BASSETERRE, St Kitts — At a press conference last week, leader of the opposition, Dr Denzil Douglas, said that, during a recent visit to the Middle East, he discovered that citizenship agents were advertising that St Kitts and Nevis economic citizenship can now be obtained for as little as US$37,500.
This was being accomplished, Douglas asserted, through “some creative ways that they have invented, with the support of this government, to further cheapen our citizenship in the market place”.
According to separate reports from Dubai, prospective real estate developers have done a deal with the St Kitts and Nevis government at the highest levels to sell passports using the real estate option for US$50,000 instead of the published US$200,000, without being required to build anything.
If true, this would not be the first time that “creative ways” have been used to circumvent the legal requirements for regional citizenship by investment (CBI) programmes.
Earlier this year, it was discovered that a resort developer in Dominica was offering economic citizenship applicants a “special price of $165,750” notwithstanding that the cost of each “share” in the resort was $220,000 as required by law.
The balance was to be financed by “a third party” but in “return for such financing the applicant will be required to transfer to the third party all of his shares in [the development], the return on those shares and the right to reside in the resort consequent upon the ownership of those shares.”
In other words, it appeared that, under this unusual and arguably illegal provision, the applicant received nothing of value in return for his payment except for Dominican citizenship, as would be the case if the applicant had instead made the optional contribution to the island’s Economic Diversification Fund. However, in this case, the developers pocket the money instead of the government, without giving anything of value in return.
The current published requirements for acquiring citizenship by investment in St Kitts and Nevis, according to the government’s Citizenship by Investment Unit (CIU), are a contribution to the Sustainable Growth Fund (SGF) of US$150,000 for a single applicant or US$195,000 for the main applicant with up to three dependents.
Alternatively, applicants may qualify for citizenship through an investment in a pre-approved real estate project, which may include hotel shares, villas, and condominium units. The minimum real estate investment required by law is US$200,000 (resalable after seven years) or US$400,000 (resalable after five years) for each main applicant.
Douglas accused Prime Minister Dr Timothy Harris of making the CBI programme less transparent and less accountable than it has ever been in the past.
“Over the past year, Dr Harris has suspended the Sugar Industry Diversification Foundation (SIDF) and created a slush fund, that is the Hurricane Relief Fund, which has now been replaced by the Sustainable Growth Fund or the SGF,” he said.
“Dr Harris has cheapened the CBI programme and, in so doing, has exposed it to further risk of attracting criminal elements into this programme. Under the new SGF, St Kitts and Nevis passports are now being sold like food in a marketplace, at US$150,000 for a family, or US$50,000 per person for a family of four persons. This, I wish to remind you is down from the US$250,000 per person under the Labour administration. If, at US$250,000, we were being criticized that this would attract criminal elements, how much more at risk are we, with the people paying only US$50,000 for our passport?” Douglas continued.
He pointed out that the SIDF was governed by the relevant Act, with its legal responsibilities and parameters governed by the laws of St Kitts and Nevis but that the new SGF has no basis whatsoever in law.
“For the last three-and-a-half years, the SIDF fund and the CBI program have been run completely out of the office of the prime minister, with his friends and family members doing as they feel,” Douglas claimed.
He also noted that the government has failed to implement recommendations made by due diligence firm, IPSA International, including establishing an independent commission for oversight of the CBI programme.
“This is highly critical; this would create an arm’s length buffer between the office of the Prime Minister, and the CIU, by adding a new layer of oversight for review and the final approval of CBI applications, without interference from the prime minister.
“This report contained 19 other recommendations. In fact, I hold in my hand, a copy of the IPSA International report, with the recommendations, that were left in the office of the prime minister, when I left office in February of 2015. Twenty recommendations were made, only one it would appear that has been made. What has happened to the others?” Douglas asked.