The underworld of EU golden visas, Cyprus Papers edition
The week in corruption, 28 August 2020
Photo by AlexiaD on Shutterstock
Anti-corruption has 99 problems and European ‘golden visas’ are one.
Dozens of convicted criminals, fugitives and public officials have apparently bought European Union (EU) passports from Cyprus in recent years.
We have been warning about risky golden visa programmes since 2018, when the Organized Crime and Corruption Project first reported that these schemes were being used by the criminal and corrupt to access the EU.
Just like a luxury good, EU citizenship and residency rights can be bought. There are many buyers, and there is no shortage of suppliers, which explains why investment migration is a growing, multibillion-euro industry. Our 2018 report with Global Witness highlights the corruption risks posed by the sale of citizenship and residency.
Now, the Cyprus Papers – investigations by Al Jazeera – have confirmed our fears and suspicions on a scale much larger than before. They also show that, unless there is external pressure, member states will prefer quick profits over integrity and security.
That is why, on Monday, Transparency International called on the European Commission to take decisive action after two years of stalling.
The European Commission must take decisive action against Member States’ scandal-ridden golden visa schemes, which a new leak of documents shows remain vulnerable to corruption and money laundering.
On Thursday, we were pleased to see the European Commissioner for Justice tell journalists he is considering legal action against Cyprus, making it the Commission’s first bold public statement.
Time is of the essence. Among other things, the Cyprus Papers have shown that high-risk applications have been rushed through before reforms – that would have made their acceptance a clear breach – came into force, as well as right after.
Transparency International EU's Laure Brillaud discusses what should happen after the Cyprus Papers on Al Jazeera's Inside Story.
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Considering the amount of money involved – €8 billion since 2013 in Cyprus alone – the golden visa industry operates virtually unregulated. This creates a high risk of money laundering.
This week, Transparency International also sent detailed proposals to the European Commission on how to tighten up its fight against dirty money and urged the Commission to extend its rules to the golden visa industry, in addition to fintech.
The EU should do so not only to protect its own integrity, but also to ensure that it does not enable theft of public funds elsewhere by offering kleptocrats a safe haven.
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