The vetting processes behind citizenship by investment schemes in the Caribbean have been lauded by industry experts as some of finest in the world.
And the older programmes – in particular those of St Kitts and Nevis and Dominica – have been praised for confronting hurdles and showing “sophistication”.
Members of the industry, including international marketing agents and the heads of national citizenship by investment (CBI) programmes, have been speaking as Antigua and Barbuda deals with the fallout surrounding a man granted citizenship earlier this year.
Alexandre Cazes, believed to be behind dark net marketplace AlphaBay, was found dead in a Bangkok jail cell on 12 July. The website allegedly sold illegal goods, class A drugs, pornography, stolen credit cards and weapons.
Nuri Katz, president of Apex Capital, believes that negative stories fail to understand the work that goes on behind the scenes to ensure applicants are thoroughly researched.
“The due diligence process in all the Caribbean countries is, despite internal wrangling, the best due diligence process known to man,” he said.
“Certainly if you look at the due diligence process in the investor immigration programmes in Canada, UK, US, and the European countries, there is no question that the Caribbean process is much better. This is simply an objective fact.” In the case of Cazes, who also passed citizenship procedures in Cyprus, the blame lies with the USA, Katz adds.
“The American government, who had Cazes under investigation, seems to have cleared him. Clearly this is a case where the American government was not working well, [and] did not inform other intelligence agencies.”In the case of Cazes, who also passed citizenship procedures in Cyprus, the blame lies with the USA, Katz adds.
Rapid growth means greater scrutiny
St Kitts and Nevis has the oldest programme, having started in 1984, with Dominica slightly younger (1993). Austria, which launched it’s scheme in 1985, is Europe’s oldest.
Since 2013, three Caribbean nations have rolled out their own CBI programmes: Grenada, Antigua and Barbuda, and St Lucia.
This has been part of a growing trend across the world, with Bulgaria, Comoros, Vanuatu, Malta and Cambodia joining the scene in the last decade.
But with greater numbers applying, the due diligence procedures have had to be tightened, and it has been the Caribbean leading the way in this aspect.
In June, Professional Wealth Management – a publication from the London-based Financial Times – ran a special report covering the CBI Index that put the oldest programmes in the area at the top, beating West Indies’ newcomers.
The vetting procedures were singled out as exceptional “owing to their unique data collection and due diligence features”.
“With age comes wisdom, and as the longest-running programmes occupying the economic citizenship industry today, the citizenship by investment programmes of St Kitts and Nevis and Dominica have the benefit of maturity,” said Micha Emmett, CEO of CS Global.
“As the programmes have grown with time, so has the sophistication of their vetting processes.
“Other programmes are still in their infancy with respect to due diligence procedure. By contrast, St Kitts and Nevis, as well as Dominica, are not only vetting their applicants by sourcing information from a wealth of channels, but they are using this information to ask the right follow-up questions.
“Their experience and maturity in the market allow both countries to make pragmatic, shrewd decisions about who is granted citizenship.”
WIC News also approached two other residence and citizenship planning companies. Arton Capital declined to comment, while Henley and Partners are yet to make a statement at the time of publication.
Two months ago the prime minster of St Kitts and Nevis, Timothy Harris, stated that the twin-island nation’s CBI programme was the “Rolls-Royce of the global industry”.
And while the system hasn’t been without problems – something that Les Khan, chief executive officer of the federation’s Citizenship by Investment Unit, admits – the issue of due diligence is an ongoing process that is paramount to a well-run service.
“We have taken additional steps in what we do to ensure we could establish, or reestablish, credibility. We made sure that our due diligence companies are credible, we use more than one company, and we chose the best company for the best country that we were doing due diligence on.“You can say that perhaps in the past things weren’t as robust. But now we have the strongest due diligence in the CBI world, and our process has been recognised as such,” Khan told WIC News.
“We assess the companies on a nearly daily basis when we see their reports. If we consider any reports lacking, we will switch from them almost immediately.”
Countries new to the CBI scene must realise that putting in place watertight world-class procedures isn’t an overnight move, Khan said, especially as due diligence must be something that is ongoing even after citizenship is granted.
“Once our providers are given a name, they will continuously run that name through international databases,” he added.
“If someone gets to added to something like an Interpol list, this will be flagged and we will be told immediately.”
Referring to Cazes in Antigua and Barbuda, Khan said: “These are all clean people at the time.”
Seeking ‘good moral character’
Dominica, an island prized for it’s beauty, is often the focus of the ugliest allegations and criticisms – especially those online who favour ‘trolling’ to action.
But in spite of petty distractions, the CBI programme stands as one of the best in the world, ranked first in the CBI Index.
Not only does Dominica not pay commission to agents, the country echoes the “robust”, “strict” and “in-depth” vetting that St Kitts and Nevis follows, all of which are the foundation of a successful programme says the coordinator.
“To maintain a strong vetting system, it is critical that we do not rely blindly on what a due diligence report discloses, but that we at the Unit judiciously assess and vet the applicants thoroughly to ensure that they are legitimate applicants,” Emmanuel Nanthan said, who has been in charge since January 2015.
“Due diligence cannot happen in a vacuum therefore the committee, my team and I will go back to the file to evaluate an applicant until we are satisfied that the individual is someone we deem worthy of becoming a citizen of our country.
“For the continued success of our programme, we are regularly reassessing, consolidating and improving our due diligence and vetting practices.”
Dominica works with “top UK and US due diligence firms, relying on their years of experience in the field and their relationships with international agencies” to ensure quality, Nanthan added.
And he has a message for those thinking of applying.
In particular, during the last two years, we have intensified our due diligence procedures. We want to attract only applicants of high repute and good moral character.
“Applicants with untoward financial, security or ethical backgrounds are not welcome in Dominica.”