Cyprus Engaged in ‘Mass Illegality’ in Cash-for-Passports Scheme

Cyprus’s government broke the law on countless occasions in granting citizenship to thousands of people in a now discredited passports-for-cash scheme, an official inquiry has found.

The east Mediterranean island awarded citizenship to 6,779 people between 2007 and 2020, the vast majority of them Russians, before the scheme was scrapped. Most were issued by the right-wing administration which assumed power in 2013 and was re-elected in 2018.

“In the view of the committee during the material time there was mass illegality … exceeding the relevant law on the part of the council of ministers, or the councils of ministers (of the time) and others concerning citizenship to family members ocf investors,” said Myron Nikolatos, an ex-chief justice who headed the government-appointed, independent commission of inquiry.

Cyprus’s council of ministers, or cabinet, was responsible for rubber-stamping passport approvals under the investment scheme which ran until Nov. 2020.

Of the 6,779 who were granted citizenship, about 53 percent of them were relatives of the principal investor and were wrongly issued with passports, Nikolatos said.

He said authorities continued issuing passports to dependents even though the government was warned in 2015 and 2016 by its chief legal adviser that the practice was possibly illegal.

Nikolatos handed over the results of a nine-month investigation to the island’s attorney-general on Monday.

A spokesman for the Cypriot government said it needed to study the report’s findings and would have no further comment for the time being.

Cyprus shut down the scheme in late 2020 following disclosures that not only did bona fide investors benefit from it but also fugitives from justice or politically connected persons, who would be granted a passport for a minimum 2 million euros ($2.41 million) investment.

An interim version of the heavily redacted report issued in April found fugitives piggy-backing on an application by their spouse as well as cases of properties being sold several times over to different investors through “cancel and release” agreements once citizenship had been obtained.

A Cypriot passport grants visa-free travel, working and residency rights throughout the 27-nation European Union.

The European Commission launched infringement procedures against Cyprus over the scheme last year, arguing that granting EU citizenship for pre-determined payments, without any genuine ties to the state, undermined the integrity of EU citizenship.

(Reporting by Michele Kambas; Editing by Mark Heinrich)

This article was written by Michele Kambas from Reuters and was legally licensed through the Industry Dive publisher network. Please direct all licensing questions to [email protected].