On Tuesday 22nd May 2018, the Individual Investor Programme organised a conference on the Customer Due Diligence processes required in applying for Citizenship by Investment. The conference tackled various aspects of the application process to obtain Maltese citizenship and a Maltese passport.

The conference was addressed by a number of local and foreign highly experienced practitioners including Mr. Thomas Anthony, Global Head of Exiger’s Immigration, Citizenship and Visa practice who focused on structured and unstructured data, the limitations of relying on Curated Databases and Search Engines which are not primarily built to deal with due diligence purposes and the solutions for such constituting of Supervised Machine Learning, Natural Language Processing and lastly Artificial Intelligence, as the best solution for the near future, which reads, understands, interprets risks and interprets unstructured data in real time.

Mr. Colin Tansley, Founder and Director of Intelect Solutions Limited highlighted protection, reputation and crime as some of the main reasons as to why Customer Due Diligence is conducted. The threats to Customer Due Diligence, or rather the “scars” to this process would be research, credibility and analysis of the results, record keeping, and security since online research conducted leaves a massive footprint.

Mr Andrea Mainardi, Head of Enhanced Due Diligence activities at Thomson Reuters, followed by addressing the High and Low Risks and Mr Yakof Agius, Chief Officer Risk and Compliance at the Individual Investor Programme put forward a ‘Risk Matrix’ for;

  • Identification verification
  • Business and corporate affiliation
  • Politically Exposed Persons sanctions watchlists
  • Sources of Funds/Wealth
  • Reputation adverse media
  • Close network and society
  • Legal and regulatory
  • Impact radius

This was contrasted by a group of panelists, including Mr Miguel Borg, Ms Maruska Buttigieg Gili and Mr Alfred Zammit, who discussed the Due Diligence processes undertaken by banks as opposed to the Individual Investor Programme Customer Due Diligence process and described the latter as a more rigorous one.

Mr Bruno L’ecuyer, first Chief Executive of the Investment Migration Council focused on Due Diligence Best Practices in the Industry as being one which is very susceptible to criticism. He advised that informing applicants that their applications will be subjected to rigorous scrutiny would be the first step which would also send a message that only law-abiding citizens will be accepted to join the Program. “We live in a global community and there isn’t a single country which has capacity to stop evils like terrorism so countries must cooperate with each other and we recommend that all jurisdictions should submit applicants’ names and other pertinent information to regional and international governmental departments; this is critical to maintain credibility in the country” – hence the requirement for Internal Screening, both at a Domestic and at an International level. Record keeping was once more encouraged in order to achieve consistency in the decision-making process and adherence to good due diligence. Record keeping has also served as an insurance policy for both countries and practitioners. Mr L’ecuyer delved into the Due Diligence from the Applicant’s perspective explaining that individuals are also very cautious of where they invest their money. An investor wants to invest in countries with transparent governments, and transparent government systems and with robust due diligence processes. A country must be able to attract highly qualified individuals on an ongoing basis. Countries face critical reputational and financial consequences if unable to provide documenting proof that due diligence practices have been applied. Therefore, countries with Individual Investor Programmes need to show that they have strong procedures in place to guarantee that they can deter undesirable investors and at the same time attract the very best high net worth individuals, their families and their businesses to relocate.

Ms Laura Austin, addressed threats and challenges to the Industry including the General Data Privacy Regulation (GDPR), access to information in worn-torn countries, applicant demographics, confidentiality versus transparency matters and lack of due diligence standards. Ms Austin explained that the solutions to these challenges are good governance, transparency and consistency, the creation of universal standards and most notably continuous monitoring in order to create a reputable due diligence process.

Mr Saviour Cachia, the Information and Data Protection Commissioner gave further insight to the challenge posed by the GDPR to this sector and the reasons for change due to global rapid technological developments. He described the Regulation as being an “evolution and not a revolution” to National Law.

GTG Advocates has been appointed as one of the accredited persons by Identity Malta and is authorised to apply on behalf of third country nationals interested in the IIP. GTG Advocates can therefore provide you with all the assistance required in order to apply for the Maltese Citizenship Programme.

 For more information or if you have any questions on the Individual Investor Programme, please feel free to contact Dr Cherise Abela Grech on cabelagrech@gtgadvocates.com and Dr Maria Attard on mattard@gtgadvocates.com.

Disclaimer: This article is not intended to impart legal advice and readers are asked to seek verification of statements made before acting on them

Disclaimer This article is not intended to impart legal advice and readers are asked to seek verification of statements made before acting on them.
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