A controversial “golden passports” scheme run by the Pacific nation of Vanuatu saw more than 2,000 people, including a slew of disgraced business people and individuals sought by police in countries all over the world, purchase citizenship in 2020 – and with it visa-free access to the EU and UK, the Guardian can reveal. Among those granted citizenship through the country’s development support program were a Syrian businessman with US sanctions against his businesses, a suspected North Korean politician, an Italian businessman accused of extorting the Vatican, a former member of a notorious Australian motorcycle gang, and South African brothers accused of a $3.6bn cryptocurrency heist. The passport scheme allows foreign nationals to purchase citizenship for US$130,000 in a process that typically takes just over a month – all without ever setting foot in the country.
Marketed by agencies as one of the fastest, cheapest and most lax “golden passport” schemes anywhere in the world, the development support program grants unfettered, visa-free access to 130 countries including the UK and EU nations. Vanuatu also operates as a tax haven, with no income, corporate or wealth tax. Experts have warned the scheme is ripe for exploitation, creating a back door for access to the EU and UK and allowing transnational criminal syndicates to establish a base in the Pacific, and Vanuatu’s taxation laws make the country an attractive site for money laundering. The passports program, which netted the Vanuatu government more than US$116m last year, has been highly controversial since its relaunch in 2017. But until now, knowledge of who has bought passports through the scheme has been murky. A series of internal government documents obtained by the Guardian via the country’s freedom of information scheme, details the name and nationality of every recipient of a Vanuatu passport through the country’s development support program and Vanuatu contribution program in 2020 and January 2021After a months-long investigation, involving searching publicly available court records, electoral rolls, death records, social media trails, and discussions with police and sources from around the world, the Guardian has been able to confirm the identities of dozens of the individuals on the list. Vanuatu issued roughly 2,200 passports in 2020 through these programs – more than half (around 1,200) were to Chinese nationals. After Chinese, the most common nationality of recipients was Nigerian, Russian, Lebanese, Iranian, Libyan, Syrian and Afghan. Twenty people from the US, six Australians and a handful of people from Europe were also among those who applied. The citizenship-by-investment (CBI) scheme is not illegal and many countries around the world offer CBI programs. There are many legitimate reasons for applying, including improved freedom of movement or tax-free offshore banking privileges.
However, security experts warn that the ease with which people can buy passports from the country, as well as the travel it permits, could make it an attractive scheme for members of transnational criminal syndicates, allowing them a legitimate base in the Pacific.“It’s not just that they can travel through the EU or set up businesses … one of the issues is being able to create these networks to the Pacific, especially as the Pacific becomes more of a trafficking hub for drugs,” said Jose Sousa-Santos, a Pacific policy fellow at the Australian Pacific Security College. “And Vanuatu’s tax semi-haven laws make it very attractive for money laundering.” The Guardian has found that a number of Vanuatu applicants are heavily implicated in a complex web of offshore business, with some owning shell companies with no discernible business activity. In response to these concerns, Ronald Warsal, the chairman of the Vanuatu Citizenship Office and Commission, said: “Vanuatu is a signatory to … most internationally sanctioned treaties and has ratified such treaties in recent years prohibiting transnational criminal syndicates to operate within its jurisdiction and as such, it is hard for international criminal syndicates to establish a base in Vanuatu. Both the EU and the OECD have continued to express concerns regarding due diligence measures, forcing Vanuatu to promise it would step up background checks last year in an attempt to clean up the programs Despite this, the documents show that as recently as January 2021, Vanuatu was selling passports to individuals with links to fraud or sanctions and others who were sought by police in their home countries.
The list presents a list of colourful characters including a FIFA boss, an Emirati princess and a Nigerian televangelist – none of whom the Guardian alleges were involved in any wrongdoing or criminal activity. The Guardian also identified Libya’s former UN-backed prime minister Fayez al-Sarraj. Sarraj is just one of a number of prominent political figures who purchased Vanuatu citizenship. As Libyan ceasefire agreements broke down in January 2020, Sarraj obtained passports for him and his family – applied for under his wife’s name. After resigning in March of this year, he has since reportedly left Libya. There is no suggestion by the Guardian that Sarraj or his wife have been involved in any wrongdoing or criminal activity, or did anything improper in buying a Vanuatu passport. Vanuatu is one of the poorest countries in the world, with the World Bank putting GDP per capita at US$2,780. The country is heavily in debt, in large part due to the natural disasters that have hit it. After a crippling cyclone in 2014, the country’s debt stock-to-GDP ratio climbed from 23% to 47% in 2018. The sale of passports is the largest source of revenue for the Vanuatu government, with analysis by Investment Migration Insider finding it accounted for 42% of all government revenue in 2020. In June 2021, the government reported a budget surplus despite the Covid-19 pandemic, largely thanks to the continued demand for citizenship, and the government has used the profits to pay down debts.
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