Due diligence is at the heart of citizenship by investment

Mr. Peter S. Vincent, a former high-ranking civil servant at the United States Department of Homeland Security in an interview with Die Weltwoche talks about security, due diligence with citizenship by investment schemes. 

The citizenship by investment programs subject all applicants to multitiered due diligence at the initial stages and then, submit their applications to member state intelligence and law enforcement officials to conduct additional deep due diligence and intense vettings.

Mr. Vincent stated  The European Union is rightfully concerned about due diligence and vetting of all applicants for a citizenship in European Union member states, but it should be spending its scarce resources, time and energy on true threats.  As a counter-terrorism expert, my focus is always on the most effective and most efficient means of identifying true threats and leveraging scarce resources in a way that is targeting the greatest threats, he said.

Due diligence

Due diligence is already at the heart of the initial stage of an individual seeking citizenship by investment. That needs to be done at the initial stage by the agent or the broker of such services in order to determine whether or not those individuals are who they say they are and that their funds are completely legitimate. That due diligence and vetting needs to be conducted by a legitimate third-party due diligence providers to identify an individual in terms of establishing his or her true identity, as well as the source of provenance of all sources of income that they’re relying on. Then where there is any doubt whatsoever it must be resolved against the individual correctly or incorrectly and the agent or broker should not go forward if they cannot establish the identity and/or the source of all of their funds.

After the applicants cleared by brokers, The law enforcement and intelligence gathering services of that sovereign nation state must conduct its own robust due diligence of those applicants to include not only its own records but that of its partner countries across the globe, and also, providing that information to Interpol to ensure that the individual’s not on a wanted list, such as a red notice, as well as coordinating with the United States and its sanctions through the Office of Foreign Asset Control or the Financial Crimes Enforcement Network with the Department of Treasury to make sure that individuals are not seeking to avoid Iranian and North Korean sanctions.

Mr. Vincent warns about million people become naturalised Europeans every year – without proper checks being carried out.

Romania and Bulgaria

Mr. Vincent thinks Bulgaria and Romania are legitimate schengen beneficiaries.

Romania and Bulgaria have really robust intelligence agencies that are very skilled and experienced, given their history, but my concern is not that those agencies are in any way deficient.

My concern is that applications submitted by unscrupulous brokers don’t ever go through those agencies for vetting or due diligence, that they’re simply handed-off to a Government official authorized to grant citizenship and to issue passports with no initial third-party due diligence, let alone sovereign state intelligence and law enforcement agency checks.

I’ve seen reported that individuals are able to obtain legitimate passports in Romania or Bulgaria for as little as €5,000. Other reports suggest that individuals are able to purchase legitimate passports for €30,000.

Intelligence

The Five Eyes project with United States, Canada, New Zealand, Australia, and the United Kingdom have had historically a very robust, intelligent sharing agreement.

The European Union does a good job of sharing information amongst intelligence and law enforcement agencies.  Some countries, for historic reasons, are less willing to share intelligence with other countries, given a past history of war and conflict or a lack of trust in their fellow European member states.

Mr. Vincent stated, United Kingdom does actually leave the European Union, which is yet to be decided, then the European Union will, unfortunately, lose most, but not all, of the incredibly powerful intelligence that the United Kingdom’s MI6 and MI5 currently hold.

Mr. Vincent currently oversees the Government Advisory and Business Intelligence departments at Henley & Partners, the world’s leading agency for residence and citizenship planning.

Read the full interview here