU Schengen area, UK, Hong Kong, Singapore,

Residence requirement: Minimum period of 5 days during the first five years when the investment must be maintained.

DOMINICA

Minimum investment: US$200,000 for a family of four people

Timeframe: 90 days

Visa-free Travel: 120 countries

Key countries: EU Schengen Area, UK, Hong Kong, Singapore

Residence requirement: None

GRENADA

Minimum investment: US$150,000

Timeframe: 90 days

Visa-free Travel: 141 countries

Key countries: EU Schengen area, UK, China; E-2 Investor Visa treaty with the US, allowing Grenadian nationals the opportunity to enter and work in the US.

Residence requirement: None

ST. KITTS AND NEVIS

Minimum investment: US$150,000 single applicant + US$25,000 for a spouse and US$10,000 for each additional dependent

Timeframe: 60 days accelerated process available

Visa-free Travel: 151 countries

Key countries: EU Schengen Area, UK (6 months), Hong Kong, Singapore,

Residence requirement: None

ST. LUCIA

Minimum investment: US$190,000 for a family of four people

Timeframe: 90 days

Visa-free Travel: 142 countries

Key countries: Schengen area, UK, Hong Kong, Singapore

Residence requirement: None

IMAGES:

© Annie Spratt / Unsplash

© Tom Grimbert / Unsplash

For more on this story go to: https://voices.transparency.org/caribbean-golden-visas-rum-deal-for-europe-645662e5e534