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Economy

Cyprus Tightens Rules for Passport-for-Cash Scheme

NICOSIA — Cyprus says it is introducing tougher anti-money laundering checks in its "golden passports" program, under which it gives citizenship to foreigners who invest large sums in the east Mediterranean country.

Interior Minister Nicos Nouris said Wednesday that the government is following through on a pledge to beef up eligibility criteria in the so-called 'golden passport' investment program, which has brought in billions in revenue since its introduction following a 2013 financial crisis.

He said the anti-money laundering rules will be used to bolster the vetting of prospective investors. The new rules will come into force after parliamentary approval.

A new clause will make it easier for investors who are either involved in or have been convicted of a serious crime to have their Cypriot citizenship revoked.

Investors will still need to sink 2 million euros ($2.28 million) into the Cypriot economy and purchase a 500,000-euro ($569,000) home plus tax.

But Nouris said that under the new rules, investors will have a wider array of investment choices, like buying up stock in Cypriot companies. Investors will also have to pay a 150,000-euro ($170,500) application fee, with the money earmarked for Cyprus' housing and entrepreneurship programs.

"The new regulations no longer leave the program open to ridicule, as some have done in the recent past, and leave no doubt as to its credibility," Nouris said.

The number of citizenships issued in the program will be capped at 700 a year.

The program has attracted many investors because a passport from European Union member Cyprus automatically grants holders citizenship to the 27-member bloc. 

The Cypriot government last year moved to revoke the citizenship of 26 foreign investors from countries including Russia, Cambodia, Malaysia and Iran following reports that they had possibly broken the rules.

Some of those individuals were linked to authoritarian governments or were being sought by authorities over their involvement in large-scale money laundering.

Cypriot President Nicos Anastasiades acknowledged at the time that "errors" may have been made in granting such "golden passports."

Some 4,000 Cypriot passports were issued to investors under the program, generating at least 7 billion euros ($7.96 billion) since 2013.

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