By Uglobal Staff
Malta’s RCBI program has come under renewed scrutiny after leaked documents claim that the country has given out passports and citizenship to some wealthy foreign individuals despite them not meeting the minimum residency requirements, according to a new report by the Investigative Journalism for Europe.
The documents, dubbed the Passport Papers, were published on April 22 after a joint investigation was carried out by five Maltese media outlets, the Daphne Caruna Galizia Foundation, the Guardian and the Dossier Centre; supported by the Investigative Journalism for Europe.
What did the Passport Papers say about the Malta CBI program?
The investigation found out that on average a wealthy foreign individual named in the leaked documents had spent just 16 days in the country before they managed to get the coveted EU-recognized passport of Malta. According to the media reports, some legal loopholes had been utilized to demonstrate the individual’s supposed genuine links to the country, such as year-long rental agreements for properties, donation to charities, and local club memberships.
According to Maltese law, a CBI applicant must hold residency for at least 12 months before becoming eligible for citizenship and passport. The 12-month condition was created in 2014 as a move to placate the concerns from EU over Malta’s RCBI program.
Who were the investors who gained citizenship in Malta?
The highest number of successful applicants came from Russia (39%), Saudi Arabia (10%), China (9%), South Africa (6%), U.S.(4%), while other countries accounted for 32%. Some of the people named in the Passport Papers came from prominent billionaire families based in Saudi Arabia, Qatar, Nigeria, Russia, Malaysia, Venezuela, India, Pakistan, and Turkey.
Henley & Partners, which helped the Maltese government create the program, said it was “fully aware of the potential inherent risks in handling client applications for residence and citizenship and have invested significant time and capital in recent years to create a governance structure that is committed to the highest of standards, with due diligence at its heart.”
It added that "ultimately it is the responsibility of the countries involved to investigate and vet applicants."
The importance of due diligence in the RCBI industry
The firm denied any systematic issues, adding that "only a very small percentage of applications... have later been called into question or been found to have been potentially misused."
Maltese Economy Minister Silvio Schembri also defended the country’s RCBI program.
“Most of the proceeds went into a fund which was to be used only when needed...if it weren’t for the pandemic, we would have kept on going on with our business and we wouldn’t even have needed to resort to the money made from passport sales,” he told media.
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