Moneyval has warned Cyprus that its golden visas and European Union passports scheme can lead to corruption, money laundering and other criminal activities in the country.
Cyprus has granted more than 3000 golden visas to wealthy foreigners since 2013. It is reported that a minimum €2 million investment can get an investor a passport and instant visa-free travel across the European Union, including Cyprus. Cyprus is a member of the European Union.
Moneyval is the committee of experts from the European council who foucs on evaluation of anti-money laundering and terrorism financing. The agency in its report said that the chance of vulnerabilities had dramatically increased with the Cyprus Investment Programme. These risks have not been mitigated fully, according to the report.
According to the Moneyval report, the total amount invested under the scheme was $7.25 billion between 2013 and 2018. Last November, Cyprus said it would strictly review the processes that helps to grant citizenships.
Despite Cyprus’ advanced measures against money laundering (AML) and financing of terrorism (CFT), there are shortcomings challenging the Cypriot AML/CFT regime, observed Moneyval report.
It appears that real estate is one of the main sources of money for launderers. The real estate sector is usually subject to limited supervision, according to a European Parliament research note issued last year. Moneyval asked Cyprus to further introduce preventive measures in the real estate sector to curb criminal activities in the country.