Caribbean

St Kitts CIP Gets Its First “Public Benefit Option”; Govt. Dismisses Reports of EU Investigation

St Kitts & Nevis has officially opened its Public Benefit Option (PBO) investment category to applications nearly a year after first announcing it and adding the category to the Citizenship by Investment Unit (CIU) website.

The announcement came during a webinar yesterday hosted by MSR Media and its affiliate MSR Hotels, the only approved “Public Benefactors” under the PBO so far. MSR Media is the same firm whose principal, movie producer Philippe Martinez, is taking the previous administration of the Saint Kitts & Nevis CIP to court in the US for running what he has called an “international scam.”

The head of the Citizenship by Investment Unit (CIU), Michael Martin, said the government fully backs the PBO. Questioned why it has taken so long to start accepting applications after announcing the stream, he responded that “now is the best time to launch.”

The elephant in the room

The webinar started with MSR Media discussing the growth of St Kitts & Nevis as a movie and TV show setting. Actors Elizabeth Hurley and Jeff Goldberg made brief appearances, offering anodyne remarks on the subject. It was not until the Q&A session at the end of the webinar that Martinez finally broached the subject many attendees had been hoping to hear more about: His ongoing case against the former administration, which he has accused of money laundering, corruption, and fraud.

Producer Philippe Martinez has not minced his words about the former CBI administration

It was Bloomberg’s Jim Wyss who raised the question on everyone’s mind, alluding to MSR’s letter from November and asking what had happened with that issue. Wyss was the author of last week’s widely shared Bloomberg article, Golden Passports for as Little as $100,000 Threatened by Crime Crackdown.

Martinez responded that the letter was “leaked to social media and the press” but that he nonetheless wanted to address the issue as openly as possible.He referred to the illegal discounting happening in the Caribbean as the main catalyst for the lawsuit. 

“It is an open secret in our industry [..] that anyone who is on the call right now – lawyers, agents – knows that some companies sold citizenship for a fraction of legal price, $70,000 or less,” explained Martinez. “They came up with some very fancy schemes called financing or discounting.”

He remarked that although such illegal discounting was a “cancer on the industry” known to all stakeholders, no one has done anything to stop it, and the task had therefore fallen to him.

Martinez said that he and his team had conducted an investigation and followed the money that led them to the problem and that “some officials and some companies might have created a national risk for the US based on the evidence we found.”

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The producer emphasized that the issue was in the past, that his gripe concerned specific companies and individuals unrelated to the current administration, and that it was a US-related matter since ” the citizenship was sold in US dollars using a US bank. Some were US citizens, so I cannot say more.” 

Although St Kitts & Nevis had been the best-performing CIP, Martinez argued, the new Prime Minister and Attorney General knew that they had to change the program to protect it against fraudulent activity. He also said that governments turning a blind eye to illegal discounting is one of the main factors in growing EU concern over anything CIP.

Wyss proceeded to ask the government representatives present on the call for their take on the same matter, but Attorney General Garth Wilkin declined to comment, pointing out that the lawsuit was a private matter concerning Martinez and the individuals implicated.

Wyss also asked about the alleged EU investigation into Caribbean CIPs, on which he had reported the week prior.

Attorney General Wilkin gave an emphatic response, claiming that the government was “not aware of any investigations into any program” and that it was “in constant dialogue with the EU.”

The AG also said the EU was meeting with top Caribbean officials in Dominica this week but did not offer details on what would be on the agenda. He added the administration was on good terms with the EU and that it readily provided the European Commission with any and all information it requested while highlighting the importance of CBI to the country’s economy.

How has higher pricing affected application volume?

Questioned about the new regulations and price points, CIU Head Martin stood firmly behind the government’s decision: “We have decided to exit the race to the bottom,” he said. “That race is one of the causes of the issues we have with the UK and the EU […] we will not enter that race.”

Martin was adamant that the new price point, which is twice as high as other Caribbean programs, is right. Martin indicated he was not considering the competition and, instead, insisted that what St Kitts & Nevis offers “is very valuable and should be treated as such.”

AG Wilkin argued that lower pricing is a cause for concern among global superpowers, fueling rumors regarding the six demands the EU reportedly raised with the Caribbean CIPs in July 2023. 

“Other countries setting low prices are risking geopolitical scrutiny,” Wilkin continued. “Saint Kitts isn’t.”

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Ahmad Abbas AdministratorAuthorSubscriberParticipant
Director of Content Services , Investment Migration Insider

Ahmad Abbas is Director of Content Services at Investment Migration Insider and an 8-year veteran of the investment migration industry.

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