- Ilma Danielienė
Reaction to the Al Jazeera Investigations video of Cyprus
Yesterday evening I reviewed the entire Al Jazeera Investigations video of four main protagonist groups ostensibly involved in granting a Cyprus passport to a fictional Chinese investor.
A British couple promoting property in Cyprus;
A Cypriot lawyer;
A Cypriot Member of Parliament, together with his staff members;
The Speaker of the Cyprus Parliament.
My impressions are the following.
1. The audience is being shown selected footage by Al Jazeera. We don’t see the full context: only what Al Jazeera shows us. Please keep this in mind.
2. Not a single crime takes place in this video. No application is submitted. No due diligence, KYC and AML process takes place. Each of the protagonist group mentions that a review has to be made. Yet Al Jazeera’s conclusions are robust: The programme is corrupt. And so are Cypriots, at the highest political level, and across the entire spectrum.
3. This reportage is neither fair nor balanced in terms of reporting. If this were a fair and balanced reporting, you would have heard from a far more representative group of people:
You would have received an overview of the complete KYC and due diligence process.
You would have heard from a banker, without whom no transaction can take place.
You would have heard from members of the Committee for Supervision and Control of the Citizenship by Investment Programme, or by a representative of the Ministry of Finance, or the Cyprus Investment Promotion Authority, or others.
You would have heard from actual beneficiaries who have invested and been granted a passport.
4. My company, and I personally, have reviewed the applications procedure for the Cyprus Citizenship by Investment Programme. We have spoken to a number of intermediaries (lawyers, accountants, banks, property agents) involved. Each of the intermediaries we have spoken to have assured us that the procedure is difficult but transparent. This does not mean that all applications are approved: many are rejected. The conclusions we draw are far different from that of Al Jazeera.
5. The most difficult part, in terms of KYC and AML, is actually conducting a financial transaction for the asset. I can confirm this from other transactions that have occurred in Cyprus (not related to the passport programme) and from operating bank accounts as a company and as a person. I can also confirm that there appears to be a double standard for foreigners, who are under a lot more pressure to confirm their KYC/AML requirements, and pay higher fees, than Cypriots.
6. In the Al Jazeera video: The discussions that do take place do so in informal settings, prior to signing any kind of contract or starting any kind of vetting process. In other words, each protagonist group here is selling their services. As anyone who has been in a sales situation is aware, there is always going to be exaggeration and hyperbole.
7. In the Al Jazeera video: Much has been made of the idea that applicants can avoid due diligence by having a wife or son apply for citizenship, and then slipping someone in with a criminal record. That’s not true. The due diligence applies to every applicant.
8. On the issue of whether a convicted criminal could receive a Cypriot passport: according to the letter of the due diligence process, no. If this crime has been recorded and published, it will be found. From that point onwards, it is the responsibility of each of the speakers who maintain that they can avoid a criminal conviction to justify that. My opinion, based on prior experience, is that they cannot. They are over-selling. Or lying.
9. In the Al Jazeera video: At one stage, the lawyer says something to the effect that “not a single passport case has been clean”. This is his personal opinion, not established fact. He is, again, saying that in a sales situation. It hardly reflects well on him. But it is also not representative of the facts, and a media organization should present a fair and balanced viewpoint.
10. I was most disappointed by the role of the Speaker of Parliament. He should know better than to be making promises that he cannot keep to any visitor, let alone one interested in a citizenship by investment application. He should also know better than to confuse his statutory responsibilities with his individual gain. However, I also reflect that hyperbole, solipsism and conflict of interest characterizes many Cypriot politicians. And not only.
The CIP programme has a verifiable KYC/AML/approval process. Like all processes, there may be imperfections, but it is broadly in line with industry best practice;
The sole responsibility for citizenship remains that of the EU Member State, not the European Union;
Cyprus is in compliance and receives generally high rankings from compliance with AML and equivalent standards;
To suggest based on the interviews published that the entire CIP programme is corrupt and that all people who have received citizenship from it is unacceptable;
The journalistic standard of the Al Jazeera reportage is neither fair nor balanced, and meets none of the objective requirements of reporting.
I believe that any well-informed viewer can draw their own conclusions from this.