St Kitts and Nevis (WINN): The importance of an escrow account requirement associated with the Citizenship by Investment Programme has been highlighted by Senior Government Minister in the federal government, Vance Amory.
Minister Amory, who’s also the Premier of Nevis, spoke to the escrow account matter following questions at the recent prime minister’s press conference about the possibility of the CBI attracting tainted funds and the negative impact this could have on the programme.
“Now the fact that the government has decided to put in an escrow account requirement dealing with all the funds which come in for investment through our developer, is to ensure that the use of the those funds as indicated by the developer that he has the funds for and on behalf of the applicant, that those funds are used for the purpose for which it is intended. We have to be careful of that because in some cases before now, we’ve had instances where citizenship has been granted and the investment money would have been received or would have been purported to have been received and the development is not completed and that is an issue that we are taking very serious consideration.”
The escrow accounts are intended to ensure that investment funds obtained under the CBI are protected for the purpose for which they are received, to protect the applicants of the programme from fraudulent activity.
Senior Minister Amory also pointed to due diligence having to be made at the bank level, a practice he indicated helps the federation in its bid to ensure that tainted funds are kept away from the CBI programme.
“Because the fact that you have the account held, the due diligence that has to be done by the receiving financial institution, strengthens the hand of the government in terms of ensuring that the source of funds, it’s not just a declaration by the applicant and the agent or the developer, but it strengthens the hand because the banks will require as well a declaration of the source of funds. So we are looking for due diligence on the part of the CIU, but the banks themselves are also engaging in their own due diligence to ensure that they are not being used in the transfer of illegal funds, in any activity which could be classified as money laundering or as aid to terrorist financing.”
The government says the steps being taken are intended to protect the federation against money laundering and fraudulent practices.
“So the steps which we are taking are not just protect the CBI, but it’s also protect the jurisdiction in terms of its integrity as a financial service, a part of the international financial market place and it is important for us to note that. I believe it gives us an edge or advantage over the other players in the programme, that the effort that St Kitts and Nevis is making to put in place those measures to ensure the integrity and to ensure there is no ease of transference or removal or utilization of illegal funds gives us that kind of quality programme of which the government could be proud.”
Chinese fugitive Ren Biao, according to Beijing, used US $350,000.00 from his alleged criminal gains to purchase St Kitts and Nevis economic citizenship in 2013.
China, which wants Basseterre-based Biao sent back to Beijing for alleged financial crime, accuses him of swindling hundreds of millions of dollars from several banks, friends and relatives before fleeing to St Kitts and Nevis.
Ren is on Interpol’s Wanted list – China has accused the federation’s government of habouring him instead of ensuring that he is sent back to China to face justice.
The government says the matter is currently being investigated.