Malta still selling golden passports to rich stay-away ‘residents’

The Maltese government continues to sell citizenship to multimillionaires who have minimal genuine links to the country, a Guardian undercover investigation has revealed.

Rich applicants are signing €1m deals in return for Maltese passports after a 12-month qualifying period, secret filming suggests, in news that will further alarm Brussels after this week’s leak of documents from one of the world’s largest passport brokerage firms.

The cache of emails and documents from Henley & Partners data, which was obtained by the Daphne Caruana Galizia Foundation and shared with the Guardian and other media outlets, revealed how wealthy Russians, Chinese and Saudis have been jetting to Malta to secure so-called “golden passports”.

Many were found to be renting apartments to claim they were “resident” but then leaving the properties empty.

In order to establish whether the practices revealed in the leak continued, a Guardian undercover journalist posed in March as an adviser to a multimillionaire Russian industrialist who wished to buy Maltese citizenship for himself and his family.

In a video meeting with two Henley executives including Dominic Volek, the group head of private clients and a member of the firm’s executive committee, the reporter was told how:

• Wealthy Malta passport applicants are expected to spend just three weeks in the country, which the firm said was considered sufficient by the Maltese government to demonstrate a “genuine link” to Malta and to gain citizenship.

• H&P clients tend to establish only the “bare minimum” of Malta links in order to gain a passport.

• Some clients never use their rental properties, even when on rare visits to Malta. Volek said: “Look, to be honest, a lot of the clients also end up staying in hotels because they don’t want to clean up and make meals.”

Volek added: “[To] the clients we say do the bare minimum. And we say the minimum because even under the original programme … there is no regulation that states how much time.”

He continued: “What happens during the 12 months is the main applicant and his wife will have to spend at least three weeks in Malta. It’s not 12 months resident where they are physically in Malta for the 12 months.

“But in order to establish genuine links to the country, the government does want any adult applicants to spend at least three weeks in Malta. That can be done in one visit – so when we do the resident’s application at the start, adult applicants have to go there to give their biometrics. Some of our clients go at that initial visit and just spend their three weeks and they exit and they come back later to collect the passport.”

Henley explained that further links to Malta could be established by joining a gym, subscribing to a mobile phone service or donating to a local charity, and that both the firm and the Maltese state would conduct due diligence on applicants.

A spokesperson said: “Nothing contained in Dominic Volek’s comments is unethical, procedurally inaccurate or contrary to the laws and regulations of Malta. There is no legal basis in EU law to determine what ‘links’ a prospective applicant for citizenship must establish to be considered for citizenship in any member state of the EU; as a matter of EU law, this is entirely up to the individual EU member state.”

The company also provided documents to the undercover reporter stating that for €888,000 (£770,000), applicants could gain a Maltese passport after about 12 months.

The charges included a €750,000 investment in Malta; leasing a Maltese property with an annual rental of at least €16,000 for the qualification year, and then for a further five years after “swearing the oath of allegiance”; and a donation of at least €10,000 to a “registered sport, cultural, scientific, philanthropic, animal welfare or artistic non-governmental organisation or society”.

Combined with Henley’s fees of more than €100,000, plus other costs associated with the application, the total quote for a family of two adults and two children came to €1.2m.

The revelation that Malta continues to sell so-called “golden passports” to applicants with minimal genuine links to the country will also raise concerns among anti-corruption campaigners, who have long feared that the schemes are attractive to criminals and kleptocrats from repressive regimes as they give full access to the EU.

In October the European commission launched infringement procedures against Cyprus and Malta by issuing letters of formal notice regarding their investor citizenship schemes. The commission accused Malta of selling European citizenship to individuals with no genuine connection to the country.

A spokesperson for Malta said any suggestion that the 12-month residency requirement was a “sham” was “factually incorrect”.

He said: “The granting of citizenship is the competency of the individual state. Applicants seeking to invest in Malta are issued with a residence permit whilst they are in Malta. This is a process that involves Interpol and Europol database checks, border controls and physical presence in Malta.”