The purpose of conducting due diligence in Citizenship by Investment programs is to ensure that applicants are not involved in criminal activities, money laundering, other financial crimes, or any illicit activities that would be detrimental to their application.
These are set up by governments to attract and approve individuals who are investing with legitimate funds. Conducting due diligence is a crucial aspect of CBI programs to prevent abuse by individuals who pose a risk.
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The due diligence requirements may differ among countries and are contingent on both the specific CBI program and the applicant’s nationality. The governments may impose stricter due diligence standards on applicants from countries with a history of corruption or money laundering or that are sanctioned.
Generally, the due diligence process in CBI programs comprises these steps:
Identity verification
Not only does the verification of true identity of an applicant is important to prevent fraud, but is an essential step in complying with the program’s regulations. This is done by checking the authenticity of a person’s identification documents, such as a passport, birth certificate, national ID cards and any further form of identification which varies from one country to the other.
Background checks
This involves a comprehensive check conducted on the applicant’s criminal record, financial history, the history of countries the applicant has resided in, and any other relevant information.
Source of funds confirmation
This verifies the origin of funds being used by the applicant to invest in the CBI program and to ensure the source of funds are not from any type of illegal activities.
The due diligence process is typically executed by a third-party firm hired by the CBI program. The firm would conduct interviews with the applicant, family members, employers, or friends, as well as verifying all the information submitted by the applicant.
Based on the due diligence report, the CBI department reviews the applicant’s records and decides on whether to approve their application.
Additional details regarding the due diligence process that is worth noting:
The due diligence process can take several months to complete. In most CBI programs, they run for 90 working days.
The cost of due diligence process can vary, usually amounting to $7,500 for the main applicant and $4,000 for further family dependents.
Here are some tips on how to successfully pass the due diligence process for citizenship by investment programs:
Be transparent about your background
It is important to discuss your eligibility with a trusted citizenship consultant. Applicants could have aspects that a seasoned citizenship company could overcome discussing openly these aspects with the client from the beginning to tackle them the most efficient way to present them to the government.
Provide complete documentation
The documents must be authenticated by either the Ministry of Foreign Affairs and Apostille, certified by the Notary, and verified by the banks or financial institutions to mention a few. The citizenship agency should help you with this.
Although most CBI programs do not conduct interviews, they may have queries during the due diligence process. Answer these questions honestly and provide any supporting documentation.
A good advisor will be familiar with the due diligence requirements for different CBI programs and can help you gather the necessary documentation in compliance with the government’s requirement.
The process can be time-consuming and may take months. Enhanced checks may be imposed, so it may take some time to get a decision.
