Golden Visa for Sale! Now on special offer for the 1%

European passports and Schengen visas are the most desired traveling documents in the world. Not only do they grant the most traveling freedom, they give access to a safe and stable living environment, with free speech, in a market that can fulfill all your needs.

Many EU countries have taken advantage of this by offering entry in exchange for investment. This kind of activity is commonly referred to as a Golden Visa Program. For the subject countries, they are indeed golden, because they have the potential to bring in billions of capital into the country. Latvia, for example, used the program to stabilize its economy after the financial crisis.

According Transparency International, such programs have been in existence since the 1980s, and currently at least 12 EU Member States are offering them. Usually the reward is a residence permit, however Cyprus and Malta offer a fast track to citizenship should the customer invest enough money, and Portugal offers the citizenship option after a six year waiting period.

While the controls in most European countries should prevent individuals who are sanctioned by the EU from obtaining citizenship, many individuals took advantage of Golden Visa programs prior to implementation of the current international sanctions. It is a complicated matter for a nation to try to implement sanctions on its own citizens and capital that is invested within the country.

Most of these programs are legitimate, but the way they are set up invites abuse. Real estate is one of the easiest ways to launder dirty money, and these programs are taken advantage of all over the place.  

Some of the Golden Visa and Golden Passport programs are complex and might involve long red tapes and waiting periods. Of course, sometimes a suitable facilitation payment can fix that…

Latvia Golden Visa Program

The Latvian Golden Visa Scheme was heavily criticized. From 2010 to 2014, Latvia offered it at a discount price of EUR 71,150 if invested in countryside real-estate. The price for living in Riga was doubled to a value of EUR 142,300. As you can see, this could very easily be taken advantage of by someone looking to spend dirty money.

The number of people who took up this offer increased substantially  in 2014, the same year that Russia annexed Crimea. Almost 90% of the visa applicants came from Russia and countries that were formerly in the Soviet Union.  Thus, a program that had originally been intended for economic development and brought wealth to Latvia in the previous years had become embroiled in political significance.GV-by-Year

Picture 1: Latvian Golden Visas per year (Source)

The negative effects of the program eventually convinced the Latvian Administration to dismantle the discount in 2014. The greatest risk of these visa programs was spying, according to the deputy head of the Latvian Security Police in a 2017 parliamentary committee hearing. Then, of course, there was the risk to the economy, since many applicants were unable to prove the legality of their money. Although the program has since been dismantled, the effects of it and risks introduced by it will be felt for years to come.

Hungarian Golden Visa Program

Another interesting notorious golden visa program was the one in Hungary.

The Hungarian Golden Visa program was slightly different than in Latvia. Instead of it being based on investment in real estate, applicants had to buy a state bond from one of eight companies that had solitary rights to sell them on the behalf of the government. These bonds, which totaled up to EUR 300 000, were not inexpensive.

The results of this program were remarkable. The eight companies were able to earn about USD 600 million – and that’s a conservative estimate – over the course of the years that this program was running from 2013 to 2017. (OCCRP May 16, 2018)

The program ended in 2017 after criticism concerning the integrity of the eight bondseller companies. They were pretty mysterious – most were registered in offshore tax havens and it wasn’t completely clear who exactly profited from the sales.  

An investigation conducted by g7.hu and Transparency International Hungary uncovered the way these companies worked. Basically, companies would be assigned to territories around the world and allowed monopolies to sell the bonds under the program. But the way these companies were assigned required inside knowledge and connections – it wasn’t like it was a public tender. They had to have known about it separately since it was never advertised. Per the law, all the applicants were meant to be listed on the Hungarian Economic Committee’s agenda, but this was not always the case.

Although the Golden Visa program in Hungary has since been shut down, there are some rumors that a new ‘golden’ immigration program may be coming. Direkt36 reported that this new program was advertised by a Hong Kong based company on the Chinese platform WeChat. This new program now more closely resembles Latvia’s program, where applicants are required to invest a value of EUR 78 000 into Hungarian real estate.

Case Study: Who buys the visas? 

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Picture 2: Screenshot of Mr. Bogolyubov from The Times

Mr. Gennadiy Bogolyubov, the Cypriot, the Israeli, the Brit, the Ukrainian

Main Source: EveningStandard 11 Sep 2018

Mr. Gennadiy Bogolyubov is a popular face in the oligarch edition of the Bold and the Beautiful. He and his business partner, Mr. Igor Kolomoisky, are some of the best customers for UK lawyers – the costs alone for the litigation with their rival Mr. Viktor Pinchuk was estimated to be over GBP 50 million. The allegations and adverse reputation of the duo include alleged murders, violent takeovers and other accusations of mafia-style activities.

The two partners were very successful in post-Soviet era privatizations. Allegedly, the hasty privatization of a national bank in Ukraine to PrivatBank enabled the duo and their associates to empty out the bank’s capitalization with a decade long fraudulent loan scam.

To protect taxpayers’ interest and due to demands from Ukraine government’s external financiers (i.e. USA) PrivatBank was re-nationalized in 2016. “When Ukraine’s finance minister went to oversee the nationalization of the country’s biggest bank in December 2016, he took with him a team of bankers—and a security detail of special-forces operatives” (Wsj.com April 6, 2018).

Amongst Mr. Bogolyubov’s hobbies are philanthropy, which he practices through Bogolyubov Foundation.

Golden Visa United Kingdom Tier 1 Investor Visa (2009)

Cyprus Golden Citizenship (2016)

Nationalities Ukraine, Cyprus, Israel, United Kingdom
Current Residence Switzerland
Net Worth Unknown, was Ukraine’s #3 richest in 2010 (Kievpost)
Frozen Assets At least USD 2.6 Billion, shared with Mr. Igor Kolomoisky
Costs to Ukrainian Taxpayers USD 6 Billion to recapitalize Privatbank
Close Business Partner Mr. Igor Kolomoisky, who, according to a quote from the British Court, has taken over companies “at gunpoint” in Ukraine. Mr. Kolomoisky is a former governor and listed as an inactive PEP (Politically Exposed Person) per Dow Jones
Other Associates Mr. Alexander Zhukov, father of Roman Abramovich’s girlfriend
Powerful Enemies Mr. Viktor Pinchuk
London Real Estate GBP 62.5 Million home

GBP 20 Million house

Eaton Place Mansion

GBP 173 Million office block

Table 1. Mr. Gennadiy Bogolyubov’s Connections

This article was co-written by Oskar Savolainen and Kristina Weber of Centry Ltd. For more content like this, be sure to subscribe to Centry Blog for articles related to the security and risk industries.

Safe Online Dating

My Post

Online dating is a great way to connect with people. Throughout the history of the internet, it has gotten better and better. Most millennials meet their partner online compared to other ways of meeting new people. It’s quicker and easier than ever, where a date with a new person can be arranged within an hour’s notice through your smartphone.

How We Can Help

Despite the concerns that may be raised with some of the risk-related content in the article, online dating overall isn’t a bad thing nor is it something to fear. You can be immensely rewarded and fulfilled by it, and many happily married couples have their origins online. The only thing is, that you have to educate yourself on the environment. Dating online has a different range of risk factors than, say, meeting someone at a nightclub, but just like monitoring your drink in that example, there are steps you can take to avoid being taken advantage of.

We at Centry have been inspired to help people like you after hearing so many stories of online dating gone wrong. We believe you can find something real if you go about it mindfully. So, we are happy to announce that we have opened up an identity verification service called Date Check Online that provides three different levels of private checks to make sure that the person you are talking to is who they say they are. These checks are performed by investigative professionals who have been trained to spot red flags and have data sources available to them to search names against known sex offender registries and watchlists, so it’s a smart way to support your initial Facebook sleuthing if you have a funny feeling about someone.

The Risks

New technologies and phenomena often bring with them concerns that need to be addressed. With the ease of availability comes volume, and, as in any kind of risk management, with increased volume comes increased risk. Online dating can be immensely rewarding, but it should be conducted responsibly; individuals should be aware of their personal safety concerns and online dating risks should be managed accordingly.

Misrepresentation and Catfishing

Misrepresentation is always a risk with online dating, whether it’s something like hiding the fact that someone is married or using a photo on the profile that doesn’t accurately reflect their appearance. It’s so easy to lie behind a digital barrier that you never really know who the person is that you are talking to until you meet them, and even then there could be facts that haven’t been disclosed.

When misrepresentation is deliberate to the point of falsifying an identity, it’s called Catfishing.

It’s a term that refers to situations where someone has been involved in an online romance under the guise of a fake persona. Oftentimes these people will take images of attractive men or women from Google Image Search, come up with a fake name, and create life stories for these personas in order to take advantage of the people who fall for them.

We have all heard of the horror stories of grown  men using these fake personas to take advantage of young girls, but this concept exists across all genders and can affect anyone.

At best these circumstances result in broken hearts and feelings of betrayal when the lie is discovered, but they could also cost you your life savings. Huffington Post reported on a 69 year old woman in Florida who spent two years in a relationship with an individual that ultimately ended up abusing her trust to make money. Over the years of their relationship and phone calls and texts, she had funneled him roughly 1 million USD for the purpose of what she believed was to help him run his business.

Action Fraud reported that targets of romantic fraud lost approximately 41 million GBP in 2017. This number is likely also only the tip of the iceberg, especially considering that it can be humiliating to be taken advantage of in such a way, which can discourage victims from coming forward about their experiences.

Greater Risks for Women

The risks with online dating are greater for women, considering worst case scenarios such as physical or sexual assault, trafficking, or worse. While things like this can also happen to men, statistics for these crimes are heavily skewed toward female victims and that fact cannot be ignored.

This is all the more difficult considering that a number of dating websites perform no screening whatsoever on people who sign up for it. Which means that registered sex offenders can sign up– and approximately 10% of sex offenders use online dating sites.

Online Dating as a Business Risk

For businesses, online dating is a relevant factor that can affect several risks. It is so prevalent that the odds are that someone around you is participating in it. In your technology reliant workplace, most employees feel it is important to have their smartphones with them all the time, and the honeypot tradition has its roots in a long history of espionage. An online romance is a shortcut vector for red teams to breach your company’s security. Other concerns may elevate risk in business travel: online dating apps have been known to be used to lure victims into situations where they can be easily robbed.

While we think that implementing dating controls to your corporate policies is a bad idea, we urge individuals to think about how your personal communications may have have an effect on your professional security. Business is also a great analogy for online dating: as an entrepreneur you would have to take risks that could have negative outcomes, however, with the right planning, the positive outcomes are much much more likely and the impacts of the negative ones are minimized.

Safety, responsibility and integrity considerations aren’t hindrances – they are success enablers. As we always recommend, trust your instinct, and use resources provided to you.

Feel free to reach out to us on any of our social media platforms or on the Date Check website if you have any questions or comments!

For more content like this, please subscribe to Centry Blog. This article was written by Kristina Weber and Oskar Savolainen of Centry Global.