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British citizenship: the £2m must-have for wealthy foreigners, with few questions asked - TELEGRAPH

JANUARY 22, 2022

Thousands of 'golden visas', issued to people from places such as Russia, China and Kazakhstan, are now under review

By Matt Oliver 

Golden visas issued between 2008 and 2015 were subject to almost no background checks, it is claimed

For the discerning multi-millionaire or billionaire, there are plenty of things a mere £2m will buy. Perhaps the most priceless of all, however, is British citizenship.

Under what is known officially as the tier 1 investment visa - and unofficially as the “golden visa” - applicants who invest this sum in the UK can stay for at least three years.

After five, they gain permanent residence (shortened to just two for £10m) and after the sixth they can secure their own blue passport.

It is seen by the mega-rich as one of the most attractive such schemes to have sprung up globally - but campaigners warn it has made Britain a safe haven for kleptocrats.

Thousands of visas issued to applicants from Russia, China, Kazakhstan, India, Saudi Arabia and other countries are currently under review by the Home Office amid fears they were not vetted properly. 

Transparency watchdog Spotlight on Corruption says the fiasco may have allowed Russian president Vladimir Putin’s cronies to gain footholds in the UK, as well as oligarchs and officials from other countries that may pose corruption and money laundering risks. 

A proposed amendment to the Government’s Nationality and Borders Bill, currently going through the House of Lords, could usher in the end of golden visas, while the Commons Foreign Affairs Committee is expected to discuss the issue as part of a new inquiry into dirty money from Russia.

Tom Tugendhat, the committee’s chairman, says MPs are looking at “all ways to defend our interests and partners against Russian aggression” following a recent visit to Ukraine.

“There are many issues to cover, from dirty money to foreign influence, but the most obvious area we need to consider is looking at the golden visa route that has seen many of Putin's allies set up in London,” he says.

First introduced by Gordon Brown’s Labour Government in 2008, in the teeth of the financial crisis, the idea behind golden visas was to attract investors and talented entrepreneurs desperately needed to boost the UK’s struggling economy. More than 12,600 have been issued over the scheme’s lifetime. 

But critics have become increasingly concerned by loopholes and the way the system is perceived abroad. 

Websites now allow the global rich to scan through different citizenships like items on a menu, with each country listed by price and various benefits on offer.

Visitors to Best Citizenships, for example, are told that the UK golden visa scheme is “the fastest in the world”, with a typical application turnaround time of one to three weeks. They are also promised benefits including the “best education and healthcare”, an attractive property market and a passport that is “powerful and respected in the world”.

Dominica, meanwhile, is advertised as the “cheapest”, costing just $100,000, and Grenada is promoted as the “best Caribbean” option at $150,000.

High-profile benefactors of the UK’s visa have included relatives of foreign government officials and a plethora of ultra-wealthy business people.

<img class="responsive lazy-image__img article-body-image__source" src="/content/dam/business/2022/01/21/TELEMMGLPICT000283348475_trans_NvBQzQNjv4BqNJjoeBT78QIaYdkJdEY4CnGTJFJS74MYhNY6w3GNbO8.jpeg?imwidth=480" alt=" Izzat Khanim Javadova, the daughter of an Azerbaijani oligarch, has run DJ nights." loading="lazy" width="1080" height="675"/>
Izzat Javadova, a DJ and cousin of the president of Azerbaijan

Those thought to have used the golden visa route have included Izzat Javadova, first cousin of the president of Azerbaijan and Madiyar Ablyazov, the son of an exiled Kazakh politician - among many others.

Javadova, also known as DJ Mikaela Jav, and her husband were targeted by the National Crime Agency which argued her funds were likely to have been obtained through corruption and theft in Azerbaijan. They denied the claims and last year settled with the NCA for £4m, admitting no wrongdoing.

Ablyazov, meanwhile, was issued a golden visa in 2009 after using money provided by his father. Mukhtar Ablyazov, a former Kazakh minister and banker, was alleged to have embezzled billions of pounds of assets in one of the largest ever frauds.

<img class="responsive lazy-image__img article-body-image__source" src="/content/dam/business/2022/01/21/TELEMMGLPICT000282146914_trans_NvBQzQNjv4BqOjwtMIBfBvsmIG0UzgZgYLxlL4JJZFr6G2BGlsAngeI.jpeg?imwidth=480" alt="Kazakh businessman and political activist Mukhtar Ablyazov" loading="lazy" width="2500" height="1559"/>
Mukhtar Ablyazov was alleged to have embezzled billions Credit: THOMAS COEX/ AFP

The UK High Court has issued warrants for Mukhtar Ablyazov’s arrest. Two years ago he was granted political asylum in France. Ablyazov claims he is being persecuted by the Kazakh regime.

And, according to a report by Channel 4 News and The Sunday Times in 2019, City lawyers and financial advisers also bragged about their success in securing golden visas for a family member of former Libyan dictator Muammar Gaddafi, the son of a corrupt Thai government minister and Iranian and Iraqi millionaires who were affected by sanctions.

Yet, argues Spotlight on Corruption, golden visas issued between 2008 and 2015 were subject to almost no background checks.

Throughout this time, now known as the “blind faith period”, the Home Office is said to have assumed that banks would check visa holders’ bona fides when they tried to open a bank account.

Banks, however, assumed a successful visa application could be taken as proof that due diligence had already been done - resulting in proper checks not being carried out by anyone. 

Meanwhile, judges at the Court of Appeal warned in April last year that rules for golden visas were “poorly drafted” and some applicants had been able to secure them despite their required investments ultimately ending up in Russia.

Just months later, the Financial Conduct Authority (FCA) revealed it had shut down a London-based wealth manager, Dolfin Financial, due to a complex scheme that allowed clients to pay just £400,000 rather than the required £2m. 

A report by Parliament’s Intelligence and Security Committee separately called for changes, too, warning that many Russians with links to Putin had become “well integrated into the UK business and social scene, and accepted because of their wealth”. 

Lord Wallace of Saltaire, a Liberal Democrat peer, believes the golden visa scheme poses a potential security risk to the UK and is also at odds with the tough stance taken by Priti Patel, the Home Secretary, towards other forms of migration. 

His proposed amendment to the Nationality and Borders Bill would tighten up checks on applicants further, or shut the scheme down if this cannot be achieved. 

“By continuing to allow people from non-democratic countries whose wealth has been acquired through political influence or corruption to settle here, we are undermining the quality of British democracy,” he argues.

“If you believe in re-establishing the sovereignty of this country, then the idea of selling citizenship like this undermines the whole principle. It also seems to be a huge anomaly in Priti Patel’s policy to otherwise restrict access to citizenship to those who are entirely clean.”

The Home Office rejects claims that checks were not carried out on golden visa applicants between 2008 and 2015 and says it has reformed the scheme twice to prevent it becoming a conduit for dirty money.

Banks must now carry out due diligence before bank accounts can be opened and applicants must provide evidence for the source of their funds going back for at least two years.

“As part of our work to prevent this route from corruption we are reviewing all Tier 1 investor visas granted before these reforms were made, and will report on our findings in due course,” a spokesman adds. “We have not ruled out making further changes if necessary.”

But Susan Hawley, executive director at Spotlight for Corruption, says there is little evidence so far that the Government is treating the matter with urgency.

“It has been known for a long time that the UK's golden visa regime poses very high risks to our national security,” she says.

“Given these risks, it is astonishing that the Government is in effect sitting on the review that it started four years ago.”

As the scheme continues, many of those granted golden visas since 2015 or earlier are now eligible for full citizenship.

It means, critics argue, that British passports are still up for sale - at least while the offer lasts.


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