European authorities have launched proceedings against Cyprus and Malta following the latest revelations of criminal abuse of citizenship-by-investment programs in the EU's two southernmost jurisdictions, and opened an inquiry into Bulgaria, which offers a similar scheme. The programs, which Bulgaria, Malta and Cyprus set up in 2005, 2007 and 2013 respectively, grant wealthy individuals national citizenship—a "golden passport"—in exchange for their pledge to make a significant investment into the local economy, allowing them to travel freely throughout the bloc and potentially conduct financial transactions with reduced scrutiny. Concerns that the schemes facilitate illicit finance reignited last week after an undercover...
Negative news and tighter rules governing controversial citizenship-by-investment schemes have led some banks in Cyprus and Malta to review their internal policies for clients holding or acquiring "golden passports," sources say.
Malta plans to create a new agency to administer its controversial citizenship-by-investment scheme after years of relying on private firms to scrutinize the wealthy overseas investors seeking to obtain EU passports, an official told ACAMS moneylaundering.com.
The European Commission issued letters of formal notice to Cyprus and Malta, launching infringement procedures against the countries with regard to their investor citizenship schemes, also referred to as golden passport schemes.