An 88-page report published on Wednesday criticises many EU countries, including Portugal, and raises serious concerns over risks of money-laundering and to the security of the EU and its Member States.
Around €25 billion in foreign direct investment has flowed into the EU through these schemes over the last ten years. Portugal is among the front-runners, with an estimated four billion euros of this total being transferred to the country by third nationals seeking residence and/or Portuguese passports.
The report, compiled in conjunction with Global Witness, says golden visa schemes have seen the EU welcome over 100,000 residents, with Portugal, Spain, the UK, Hungary and Latvia topping the list of EU states where resident permits are most easily handed out to foreigners.
The report, titled European Getaway – Inside the Murky World of Golden Visas, says while huge volumes of money are involved, checks for money laundering and corrupt and illegal origins of the investment are not especially rigorous.
Portugal is specifically identified as an area that poses “high risks”.
Reference is made to a review in which a number of issues that make the residence programme for investment vulnerable to corruption are flagged.
“The lack of clear guidelines and the wide discretion given to public officials working in regional immigration and borders services offices open opportunities for inconsistent application of the rules”, the report reveals in its chapter on Portugal.
While some changes have been made to the programme following the arrest of high-ranking government officials and the former SEF Immigration Office chief back in 2017, “no significant adjustments have been made” since then.
Concern is also levelled at the fact that the Immigration and Borders Service does not check whether applicants are subject to ongoing investigations or open criminal complaints outside of Portugal.
“There also seem to be no checks on applicants’ source of wealth and funds used for investment”, says Transparency International, and added that “enhanced checks should be extended to all family members.”
Investigators at Transparency International have called for increased public scrutiny of successful applications, arguing that in addition to publishing details of the number of applications received, granted and refused, the government should also consider publishing the names of successful applicants.
The report also extensively quotes European Member of Parliament Ana Gomes, a stalwart of the ruling Socialist Party, who has expressed her opposition to the golden visa investment scheme.
Ana Gomes, who is also the Vice President of the European Commission of Financial Crime, recently said that the golden visa system is a “perverse scheme”.
She explained that golden visas which are aimed at encouraging investment, most notably in high-end real estate, stem from “a system that prostitutes European citizenship and is a threat to the safety of the Schengen zone.
“I believe it is a scheme importing corruption and organised crime to the European Union”, she continued.
Gomes explained that she is not against visas being handed out to select individuals at no cost who would benefit Portuguese society, though indicated that she would up the ante against golden visas being “sold in a system that favours corruption”.
The MEP based these claims on the fact that she was unable to obtain a list of golden visa investors due to Portugal’s restrictive privacy laws despite successive official requests. Gomes wanted the list in order to conduct a background check, but says she was denied this opportunity.
“I don’t want their home addresses or bank account details, all I want is their names, which has been denied to me”, explained the MEP, adding: “The only explanation I can find is that if I were to gain access to the list, I would find people on it with criminal records in their home countries and who had not been subjected to due diligence in Portugal by local authorities”.
The most popular means to obtain a golden visa is through an investment of 500,000 euros in real estate, with Chinese topping the list of visa recipients.
But Ana Gomes concludes, “China has a limit on transfers out the country of 50,000 euros a year, so it is obvious that the system can only be fraudulent or criminal.”