London: The UK Investor Visa (Golden Visa) scheme is now on the verge of rebuilding because of its lack of background checks on applicants. Hundreds of applications, mainly Russian oligarchs, were fast-tracked without any thorough due diligence checks.
The Golden Visa scheme of the United Kingdom is slowly posing a threat to the country because of the illicit flow of money.
The Center for American progress – an expert advisory organization working closing with US President Joe Biden’s administration, also stated that “stronger action” against money laundering is required from the UK.
Significant reforms are needed in the coming period so that the UK government can replicate the success of other well-run programmes, particularly in the Caribbean. The citizenship by investment programmes in the Caribbean Islands are actively involved in making economies stronger, with quality applicants accepted only after independent due diligence by renowned international firms.
According to Liberal Democrat peer Lord Wallace, who has tabled an amendment to the nationality and borders bill in the House of Lords, seeking the UK Investor Visa suspension till the government review of the scheme is published.
The Guardian quotes a report ‘Red Carpet for Dirty Money’ published in July 2021, warning proceeding weakness of the Golden Visa scheme. It emphasized that the UK relies inordinately on banks to conduct due diligence on money laundering and other criminal checks as the government has a minimal vetting process.
Along with the demand to urgently publish the review, the report also encouraged independent due diligence checks on the applicants. In contrast, many Caribbean countries offering economic citizenship have stringent multi-layer due diligence processes to filter only high-quality investors into their programmes.
Most of the Caribbean countries offering citizenship by investment partner with international independent due diligence firms such as Thompson Reuters, Kroll, FACT UK and many others – which conduct multi-stage checks on the applicants, including site visits to the home country of the person obtaining citizenship.
According to government data, small island nations offering economic citizenship charge an additional $7,500 from the applicant as ‘Due Diligence’ fees, which is diverted towards which is used for vetting procedures.
In most cases, a team reaches out to the applicant’s home country to carry out a thorough investigation by checking the business, source of funds, schooling, medical history, and police records before clearing an applicant for further processing. And, citizenship units rely upon due diligence firms on the final decision.
Russia based agents primarily dealing with the Golden Visa scheme of the UK also matched the tone with Lord Wallace and said that the UK must implement an independent specialized vetting process to clear applicants obtaining investment visas of the country.
Industry stakeholder based in Russia, Residence Investments, said, “Britain was locked in arduous discussions with the EU and inside its own government for three and a half years to iron out an agreement before BREXIT took effect, disrupting the region’s economy. In January 2020, Britain finally left the EU, kicking off the next phase of the Brexit process. It was time when the country required financial upliftment and Golden Visa is one fine option to channelized funds into the economy.”
AAA Associates Immigration Services said the only lax in the process of investor visa is due diligence and if the government is able to provide external due diligence to the Tier 1 Investor Visa, it will provide exceptional quality applicants who will not only help the economy but they will become an asset for the country in future. Spending over £2 million is only feasible for a successful businessman or a criminal and here a due diligence comes in, which plays a role to differentiate both.”
What is UK Investor Visa (Golden Visa)?
Though the actual visa category varies from country to country, investment visas are known as golden visas.
Golden Visas are considered a much more convenient method to obtain citizenship. Mainly wealthy individuals apply for such visas because it is a simple way to settle in sophisticated Western countries. After all, they need to make the requisite investments as decided by the government to which one applies. In comparison to applying for permanent residency (PR), the investment also greatly reduces the waiting period.
Many high-net-worth individuals use a golden visa to settle in the United Kingdom, the United States, Canada and many European and Caribbean countries. For example, in the United States, an individual can obtain a golden visa by investing $1.8 million.
To apply for a Tier 1 (Investor) visa, you must have at least £2,000,000 in investment money. You must be at least 18 years old to apply for this visa. Be able to show that the money belongs to you or your husband, wife, unmarried or same-sex partner and that you have opened an account with the UK regulated bank to deposit the funds.
There are three different slabs under which an investor can apply for Golden Visa. Invest £2 million to settle after five years and invest £5 million or £10 million to settle after 3 or 2 years respectively.