Author: Niu Ltd

To access the data sheet on the Portugal’s Golden Residence Programme (GRP) results as of the 31^st December 2016, please click here

With only six months on the job, the Chief Executive Officer (CEO)
of the Citizenship by Investment Unit (CIU) Chisanga Chekwe has tendered his resignation to Prime Minister Gaston Browne.

However, the reasons for the CEO’s resignation remain unclear. When the prime minister was contacted yesterday he declined to give the reasons for the CEO’s abrupt departure.

PM Browne said, “You’ll have to ask him about it. Call him and inquire of him.”

While OBSERVER media was not able to reach Chekwe, it was reported that he gave the PM his letter of resignation in the latter part of December, and that discussions were held with Browne prior to his taking vacation.

It is not known whether further discussion relating to the CEO’s tenure were held at any point after he returned from vacation some time within the last two weeks. But OBSERVER media understands he may leave around the middle of 2017.

It was also reported that the prime minister did not at first accept the CEO’s resignation when it was tendered weeks ago. However it remains unclear whether Chekwe’s mid-year exit is a plan agreed between the two or one of his own making.

Even if the government of Antigua & Barbuda does not accept the resignation the CEO would not be under any obligation to remain with the CIU.

News of his resignation comes at a time when the Citizenship by Investment Programme (CIP) is under scrutiny.

Source: https://antiguaobserver.com/

Les Khan, CEO of the Citizenship by Investment Unit (CIU), announced today that the Cabinet has approved changes to the Citizenship by Investment programme.

The changes are being implemented to better integrate applicants into the life of the Federation by supporting applications from families. To this end, the announced changes include the lowering of the dependent ages for parents from 65 to 55, the increasing of the age of a financial dependent from 25 to 30 and the confirmation that children under the age of 16, born after the main applicant received citizenship, will no longer be required to be processed by the CIU. These dependents can be added through an application to the Ministry of National Security.

In addition, the Sugar Industry Diversification Foundation (SIDF) contribution requirements have been modified. The minimum contributions to the SIDF to qualified persons will now be:

• Single Applicant: US$250,000.00
• Applicant with up to three dependents: US$300,000.00;
• Additional contribution for each additional dependent, regardless of age: US$25,000.00;

Mr, Khan said:

“We know that many of our applicants want to bring parents in order to offer them a better quality of life in their advancing years and in a country that is both beautiful and with a favourable climate. We recognise that citizenship is more than a passport. It’s a lifestyle choice for the whole family and we want to ensure that applicants with larger families are catered for.”

Prime Minister Harris also commented saying:

“My government continues to review policies and procedures to ensure that the Platinum brand of the programme is maintained whilst also being flexible in meeting the needs of applicants. The changes announced today are the first of many expected during the course of 2017.

This will include further enhancements to the due diligence process for Authorized Agents to ensure that they follow all of the required procedures with regards to Anti-Money Laundering and Know Your Client practices.”

Source: thestkittsnevisobserver.com

Caribbean citizenship by investment (CBI) programmes are among the best in the world. With the option of investing in real estate or contributing directly to national foundations and trusts, qualified applicants can be granted citizenship in as little as 90 days. Owing to its simplicity, low cost, vast global mobility and quality of life, Grenada’s CBI programme was last year ranked first globally.

CBI programmes benefit the Caribbean economy

A recent Fortune article claimed individuals spent nearly $2 billion in 2014 on CBI programs, contributing millions of dollars to the Caribbean economy.

A significant percentage of the millions generated by such programmes are used to fund various development initiatives across a range of sectors through such enterprises as the St Kitts & Nevis Sugar Industry Diversification Foundation, designed to help the government transition from sugar as the main industry to a more diversified economy.

To apply for CBI in Grenada, for example, investors must contribute a minimum of $200,000 to its National Transformation Fund. The NTF finances various projects in Grenada for the benefit of its many industries, including tourism, agriculture and alternative energy.

Economic lifelines

As discussed by leading global real estate experts Kingsland Global, a common reason countries have increasingly introduced CBI programmes is because of an economic slowdown and “the virtual disappearance of traditional funding sources.”

Meanwhile, Dr Anthony, former Prime Minister of St Lucia, cited “the persistent decline in foreign direct investment caused by the world financial crisis” as the grounds for his government deciding to initiate a CBI programme.

The programmes generate investments and jobs to and put countries the road to sustainable growth and development. Such programmes have become an economic lifeline in these nations, raising substantial revenue for the governments concerned.

For St Kitts & Nevis, the program generated nearly a third of the government’s revenue in 2015—approximately $74 million—and became so successful that St. Kitts emerged from the global financial crisis far ahead of its neighbours in the Caribbean. “It’s been a complete transformation,” says Judith Gold, head of an International Monetary Fund mission to the country. That’s no exaggeration—in 2006 the government had been the third most indebted on earth.

In Dominica, $279.8m in revenue was realised in the financial year 2015/2016. Funds have allowed for post-tropical storm Erika rehabilitation works, including the rehabilitation of Douglas Charles airport.

The benefits of CBI haven’t gone unnoticed: In 2014 alone, new citizenship and residence programmes were introduced in Portugal, Cyprus and Greece that either allow direct citizenship by investment or offer alternative routes to citizenship for wealthy investors in the EU.

Long term gains

Since 2006, programmes have matured owing to international agents ensuring probity and insurance of commercial sustainability. Today, Citizenship by Investment programmes facilitate long-term investment and residency to bring long term gains for local economies.

According to CS Global Partners, it’s a means of transforming economies to become ever more prosperous and independent. “The NTF finances various projects in Grenada for the benefit of its many industries, including tourism, agriculture, and alternative energy. Having made a donation to the NTF, investors are left with a true sense of having contributed to their new nation’s well being.”

More than that, CBI-funded initiatives are in the rare position of being able to operate as debt free businesses going forward. This is a major economic sustainability factor.

On January 1, 60 Minutes — an investigative programme aired by the US television company, CBS Corporation — ran a segment on ‘Citizenship by Investment Programmes’ (CIP) that are operated by several countries around the world. For reasons best known to itself, 60 Minutes focused on three Caribbean islands after paying merely a passing glance at Malta, a Mediterranean island that is part of the 28-nation European Union (EU). It let pass other countries in Europe and North America that also operate such programmes.

I believe the broadcast had no other purpose except to denigrate — if not to emasculate — the CIPs and the governments that operate them. It categorically stated that CIPs “attracted among the buyers a rogue’s gallery of scoundrels, fugitives, tax cheats, and possibly much worse”. It neglected to mention that the vast majority of CIP recipients were wealthy law-abiding persons who had been subjected to intense scrutiny by enforcement agencies before their applications were even considered.

The segment of the programme was headlined, ‘Passports for sale’. The headline contrasted sharply with the title I had given to an article on the same subject just one year before. The article I wrote was called, ‘Passports to save the economy’.

The difference in the treatment of the same subject was that, as a worker in the cause of the development of small countries, I understand the imperatives that compel governments, in adverse conditions, to seek new and creative ways to keep their economies alive and to continue to provide for their people. In the case of 60 Minutes, the reporters were not concerned about the underdevelopment and neglect that caused governments to market the most precious of all precious national assets — citizenship.

The programme 60 Minutes portrayed the CIPs in the Caribbean as a “security threat” to the US. Significantly, the programme hung that claim on an interview with only one person, albeit a former legal adviser to the US Immigration and Customs Enforcement arm of the Department of Homeland security, Peter Vincent. It passed over a comment from General John Kelly, the former head of the US Southern Command, who is slated to be the Secretary for Homeland Security in Donald Trump’s Cabinet. Kelly was quoted from a report he issued last year in which he said, “Cash for passport programmes could be exploited by criminals, terrorists or other nefarious actors.” There is a big difference between “could be exploited” and “is being exploited”.

In the interest of providing a semblance of balance, 60 Minutes did allow Antigua and Barbuda’s Prime Minister Gaston Browne to make the point that, in the case of his country, the names of all applicants for citizenship are screened by American intelligence and law enforcement agencies. And while it did not question his assertion, or try to present any evidence to disprove it, the programme went on to state that the issuance of diplomatic passports to CIP recipients is “a gaping hole in a very effective global security architecture to prevent terrorist attacks”. The broadcast supported this assertion only by Vincent’s remarks that, “The border officials at the receiving country, even without a visa, almost always admit an individual carrying a diplomatic passport. In addition, border forces are not entitled to search the luggage of diplomats like they are for regular tourists. They simply wave them through.”

The latter statement in the context of the US is not accurate. From personal experience as an accredited ambassador to the United States, I know that holders of diplomatic passports are questioned by immigration and Customs officials, and that searches of their luggage are not prohibited unless State Department officials accompany them — a privilege accorded only to heads of Government on official business in the US or to accredited ambassadors on their first arrival in the country.

That being said, 60 Minutes did admit that the provision of diplomatic passports is not part of the CIPs. It claimed that where this has been done — and it identified specific cases in Dominica and St Kitts-Nevis — “it goes on under the table”.

The Prime Minister of Dominica Roosevelt Skerrit has since “categorically” refuted this charge. For my part, I believe diplomatic passports are important to facilitate business between governments; they ought not to be in the hands of anyone except diplomats accredited to specific countries or international agencies, and heads of government and ministers conducting official business. Unfortunately, their overuse – and probably their abuse — by a few governments has already undervalued their utility.

Where 60 Minutes let down its global audience and damaged the Caribbean is in its failure to explain why governments have turned to CIPs as a tool for economic development and social improvement. The description of these countries as “cash-starved” labels the condition without defining the cause. Why are they cash-starved? And why do they have to adopt policies to offer their cherished citizenship in return for investment?

As I pointed out in my December 2015 article, “…All of the Caribbean countries involved with citizenship by investment programmes have come to them by necessity. Poor terms of trade, vulnerability to financial downturns in North America and Europe from where most of their tourists come, declining aid, persistent natural disasters, and no access to concessional financing from international financial institutions have forced them to be creative in raising revenues. They are all faced with fiscal deficits, high debt, and an international environment that is unresponsive to their predicament.”

If the international community provided transformative means to address the development needs of these countries and their increasing vulnerability to external shocks, such as unrelenting and persistent hurricanes and events like the 2008 global financial crisis which began in the US, they would not have to resort to offering citizenship in return for investment.

The coverage by 60 Minutes was less than fair in failing to point out that many of the governments of these countries are running a rigorous programme of scrutiny of CIP recipients precisely because they are conscious of their responsibility to other countries.

In the case of Antigua and Barbuda, Prime Minister Browne made it clear that his Government is interested only in high-worth individuals – the crème de la crème, as he put it — who can pass the most stringent security checks.

Also, 60 Minutes was less than fair in not mentioning that many other countries operate programmes under which citizenship is offered in return for investment — among them the US (SA EB-5 Visa Program).

There is nothing intrinsically wrong with citizenship by investment programmes, or with their merit as a development tool; it is the rigour of their implementation that is important. And it is such rigour upon which all countries should insist.

If the stricture becomes that developing countries should not operate CIPs, an international double standard is created by which small and weak countries are again disadvantaged by the powerful.

Source: jamaicaobserver.com

An Everett developer’s guilty plea Wednesday to federal fraud charges is the latest example of abuse of the EB-5 program offering green cards to foreign investors.

Lobsang Dargey used the program to fuel his fast rise in the Puget Sound real estate industry. Now, he faces up to 10 years in federal prison and must repay investors $24 million.

Before his legal troubles began, the 43-year-old claimed to be a rags-to-riches story come true. He says he grew up dirt poor in rural Tibet, and came to the United States in 1997 with hardly a dollar to his name.

After nearly 20 years in the country, he still struggles with English, reading at a grade-school level. Yet he understands how to sell investors and public officials on development projects, including a proposed 41-story tower in Seattle. And he speaks fluent Chinese. China is home to many newly-minted millionaires who want to move to the U.S.

Dargey raised more than $150 million from Chinese nationals intent on moving to America, purportedly for his Seattle tower and a mixed-use apartment building in Everett. Yet, he now admits to using millions of dollars for other construction projects, personal shopping sprees, a luxury home and trips to casinos.

His fraud is hardly the first time criminals have used the EB-5 program, which is run by U.S. Citizenship and Immigration Services (USCIS), as cover. The program’s popularity has soared since the Great Recession — and so have the ranks of critics and opponents calling for extensive reforms, if not ending it outright.

The program’s defenders say it has brought billions of dollars into the country and created thousands of jobs.

The two sides appeared headed for a showdown in Congress as the EB-5 program was set to expire in late September. In the end, legislators punted, renewing the program until April and leaving it for the new Congress to resolve. The program’s name stands for Employment-Based Immigration: Fifth Preference.

Sen. Chuck Grassley, R-Iowa, one of its leading critics, called the short-term extension “another missed opportunity” to clean up the program.

“It poses significant national security risks,” he said in December. “There are serious allegations that the program may be facilitating terrorist travel, economic espionage, money laundering and investment fraud.”

He and Sen. Patrick Leahy, D-Vermont, have led the charge for reforms.

In recent years, the U.S. Securities and Exchange Commission has filed more than a dozen lawsuits alleging fraud in EB-5 projects. That includes a lawsuit against Ariel Quiros, of Miami, and William Stenger, of Newport, Vermont, who allegedly skimmed $50 million off of $350 million that investors put into developments in Vermont.

State and federal prosecutors have filed criminal charges in a handful of cases involving EB-5 monies. Federal oversight reports in the past two years have highlighted a laundry list of shortcomings and problems.

Yet supporters, including Sen. Chuck Schumer, D-N.Y., remain adamant that it fuels economic growth in the U.S. Developers and other proponents spent up to $3 million to block a reform bill by Grassley and Leahy, reported The New York Times.

Nearly all immigrants in the EB-5 program invest in a regional center, a private company approved by the USCIS, which is part of the Department of Homeland Security. The number of regional centers has shot from 11 in 2007 to 865 as of early December, including 56 in Washington.

Individuals are supposed to invest at least $1 million in a development that creates or preserves at least 10 jobs in the U.S. However, investors only have to put in $500,000 if the development is in a low-employment area.

But the rules governing how low-employment areas are drawn up are so lax that developers can combine an upscale neighborhood with poor areas that are, in at least one case, miles away and across a river. That happened with the Battery Maritime Building in Manhattan. The investment area avoided rich neighborhoods nearby but included low-income areas across the East River in Brooklyn.

It is “gerrymandering,” Grassley said in 2015

Immigrants who put money into a regional center are passive investors. They have no active role in the development.

Dargey followed the typical process. First, he set up a regional center — Path America SnoCo — associated with his proposed Potala Place, a mixed-use apartment building in Everett. Then he sought investors. He went to China, the source of the vast majority of EB-5 investors, to get backers.

Investors cut him a check, which went into escrow. Then they applied for a two-year temporary visa to live in the U.S. Once approved, the money was released from escrow to Dargey, who was supposed to use all of it for the development.

At the end of the two-year period, investors apply to the USCIS for permanent residency. Their petitions are supposed to be approved based on whether the project actually created jobs.

Yet, Dargey’s own actions, documented in his plea agreement with federal prosecutors, underscore some of the procedure’s shortcomings. After misusing investors’ money and substantially changing the approved business plan, he falsified documents to hide those actions from the federal government.

While he lied to investors, lenders and authorities, spent money on himself and other projects, and then covered it up by borrowing more money, he did leave behind a building — Potala Place — in Everett. Its ground floor retail space is still unfinished.

His participation in the program ended in August 2015, when the SEC filed a lawsuit accusing him of fraud. A criminal investigation commenced at the same time, culminating in Wednesday’s guilty plea to two charges — one of wire fraud and one of concealing information from federal authorities.

It is not clear if his investors will be able to stay or have to return to China, though. Immigration officials ended his companies’ involvement in the EB-5 program, saying that Dargey’s criminal activity negated the projects’ job-creating benefits. That decision is being appealed.

The EB-5 program’s head, Nick Colucci, acknowledged some of its shortcomings while speaking at a conference in Miami last July.

“As in any other financial sector, self-policing is vital to the integrity of the program,” he said.

Nonetheless, his office will work with law enforcement and the SEC to root out bad actors, he said.

Responding to critics, USCIS has overhauled its oversight of the EB-5 program in recent years. Colucci’s staff has grown nearly tenfold since then, but as of last year, it still only had two auditors to comb through developments’ books.

Fraud and other crime must be stamped out of the EB-5 program, he said at the Miami conference. They harm “not only investors and communities but also, I would add, could jeopardize the very existence of the program.”

Source: heraldnet.com

Residency-by-investment programs are an attractive option for some HNW individuals, but may be designed to the detriment of the country in which the program is available.

According to our 2016 Global Wealth Managers Survey, 18.7% of total HNW wealth is held offshore. HNW individuals may invest in markets outside their country of origin for several reasons, such as geographic diversification and access to a better range of investments.

Offshore investments can also be driven by wealthy investors seeking to live outside their country of origin. Whether to gain access to a larger trading bloc (such as the EU) or provide their family with a better quality of life, obtaining residency of more than country can be beneficial to HNW individuals. Many countries offer programs which grant residency to individuals who invest a specified amount into the country. This investment can take many forms, which in many cases contributes to the country’s economy, property market, or even culture. For example, Portugal’s residency-by-investment program allocates a portion of the funds to scientific and technological research, as well as refurbishment projects for national heritage buildings. These residency-by-investment programs can be rewarding for individuals who participate because of the ability to help improve the country, whether through job creation or quality of life.

Unfortunately, this is not the case for all investment programs. In 2011 Hungary introduced a residency bond program whereby wealthy foreigners can obtain a permanent residency permit from the Hungarian government in exchange for an investment of €300,000 into the country’s debt securities. Boldizsár Nagy, an associate law professor at Central European University, has authored a report that argues that the program had minimal impact on Hungary. In conjunction with the Investment Migration Council and Transparency International, This, in turn, did little to help the country as a whole and contributed less than 0.5% to financing state debt.

While the Hungarian residency bond program was not created to improve any aspect of the country’s economic or financial condition, there is a responsibility on behalf of governments to seek solutions for bettering the lives of residents. Residency-by-investment programs should be designed so that they are of benefit to the investors and the country for which the program is offered.

At the same time, many HNW individuals care about how the money they’ve invested is used beyond the process of granting residency. With a number of residency programs available, investors are likely to favor those that can have a meaningful and positive impact on the country in which the residency is offered. Wealth managers should recognize this need and make sure they fully inform their clients about their options and the consequences of their choices.

Source: verdictfinancial.com