IM Yearbook 2020/21

HOW WE CONDUCT
IN-COUNTRY
CHECKS
IN A COVID WORLD
Trust and confidence matter more
than ever in a world turned upside
down by the pandemic. As the world
struggles to find a way out of the current
crisis, there is much that can be learned from
what happened in the run-up to Covid-19
taking hold and in the subsequent reaction
of governments businesses and individuals.
Investment migration provides opportunities
for individuals and their families to change
their lives for the better and for governments to
benefit from investment to improve the lives of
their citizens and future citizens. However, as we
know, it is vital that those applying for citizenship
through approved schemes are properly vetted
and verified to ensure they pose no risk to the
country to which they are applying for citizenship
nor to the countries to which they might travel in
the future using their newly acquired passports.
Complete Verification
Independent third-party due diligence is the
cornerstone of any citizenship programme
and numerous checks are required to verify
identity, location, property, financial interests and
personal information. Whilst some of this can be
verified through online checks, the only means
of carrying out a complete verification is through
in-country checks; visits to confirm addresses
and businesses and visits to local record offices
to check documents. This is particularly vital in
countries where digital records are non-existent
or where physical documents may be unreliable.
2020 has so far proved to be a challenging
year; for CBI and RBI programmes, for
applicants and for due diligence providers.
Lockdowns and restrictions on movement,
combined with the closure of government
offices, have slowed down the ability to apply,
process and verify. In the case of verification,
this has meant having to review on a daily basis
the situation in specific regions or countries
to assess the ability to obtain information, to
manage risks to agents and applicants and
to ensure that verification can be completed
satisfactorily. This may not always be easy
but communication with clients is crucial, as
is utilising a variety of methods to assess the
veracity of documents whilst maintaining
the highest standards of due diligence.
Ensuring Accuracy
Online resources can certainly offer some
solutions, but it is only through oversight by
experienced researchers and analysts that a
full picture of an applicant’s good standing
can be obtained and communicated to the
client. Whilst the overwhelming majority of
applicants to programmes are acting in good
faith and are not seeking to mislead or provide
fraudulent information, it is well documented
that there are some who may seek to use CBI
and RBI programmes as a cover for criminally
obtained wealth. A global pandemic may
also have given some the mistaken belief that
they can avoid detection during applications
if they think that less checks can be made.
In-country checks on residential and business
locations, finances and assets, and criminal
and civil records form the backbone of a
complete due diligence process, and, by and
large, these have all continued to be carried
out during 2020, though with some delays.
Detailed local knowledge should ensure
that, where there are intermittent interruptions
to travel, these can be overcome by alternative
means of verification or by referring back
to an analyst who can add their skills to the
mix. Identifying unusual behaviours or issues
with documentation requires sometimes
detailed understanding of cultural, political
and hyperlocal influences that need to be
reflected in the checks made in country
and online and then reported back to the
client in interim and final report stages.
That may also require a delay to standard
reporting timelines to ensure accuracy and
that all checks have been carried out.
On top of the ongoing need to ensure
that no shortcuts are taken in the due
diligence process, recent negative media
reports around some schemes mean that
due diligence is in the spotlight more than
ever. The Investment Migration Council’s
recommendations for best practice are to be
welcomed, yet it is vital that the investment
migration sector as a whole takes on board
and supports these measures. Pandemic or
not, there can be no cutting of corners in
any part of the verification process.
Pandemic
or not,
there can
be no cutting of
corners in any part
of the verification
process
Eddy Leviten
BIO is FACT’s Chief
Operating Officer,
managing all aspects of
FACT’s business. He has
over 30 years’ experience
in the creative industries,
retail, enforcement and
policy and was previously
Director General at the
Alliance for Intellectual
Property where he drove
policy across a range
of IP-related issues.
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