NICOSIA – Three days after being embarrassed on the popular United States TV magazine show 60 Minutes which alleged the country is a cesspool of corruption influenced by Russian oligarchs, Cyprus has yanked nine more passports from a disgraced residency program that ended in 2020.
But no names or reasons were given by the government of outgoing President Nicos Anastasiades – whose family law firm handled applications for the now-ended Citizenship by Investment scheme that gave wealthy foreigners residency and valuable European Union passports. He had recused himself from involvement.
The EU and other critics had charged the program was open to money laundering and provided easy access to criminals trying to hide cash, who weren’t checked, blowing up after media reports about corruption.
The government has refused to reveal any names and Anastasiades, whose 10 years in office will end in February when elections are held, had staunchly defended the program, saying that other countries were even worse.
The decision affects three investors and six of their dependents, bringing the total of revoked passports to 222, with 63 of investors and 159 of their family members, said PhileNews, the old cases still rocking the government.
The scheme was abolished after an undercover investigation by Al Jazeera revealed rampant corruption, government figures and lawyers facilitating passports even for those they were told were criminals.
Rich foreigners were able to acquire a Cypriot passport by investing more than 2 million euros ($2.17 million) in the country and there’s been no accounting of where all the money went.
The TV show focused on Cyprus’ links with Russian oligarchs and featured interviews with Finance Minister Constantinos Petrides, who said the country was being disparaged, and Green Party Parliamentarian Alexandra Attalides.
She said that after the fall of the Soviet Union, Cyprus became a destination for Russian oligarchs to hide their financial assets, due to the island’s low tax rate and no questions being asked.
Transparency International analyst Maira Martini said the financial system on the Greek-Cypriot side of the island – Turks have occupied the northern third since unlawfully invading in 1974 and seizing the territory – was geared to be opaque.
By 2012, Cyprus had amassed bank deposits of nearly 72 billion euros ($77.95 billion) with some 30 percent coming from Russians. The residency permit and passports began being offered after Anastasiades took office in 2013 and asked for a 10-billion euro ($10.83 billion) international bailout.
THE SMELL OF MONEY
That was over the near-failure of Cypriot banks – despite awash in Russian money – for their large holdings in Greek bonds devalued 74 percent during that country’s economic crisis at the time and bad loans to Greek businesses.
Anastasiades then broke a promise and allowed the banks to confiscate 54.5 percent of all accounts of more than 100,000 euros ($108,262) which cut deep into the Russian holdings and devastated small businesses.
He vowed to find out who was accountable for the bank fiasco that nearly collapsed the economy but never did and the government promoted the program that didn’t properly vet applicants for any criminal activity.
From 2013 to 2020, Cyprus issued almost 7,000 of those s0-called “golden passports” – nearly half to Russians, with the island having a large ex-patriate community of them as well and many signs in Russian.
“Suddenly, the skyline of Limassol was injected with high-rise luxury apartments, its port with mega yachts and its stores with uber-wealthy Russians,” CBS noted of a key seaside city.
“You could see them walking around like princesses, moving in the most expensive shops. They have their business, they have their houses, they have luxury houses,” Attalides said..
Finance Minister Constantinos Petrides told CBS that about ten holders of Cypriot passports were sanctioned by the West and that the Council of Ministers has initiated a process to revoke their citizenship. Some also have had their assets frozen, he said, but wouldn’t say who.
When asked by CBS to disclose their names, Petrides refused, citing European data protection rules, the channel said, although some other EU countries have publicized names in their programs.
The channel also asked questions regarding what the government is doing about properties in Cyprus and shell companies that trace back to sanctioned Russians – also not identified nor if they had sway in the government.
“I’m not saying that everybody should trust the Cyprus government. The Cyprus government does not need somebody to trust it. We have the reports of the mutual assessment for Cyprus 2019 that shows all the progress made in the past years. I think that we have proved as Cyprus that we are a reliable member of the, of the EU. We do admit that in the past there have been mistakes. But Cyprus has also been unfairly stigmatized,” Petrides said.