Latvia’s Financial Intelligence Service (FIS) has identified more than 20 companies involved in what it describes as fictitious investments under the country’s golden visa share capital program, according to an investigation by Latvian public broadcaster LSM’s De Facto program.
Approximately 200 foreign nationals are alleged to have invested more than €10 million in the share capital of these companies. More than 50 have already received temporary residence permits (TRPs), and the total number of family members who have received permits or submitted applications reportedly exceeds 100.
How the Alleged Schemes Worked
Under Latvia’s residence by investment (RBI) program, foreign nationals can obtain a TRP by investing €50,000 or €100,000 in the share capital of a Latvian company that pays at least €40,000 annually in taxes. The program attracted nearly €6 million last year and granted permits to 341 individuals, including investors and their dependents.
According to the FIS, invested funds in the suspected cases did not remain in genuine business activity. Money was reportedly routed back to scheme organizers through loans, fictitious transactions, vehicle or real estate purchases, or transfers without economic justification.
In some instances, investors were allegedly told in advance that they would not receive dividends and could not recover their capital.
FIS head Toms Platacis told De Facto that in certain cases the statutory €50,000 was paid in circular increments rather than as a single genuine investment. He described one pattern as “ten thousand, paid five times in a circle.”
Companies Under Scrutiny
No finding of wrongdoing has been established against any of the companies named in the investigation. The following were examined in the De Facto report.
One Portugal-headquartered company, founded approximately 18 months ago, attracted nine investors who applied for TRPs last year.
Its shareholder register lists 30 individuals from India, Afghanistan, Pakistan, Turkey, Chile, Malawi, Syria, Vanuatu, and other countries, each holding a class of shares that carry no voting rights under the company’s charter. Office of Citizenship and Migration Affairs (OCMA) data cited in the report indicate the company had one of the highest investor rejection rates in the program.
A representative told De Facto the firm had operated in Portugal for nine years and managed a portfolio of €200 million, but did not respond to written follow-up questions.
The investigation also identified a single owner controlling several companies, each attracting the maximum permitted number of investors.
Two of those companies reported zero turnover and losses in 2024. In written comments to De Facto, the owner said one was newly established and that income in another was recorded in a later period. A planned €10 million student hostel project collapsed after investors withdrew, he added, and a smaller residential development in Riga is now under consideration.
Five further companies linked to a single businesswoman also appeared in the investigation, three of which carry outstanding tax arrears. Investors brought in by those companies received TRPs in 2022, 2023, and 2024, but applications submitted last year have been rejected or remain pending.
A lawyer representing the companies told De Facto that if all legal requirements are met, “nothing more can be demanded of the company.”
A Mixed Track Record
Lursoft data cited in the report show that seven of the 78 companies attracting foreign investors over the past five years have since suspended operations.
Approximately 20 carry tax arrears. Roughly half reported fewer than five employees, and about half met the €40,000 annual tax threshold.
Latvia’s golden visa has been operational since 2010. Its early years generated more than €1 billion in investment, the bulk from Russian nationals, but program volume fell sharply after tighter restrictions followed. The share capital route now accounts for 0.3% of total non-resident investment in the Latvian economy.
OCMA data nonetheless show a recovery: The program received 109 applications last year, more than five times the 20 filed in 2021. Roughly one in three is approved.
Regulatory Pressure Mounting
The State Treasury has called the program impractical and has pushed for a money laundering risk assessment for at least five years. Last week, the Saeima ended the government securities route, which attracted just 88 investors over its decade of existence. For now, the share capital route faces no equivalent restriction.
Since 2012, the State Security Service has added more than 30 permit holders to its blacklist and warned that vetting cannot guarantee an investor will not pose a security threat. Deputy head Eriks Tsinkus told a parliamentary investigative commission that gathering information on applicants from China, Central Asia, and Africa presents serious difficulties.
He also noted a trend of individuals who originally obtained TRPs as Russian citizens now seeking renewals on Israeli passports.
Ilze Briede, head of OCMA’s Migration Department, acknowledged at the commission that a company conducting no genuine business activity but formally paying the required taxes is difficult to remove from the program. “In our view, this criterion is currently insufficient,” she said.
Several members of parliament are now considering legislation to close the share capital route entirely. Jānis Dombrava, head of the parliamentary investigative committee, described the program as “a crude way to circumvent the system.”
Ainars Latkovskis, chairman of the Saeima National Security Committee, characterized the disagreement between the Ministries of Economy and Interior as difficult to resolve in the current parliament.
Māris Vainovskis, deputy chairman of the Foreign Investors’ Council of Latvia, framed the core question at the commission: “Is our goal to issue a residence permit? Or is our goal to create an investment?”
IMI has reached out to the companies named in the De Facto investigation for comment but has not received a response. We will update this article if any party replies to our inquiries.
