IM Yearbook 2020/21

In conversation with KIERON SHARP, CEO of FACT Group
CORRUPTION
IS THE REAL RISK
The EU has pointed repeatedly towards
possible negative side-effects of
investment migration, including money
laundering, tax evasion and corruption.
In your opinion, does investment
migration pose a security risk?
I think it’s worth to take a step back at first and
consider that people have always invested in
other countries as a means to be able to live
there or to improve their freedom of lifestyle.
The only thing that golden citizenship and
golden visa programmes have done is to
formalise the process. Any form of migration
presents a potential security threat and,
therefore, security must be a major factor
for investment migration programmes. No
country wants convicted criminals amongst
their new residents or citizens and increased
measures are being put in place to ensure that
the people who are going to become citizens
or residents are ‘fit and proper’ individuals.
The programmes that we at FACT work with
all have very high standards and processes in
this regard, which are reviewed continuously.
Cyprus has stopped its citizenship-byinvestment
(CBI) programme after a
report by Al Jazeera alleged high-ranking
politicians were willing to issue passports
to convicted criminals. What’s your
reaction to this recent development?
All efforts to screen applicants fall apart if there
are corrupt individuals who are in a position
to influence decision-making so that people
who are clearly unacceptable can become
citizens. That’s why it is important to have
checks and balances built into the programme,
but it’s even more vital to ensure that there
are checks and balances on the influence that
politicians and senior government officials
have on a programme. You would like to think
that governments are always trying to ensure
that their systems prevent undue influence,
but the problem with corruption is that it’s a
secret offence. You can put everything in place
– all the laws, regulations and safeguards – but
it can still happen. A corrupt act is usually
between two people – so it’s very difficult to
spot. All forms of economic crime usually
involve an insider because large scale fraud
rarely happens completely from the outside.
The moment there are corrupt individuals
involved, it presents an opportunity to
destabilise an entire system or government.
What about the money laundering risk?
Money laundering is often thrown into the
discussion because it is a catch-all term for any
economic crime that doesn’t fit in a specific
category. It is a simple fact that people who
are involved in any criminal activity will have
to clean their money at some point. In some
countries it is completely unnecessary because
it doesn’t seem to matter that they got the money
from an illicit source, but in the majority of
countries it does, so they need to find a way to
make that money clean. Money laundering is
actually a big part of a criminal lifestyle. There
are not many people who commit a crime
once and then need to launder money just
once. So, using a CBI programme as a means
of laundering money is not a very effective
way. The main reason is that you don’t get
your money back. Laundering money means
you are taking dirty money and you get clean
money back. When it comes to investment
migration, that’s not the case. Additionally,
you can only do it once as you can’t keep on
investing in different programmes. It doesn’t
really help when you have got criminal profits
coming from your criminal enterprise. It’s not
the most obvious thing that people would
want to use a CBI programme for. The same
can be said about the tax evasion argument.
CBI programmes require one-off payments,
so, you are only tax evading once. It may be
that you become a citizen of a country with a
more attractive tax regime, but that’s not tax
evasion, not even tax avoidance necessarily.
Is there anything that could be brought
in from a European security perspective,
such as another layer of checks and
balances, that would give comfort to
member states and EU institutions that the
new citizens are fit and proper persons?
I recall that some 25 years ago there were
discussions on a variety of security issues,
such as co-operation between national police
forces and the harmonisation of criminal
laws. Very little of it actually happened, and
I think one reason for it is that in areas such
as security, policing and criminal justice,
countries still feel the need to protect themselves
as individual countries first and foremost,
with the intention of maintaining their own
sovereignty in such key areas. This is the
argument that EU-based CBI schemes make.
How do you think the investment
migration industry’s relationship
with the EU will develop?
The sector has definitely recognised that it has
come under scrutiny, but I think nobody is
scared of that. What the industry wants to do is
to make sure that it can withstand the scrutiny.
Based on my experience, I can say that the
programmes we work with are improving their
processes, standards and checks all the time.
Kieron Sharp, former
City of London Police
detective and head of
the economic crime
team at Interpol,
talks about the threat
to EU security that
investment migration
programmes
bring about.
Kieron Sharp has
BIO been in charge at
FACT since 2006,
overseeing the content
protection and antipiracy
response to huge
technological changes in
the audio-visual landscape.
His 30-year career with
the Metropolitan Police
and City of London Police
included a four-year
secondment to Interpol as
Head of the Economic Crime
Department and culminated
in the position of Detective
Chief Superintendent in
charge of Specialist Crime
Operations in the City of
London. Kieron is also a
graduate of the Federal
Bureau of Investigation
(FBI) National Academy
in Quantico, Virginia.
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