Despite scandal, former administration defends management of CBI programme

In a recent sitting of Parliament, the Government of National Unity brought an amendment to the St. Christopher and Nevis Citizenship Act in its attempt to address “lax controls” in the programme. Prime Minister Dr. Timothy Harris tabled the amendment in Parliament on July 29. The amendment gives the prime minister greater oversight of the CBI programme with respect to applicants.

“A person shall be excluded from the application for registration as a citizen pursuant to sub-section 5 if the person is a national of a country prescribed by the minister by an order subject to negative resolution of the National Assembly where the minister is satisfied that one, there are reasonable grounds in the interest of defense, in the interest of public order for the exclusion or to various nationals of the country that have been engaged in activities prohibited under The Proceeds of Crime Act, The Ant-Terrorism Act and such other acts, regulations, codes, or guidelines relating to terrorism, money laundering or the financing of terrorism,” Dr. Harris said.

In his debate on the St. Christopher and Nevis Citizenship Amendment Bill, Senator Carty said that the CBI programme of St. Kitts and Nevis had only garnered the attention of developed countries such as the United States of America and Canada because of the voluminous applications to the programme and that “up to this time there has not been one person who has passed through our programme who has been found to be associated with terrorism or any of those things…we are not aware that that has happened.”

“Part of the problem Mr. Speaker that I believe that we have had was directly related to the fact that the programme had too many applicants. Because, I am convinced in my own conversations, in my own understanding of what was transpiring at the time, Mr. Speaker, that whatever we had, if the numbers coming into the programme weren’t what they were, there would hardly have been any problem at all because whenever we spoke to persons who had issues that they were citing in relation to the programme, they seem to be citing the issue of the numbers and so we recognize that they had a challenge with that,” Carty said.

However, a FinCEN (The Financial Crimes Enforcement Network) advisory issued May 20, 2014, to financial institutions with the subject “Abuse of the Citizenship-by-Investment Program Sponsored by the Federation of St. Kitts and Nevis” stated that certain foreign individuals are abusing the Citizenship-by-Investment program sponsored by the Federation of St. Kitts and Nevis (SKN) to obtain SKN passports for the purpose of engaging in illicit financial activity.” The advisory recommended that “financial institutions can mitigate exposure to such risk through customer due diligence, including risk-based identity verification consistent with existing customer identification program requirements.”

The advisory also stated that “FinCEN believes that illicit actors are abusing this program to acquire SKN citizenship in order to mask their identity and geographic background for the purpose of evading U.S. or international sanctions or engaging in other financial crime.”

FinCEN particularly targeted Iranian nationals asserting that “the SKN program is attractive to illicit actors because the program, as administered, maintains lax controls as to who may be granted citizenship.”  The advisory also specified that although the former Douglas Administration had vowed to suspend Iranians from the programme in 2013 they were not convinced that this had been done and that Iranians continued to gain access to the SKN passports through the CBI programme. Since 2012, the former Douglas Administration had removed the area specifying country of origin in the SKN passports but had to replace it after grievous concerns. All passports issued after 2012 had to be recalled.

In his response to the United States, Senator Carty implied that the playing field was not level.

“At times Mr. Speaker, you do think that people are trying to push you over and that we are a sovereign nation and so forth, but as you live with other nations, as you recognize your small size, you’re going to have to recognize that you’re going to have to compromise and that you’re not going to be in a position to ask for reciprocity,” Carty said. “You can’t ask them well since you’re asking us for our files well give us your files too…that’s part of the problem that we had, that they were making demands that we thought, albeit, the genuineness of their concerns, were getting to a point where you thought there wasn’t going to be a point where they would stop making additional demands and moving the goalpost along.”

When it came to light that there were concerns with some Iranians abusing St. Kitts and Nevis citizenship, former Prime Minister Dr. Denzil Douglas, gave an address to the nation in which he issued a suspension to all Iranians living in Iran from the St. Kitts and Nevis CBI programme. At that time, the only reason that Dr. Douglas gave for this move was that the integrity of the CBI programme must be ensured.

Again, on July 29, 2013, Dr. Douglas suspended all Iranians living within and without Iran, along with all Afghanis from the programme. By then, Canada had suspended diplomatic relations with Iran, branding it as one of the greatest “threats to global peace and security.” Dr. Douglas agreed with Canada’s decision at the time.

But the problems did not stop there. On November 22, 2014, Canada imposed a visa required on citizens of St. Kitts and Nevis entering its borders. A press release issued by the Canadian High Commission in Barbados stated that Canada was implementing the visa requirement “due to concerns about the issuance of passports and identity management practices with its citizenship by investment program.”

“Canada is acting to protect the safety and security of Canadians and the integrity of the Canadian immigration system. The visa requirement will ensure that Canada will be able to properly determine the true identity of St Kitts and Nevis passport holders and to deny entry to those who would otherwise be inadmissible to Canada,” the release said. 

Additionally, a letter dated January 9, 2015, unbeknownst to the country, was sent to Dr. Douglas by John Kerry, the United States Secretary of State, which challenged him to clean up the CBI programme and warned him that if such was not done, they could take action.

“As a member of the Cabinet, I can tell you that we did take a decision administratively to deal with a prevention of Iranians getting into the programme. However, we have had applications in the system that had been processed for which people had already paid all fees and we thought that there was a commitment on our part to follow through with that and at the same time it appeared as though that while the US Government was expecting us (to suspend all Iranians), our side didn’t really understand that they were saying that even those that were already in the system, those that had been approved,” Carty said.

“America had it differently,” he said.


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