Why due diligence is central to Malta’s citizenship by investment agency | European CEO

Why due diligence is central to Malta’s citizenship by investment agency | European CEO


European CEO: Founded in 2014, Malta’s Individual
Investor Programme was the first to be recognised by the EU, creating a convenient and efficient
route to European citizenship for international investors. Since 2018 the programme has been administered
by the Malta Individual Investor Programme Agency; its CEO, Jonathan Cardona, joins me
now. Tell me more about Malta’s Individual Investor
Programme; what does it offer to investors and to Malta? Jonathan Cardona: So, Malta’s a small island,
with limited resources. And the idea of the government was to attract
as much as possible, new talent, entrepreneurs, who can bring new investment and foreign direct
investment on the island. The main thrust of what Malta can offer: it’s
a European jurisdiction, ultimately. It’s a very safe, stable, growing economy. And it can be easily considered as a second
home for many people who are seeking to have a second base for their family. To Malta it has offered a number of benefits. The programme is based on a contribution,
so there’s direct cash input into our economy. Apart from that, there’s economic activity
generated by the individuals who come, because they need to purchase property, they need
local services, healthcare, education. Over and above that, a number of these individuals
over time have invested on the island. And I think that’s the best part of the whole
programme: seeing real investment which before was not there. European CEO: Citizenship by investment has
become very competitive in recent years; how has Malta’s programme evolved? Jonathan Cardona: Our work is two-pronged. First we have to promote the programme, so,
we need to ensure that it is on the map of the people who are seeking a second citizenship
out there. But by far the bulk is risk assessment and
due diligence. We need to ensure that we take the right approach,
make the proper analysis of the individuals who are coming over, and take a decision on
that. Due diligence has become, I think, the most
crucial part of our programme. We have implemented a four tier system: The first step is that we go to the police
authorities, which in turn they go to their international counterparts, to ensure that
the persons are who they say they are, and that there are no international issues with
them. Secondly, we check the application for correctness
and completeness. So there are internal checks to ensure that
all the documents tally; the story actually builds up. Then the third one is, we have a number of
service providers which help us bring information from proprietary databases, from intelligence
on the ground. And the fourth tier is, when we collect all
that information with in-house intelligence, we build the picture of the family which has
applied. And on that we build a discussion. After four years we’ve built a lot of experience. We have modified and fine-tuned and implemented
new procedures to ensure the right checks and balances within our system. It’s not a foolproof system, because risk
analysis is a mix between art and science. At the end we have quite a few rejections
as well; so we do reject between 20 and 25 percent of the people who apply. But I think that is the strength of our programme. European CEO: And what does the future hold
for the citizenship by investment industry; and for Malta’s programme in particular? Jonathan Cardona: I think the most important
thing – and something that Malta has been really advocating for – is more collaboration
between the different jurisdictions that have these programmes. All of us do due diligence, all of us have
checks, all of us identify the rotten apple. And I think what is important for the sustainability
and strength of these programmes is that they share this information. In a secure and a legal way – but I think
that’s important. Having said that, I think that the market
is growing. Globally more people are becoming rich. More people need mobility. And it’s becoming more mainstream ultimately. So, the numbers are growing – both from
the supply side and the demand side. It’s just ensuring that good governance is
there – something that Malta continues to promote, and that the right regulations, the
right approach, should be established. European CEO: Jonathan, thank you very much. Jonathan Cardona: Thank you. Thanks for watching. Learn more at iip.gov.mt. Click for more videos about business travel,
and please subscribe for the latest business, finance, and strategy insights from europeanceo.com

Leave a Reply

Your email address will not be published. Required fields are marked *