GOVERNMENT OF CYPRUS CONDUCTING THOROUGH "ENHANCED DUE DILIGENCE" ON ALL CITIZEN BY INVESTMENT (CBI) APPLICANTS

GOVERNMENT OF CYPRUS CONDUCTING THOROUGH "ENHANCED DUE DILIGENCE" ON ALL CITIZEN BY INVESTMENT (CBI) APPLICANTS

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We note that the Government of St. Kitts has reported that it has taken in 1200 applicants for its low-cost $150,000 Hurricane Relief CIU (CBI) Program. At the same time,  the Government of Cyprus has announced that it is limiting the total number of CBI passports issued annually this year to 700, and it will take up to six months to conduct enhanced due diligence upon the applicants. Does Cyprus know something the authorities in St Kitts don't?

Absolutely.

The short answer is that individuals conducting due diligence on CBI applicants (which should be enhanced due diligence, not merely due diligence-level compliance) must have sufficient time to thoroughly examine each applicant, wait for inquiries made abroad to return, and if necessary perform follow-up on the results. If they are under pressure to complete files, due to a large backlog of pending cases, true enhanced due diligence, which cannot be rushed, may suffer, and unsuitable applicants will be approved, only to subsequently get arrested, with their CBI passports in hand.

CBI jurisdictions must accept only quality applicants, which they cannot do if they are into quantity, for the sole reason of maximizing cash flow. Given St Kitts' past history of abject failures in its CIU program, unless it wants to see further compliance failures, with the attendant negative publicity it would do well to put a ceiling on passport issuance, and at the same time truly raise its level of inquiry to enhanced due diligence, which history tells us it does not conduct upon its applicants.  

Chronicles of Monte Friesner - Financial Crime Analyst  

Contributed by Kenneth Rijock - Financial Crime Consultant