The due diligence and the government interaction aspects in the citizenship programme, which will be administered by Henley and Partners Holdings plc, will be ring-fenced and carried out by separate group entities to avoid any potential conflicts of interest, according to Eric Major, the company’s CEO.
His assurances were made in the wake of harsh criticism levelled by the Opposition and also from other quarters that the idea of a company getting paid for accepting applications when it is directly involved in their validation was conflicting and dangerous.
Mr Major sought to allay such fears, saying that the due diligence and promotional aspects were totally independent operations, with a different team head and staff skill set.
“There is a Chinese Wall between both entities which in fact will operate in different office premises,” he told The Sunday Times of Malta.
Mr Major added that as concessionaire, his firm was bound by very strict obligations regarding the promotion of this programme. He said that this was relevant due to the fact that previous residence schemes had run into serious problems, particularly between 2008 and 2010.
The lack of regulation and due diligence on applicants led to a situation in which such programmes were being promoted in countries like Iran, and China as a “Schengen Residence for sale”, he said.
Questions were also raised about the fact that Malta would be one of the very first countries outside the Caribbean to introduce a scheme whereby citizenship could be acquired against a fee, rather than being linked with investment. Throughout the debate, the Government was also criticised for not heeding Henley’s advice to link this scheme with investment.
Mr Major clarified that Henley had told the Government to consider such an option but at the same time warned this would take more time to implement. He added that, ultimately, the decision rested on the Government, saying that in the company’s opinion, starting off with a donation option only was the right way forward.
Mr Major refuted claims that Malta’s programme is unique, citing similar models that have been introduced in Spain, Portugal, Cyprus and Austria.
Regarding concerns on the due diligence of applicants, Mr Major said Henley was assisting the Government to create the most comprehensive and thorough system in the world.
He explained that there will be a four-tier application process, including a pre-screening and both formal and substantive initial checks by Henley and Partners, followed by a thorough due diligence check and background verification by independent international firms. The latter include IPSA International, Thomson Reuters, The Risk Advisory Group and others. Nevertheless, the final say rests with the minister.
Mr Major also said that Henley would be handing over to Identity Malta all the documentation relevant to the applicants, not just documentation on each and every candidate.
According to Henley, less than five per cent actually take up residence in the country of their new nationality. These are very wealthy individuals and families who have a good multiplier effect on the economy.
Regarding the appeal filed by Arton Capital, which missed out on the tender awarded to Henley, Mr Major said he suspected that this was motivated by the fact that success in Malta would undermine Arton’s efforts to reap maximum benefits from a similar programme in the offing in Bulgaria.
Mr Major said his company had been active in this field for nearly 20 years, adding that the fact it had coined the term ‘residence and citizenship planning’ some 15 years ago was clear testament to this.