Governments to review money for citizenship scheme amid controversy
Bert Wilkinson | 8/9/2018, 12:51 p.m.
Governments in the smaller Eastern Caribbean subgrouping are to discuss major security lapses in a scheme through which several island nations sell national passports and citizenship to foreigners willing to pay specified amounts of cash or invest in property and other development projects.
St. Kitts, Antigua, Dominica, St. Lucia and Grenada all participate in the system that they claim brings hundreds of millions of dollars to their economies to make up for failed sectors such as banana exports, a declining offshore financial sector and fluctuating tourism numbers.
They also claim that the sale of passports and national citizenship helps to make up for millions in import taxes lost through the regional single market free trade system that permits goods manufactured in the bloc of 15 nations to move around with little or no import duties.
The result is that economies are now heavily dependent on the so-called Citizenship by Investment Program, to such an extent that some countries have reduced the required fees to quality for a passport and citizenship to as low as $100,000, cutting the amount by more than 70 percent in some cases as they race and compete against each other for would-be investors and new “citizens.”
Keith Mitchell, prime minister of Grenada, the current chairman of the Eastern Caribbean Central Bank and Monetary Council, says that a formal inquiry ought to be launched to determine whether CIP active countries have been properly scrutinizing foreign applicants before permitting them to have local passport and citizenship papers.
His remarks come amid a swirling controversy in nearby Antigua, where authorities are investigating the circumstances surrounding the issuance of a passport to Indian national and billionaire Mehul Choksi. Choksi is wanted by Indian law enforcement authorities for alleged bank fraud and other crimes but was still able to pass muster and scrutiny in Antigua to meet the requirements of the CIP.
Local media blamed lax research into his background as Interpol, the international police system, has a red notice for him that could have easily be accessed by Antiguan officials, if only they had bothered to check. Antigua has had several such issues over the years.
Mitchell says such lapses must cease.
“There are reports circulating of some citizenship by investment applicants receiving passports without the regional body getting the data about the applicant and not conducting the relevant due diligence,” Mitchell told Grenadian media. “Despite the fact that some are saying this doesn’t happen in their jurisdiction, the fact is that rumors are out there. I told my colleagues that we have to deal with this. If it’s not true, then we have to confront it. We cannot just say it’s not true because the rumors are circulating, so they have mandated me to get the facts and to examine the issue.”
He contended that checks must be made with the CARICOM Implementation Agency for Crime and Security and the Joint Regional Communication Center because these organizations have the tools to assist governments in processing applications from foreigners.
Defending the actions of the local CIP agency, Antiguan officials say that Choksi produced a character certificate from India showing nothing untoward in his background. Checks were also made with Interpol and again nothing negative showed up.
“In no instance was any derogatory information disclosed on the applicant,” the island’s government said in a statement, noting that there was nothing in the search trail to “render him ineligible for grant of travel facilities, including visa for Antigua and Barbuda.”
Still Mitchell says the situation has to improve. Canada recently mandated that Antiguans must obtain travel visas to enter that country as it moved to block controversial CIP recipients from benefiting from visa-free travel to Canada.