BASSETERRE, St. Kits - THE Federation’s Citizenship by Investment Programme is under the spotlight of the USA’s Financial Crimes Enforcement Network (FinCEN), as that body has issued an Advisory claiming that passports granted under the programme are being used by some individuals to commit financial crimes.
The Advisory, titled “Passports Obtained Through St. Kitts and Nevis Citizenship-by-Investment Program Used to Facilitate Financial Crime”, was issued yesterday (May 20).
The Programme grants citizenship to non-nationals who make an investment either by the purchase of property to the tune of US$400 000 or making a deposit into the Sugar Industry Diversification Foundation (SIDF) to the tune of US$250 000.
“The Financial Crimes Enforcement Network (FinCEN) is issuing this Advisory to alert financial institutions that certain foreign individuals are abusing the Citizenship-by-Investment program sponsored by the Federation of St. Kitts and Nevis (SKN) to obtain SKN passports for the purpose of engaging in illicit financial activity.
“Financial institutions can mitigate exposure to such risk through customer due diligence, including risk-based identity verification consistent with existing customer identification program requirements,” the Advisory reads.
The FinCEN expressed its belief that persons are using the programme to mask their identity in order to avoid sanctions of the United States of America.
“FinCEN believes that illicit actors are abusing this program to acquire SKN citizenship in order to mask their identity and geographic background for the purpose of evading U.S. or international sanctions or engaging in other financial crime. For example, FinCEN believes that several Iranian nationals designated by the Office of Foreign Assets Control (OFAC) have obtained passports issued through the SKN Citizenship-by-Investment program.”
According to the Advisory, the St. Kitts and Nevis Citizenship by Investment Programme lacks rigidity in its control of who should be made citizens of the twin-island Federation.
“...The SKN program is attractive to illicit actors because the program, as administered, maintains lax controls as to who may be granted citizenship. While the SKN government has publicly pledged to improve these controls, FinCEN believes that they remain ineffective.
“For example, in 2013 the SKN government announced that all Iranian nationals were suspended from participating in the SKN Citizenship-by-Investment Program. Despite this public assurance, FinCEN believes that Iranian nationals continue to obtain passports issued through the program. As a result of these lax controls, illicit actors, including individuals intending to use the secondary citizenship to evade sanctions, can obtain an SKN passport with relative ease.”
