Caribbean “golden passports” are getting more expensive, a response to pressure from the US and the European Union to crack down on citizenship sales, Report informs via Bloomberg.
A group of four Caribbean nations has agreed to charge at least $200,000 for their passports starting June 30, double the current rate in some cases. The countries will also close loopholes that allowed passports to be sold at a discount.
Citizenship-by-investment, or CBI, programs rake in more than $579 million a year in the Caribbean and make up more than half the national revenue of some of the region’s tiny island nations. But the programs are under scrutiny by European and US regulators, who are increasingly concerned that they are being used to circumvent immigration controls and can serve as a gateway for criminals.
“Golden passports” give visa-free access to the EU, the UK and other countries, making them popular with nationalities that would usually be required to apply for travel permits. The five Caribbean nations with CBI programs have extended citizenship to at least 88,000 people, including many Chinese, Russians and Nigerians, according to a EU report last year.
The Organisation for Economic Co-operation and Development said the programs may help criminals “perpetrate massive frauds and launder proceeds of crime and corruption reaching into the billions of dollars.”
Demand for the Caribbean passports is soaring, said Kara Doherty, managing director at Antigua-based Apex Capital Partners, a firm that advises on second citizenship. Interest has increased almost 300% during the first two months of the year, she said, pinning it on the rise of Bitcoin and other tokens. US citizens, who see a second passport as a hedge against geopolitical turmoil, are propping up sales too.
The Caribbean countries also agreed to share information, submit to independent financial audits and enhance transparency. The changes are intended to address “concerns which the EU, in particular, would have had with these programs,” Dominica Prime Minister Roosevelt Skerrit said in a statement.
A holdout nation might undermine the effort.
Saint Lucia, where passports sell for $100,000, didn’t sign the agreement, which only encompasses Dominica, Grenada, St. Kitts and Nevis and Antigua and Barbuda. St. Kitts has the Caribbean’s oldest and expensive CBI program at $250,000.
Saint Lucia officials didn’t respond to requests for comment.
The new agreement also tries to stop sales of passports at a discount. In some cases, local property developers were allowed to hand out passports to buyers at a fraction of the original price, with promises of future payments. But when projects stalled, buyers would be able to walk away with citizenship at below market rates.
St. Kitts Prime Minister Andrew Drew said the sale of discounted passports is “a scourge on the CBI industry” for sapping government revenues and leading to unfinished projects.