Cyprus to strip 26 golden passports given to investors after uproar
Cyprus as started procedures to revoke 26 golden passports, a minister said, after an investigation into possible violations of the EU member's citizenship-for-investment scheme.
The move comes after it emerged that the EU member had granted citizenship to Jho Low, the Malaysian financier allegedly at the centre of the Asian country's multibillion-dollar 1Malaysia Development Berhad state fund scandal.
A Reuters investigation published in October revealed that wealthy relatives and allies of Cambodian Prime Minister Hun Sen have been buying foreign citizenship, with eight members of his inner circle receiving Cypriot passports.
We have to acknowledge that in the early years mistakes were made. Isolated albeit, but not insignificant"
"The council of ministers today affirmed the will of the government for strict adherence to the terms and conditions of the Cyprus investment programme," the Cypriot interior minister, Constantinos Petrides, told reporters after a four-hour cabinet meeting.
Petrides did not disclose nationalities or identities of those affected, but said it "also concerned those" whose names were mentioned in media reports.
Cypriot sources said the group included nine Russians, eight Cambodians, five Chinese nationals, two Kenyans, one Malaysian and one Iranian.
Overriding the regulations to issue a passport at short notice, as appears to have happened in Low's case, requires a special decision of the country's cabinet.
Cyprus has had a citizenship for investment plan in place since 2013, under which a minimum €2m ($2.2m) investment can buy a passport and visa-free travel throughout the European Union. The country has earned about €6bn from issuing about 4,000 passports under the scheme since it was launched to help the economy recover from a banking sector collapse.
Cyprus has faced pressure from Brussels to reform its citizenship-for-investment scheme, which the European Commission has said may help organised crime gangs infiltrate the bloc.
"We have to acknowledge that in the early years mistakes were made. Isolated albeit, but not insignificant," Cypriot Finance Minister Harris Georgiades told a business conference in Nicosia.
"Substantive corrective measures related to the program have come into effect since the beginning of this year."
In February Nicosia updated its criteria, imposing more stringent due diligence procedures.
Petrides told reporters that the cabinet was determined to "strictly adhere" to the criteria, which were now "much stronger". Nicosia has defended its passport offer as "a driver for economic growth in the construction industry and for services offered by lawyers, accountants and other professions".
Cyprus, an EU member since 2004, is one of three EU states — alongside Malta and Bulgaria — to run a scheme selling citizenship.
Subscribe to International Investment's free, twice-daily, newsletter
More on Expats
