To hear the Americans describe our bit of paradise, you would think we are overrun by the criminal element and contribute little good to this world. According to the March 2017 International Narcotics Control Strategy Report (Volume II) on Money Laundering and Financial Crimes, Antigua & Barbuda “is an offshore centre which continues to be vulnerable to money laundering and other financial crimes”.
The report, published by the United States Department of State, Bureau for International Narcotics and Law Enforcement Affairs, added that we are also “a transit point for illegal drugs going to the United States and Europe”.
When we read reports like this, it gives us a glimpse into other people’s perspective of our twin island state. That perspective also provides us with valuable information that is sometimes not disseminated locally for a variety of reasons.
Before you start packing your bags to escape from this rum-town of reprobates, this description is nothing new; plus, we are in good company. We are actually among a long list of over 85 countries that are all described as “a major money laundering country”; which, in turn, is defined by statute as one “whose financial institutions engage in currency transactions involving significant amounts of proceeds from international narcotics trafficking”.
Nothing to be proud of but it makes one wonder why the United States of America is not on their own list. We know that the US State Department is the author but, if we are being honest, which country’s financial institutions engage in more currency transactions involving significant amounts of proceeds from international narcotics trafficking than the good ole’ US of A? A bit of hypocrisy, don’t you think?
The thing that caught our eyes, however, was the part on our Citizenship by Investment Programme (CIP), which we have been led to believe is considered well-run and has been given a basic thumbs-up by our first world neighbours to the north.
The report takes a slightly different view of things and stated, “Antigua and Barbuda also operates a Citizenship by Investment Programme (CIP) that increases its susceptibility to money laundering and other financial crimes.”
A fair point that we are willing to accept but then the State Department lets us know how the authorities really feel. In stark contrast to our administration, the Americans describe our CIP as “among the [laxest] in the world” and in their assessment, “it does not maintain adequate autonomy from politicians to prevent political interference in its decisions.”
We can’t say that we are entirely surprised by the damning assessment of our programme but we must admit, seeing it in black and white, in an official US Department of State report, made us feel ‘a way’.
As much as we criticise the Americans for their hypocrisy and lambaste them for their bullying tactics, we really can’t defend the programme against the criticism.
First and foremost, we are not in a good position to assess any citizenship by investment programme; not just our own.
We have long harboured concerns with our programme (and have made them known from the onset) but we do not have the knowledge to say how our programme stacks up against others in the world. We really cannot say whether it is “among the [laxest] in the world”.
What we can say is that, in our view, we agree it “does not maintain adequate autonomy from politicians to prevent political interference in its decisions,” but that seems to be by design.
The transparent parts of our CIP legislation were removed under the notion that the super-wealthy people buying our citizenship and passports were in need of anonymity for security reasons. The public was not allowed to peruse the list of applicants or new citizens to lend more eyes to the vetting process.
What is also interesting is how harsh the criticism was of our CIP. In the case of St Kitts, they talked of the “programme’s prior lax vetting” and said that “despite recent efforts to improve the application process and vetting procedures, the CIP continues to be afflicted by significant deficiencies in vetting candidates and conducting due diligence on passport and citizenship recipients after they receive citizenship.”
Sure, it’s bad but their lax-ness is described as “prior” and the report did not give the impression that their CIP currently ranks as “among the [laxest] in the world”. The description for Dominica and St Lucia provided the same impression.
So, what are we doing to field such harsh criticism? What makes our process and product so different? We have been told it is superior in every way, but the United States does not think so. And if the US does not think so, then others may adopt that position as well; if they have not already. They do not produce these reports for nothing.
The Americans may be hypocritical but they are world leaders and other countries rely on their foreign affairs “intelligence” for decision making, so this is not a good development.
It certainly does not help our de-risking problems in the banking sector. As we travel down this bumpy CIP road, it may very well turn out that we look back one day and determine that the journey was not worth it. Hindsight is truly 20-20.