Wednesday, October 28, 2020

Number of rich foreigners buying UK ‘golden visas’ rises to 5-year high despite rules being tightened

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The numbers of rich foreigners investing at least £2m in the UK in return for a “golden visa” has reached a five-year high.

The Home Office gave 255 people tier 1 investor visas in the first six months of 2019, permitting them to live and work in the UK for five years. This number was the highest in a six-month period since 2014.

The increase happened after former Immigration Minister Caroline Nokes suspended the controversial scheme in December 2018.

There was also a clampdown on the scheme in the aftermath of the Skripal novichok poisoning attack. where Russian applications were in the spotlight.

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She said: “We will not tolerate people who do not play by the rules and seek to abuse the system.”

Later, the Government reversed its decision and kept the scheme in place, but implemented stricter rules from April to address organised crime and money laundering.

High risk but wealthy individuals

The Home Office granted 124 applications in the three months to the end of June; an increase from 91 people in the same period the previous year under more relaxed rules. According to Home Office data, only four applicants had their visas declined, the Guardian reported.

Naomi Hirst, an anti-corruption campaigner at Global Witness commented: “Late last year the UK was poised to suspend these risky and unethical schemes but just nine months later they’ve sold the highest number since 2014, with very few applicants being rejected.”

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“At a time when the EU is moving to crack down on the sale of citizenship and residency, it’s worrying that the UK is once again opening its arms to high risk but wealthy individuals. It opens the question as to whether, post-Brexit, the UK will be looking to pick up the customers that EU member states could be forced to reject.”

After the novichok poisoning attack on Sergei and Yulia Skripal – which the UK Government said was carried out by Russia – the Home Office claimed it would clamp down on the golden visa scheme and review the visas of 700 Russians who arrived in Britain between 2008 and 2015 under the tier 1 scheme.

Around 11,000 people have entered the UK since the golden visa scheme was first introduced in 2008, primarily from Russia and China. One example is Roman Abramovich, the billionaire owner of Chelsea football club, but he secured Israeli citizenship after the UK Government failed to renew his visa the previous year.

The fall in the pound attracts the super rich

Under the new stricter rules applicants must invest almost £2m in British companies, and need to prove they had legitimate access to the funds for almost two years, as opposed to the previous 90 days. They’re eligible for indefinite leave to remain and can apply for citizenship if they maintain their investment for five years.

A spokesman for the Home Office said: “All applications are considered on their individual merits and in line with the immigration rules.

“The tier 1 (investor) route has been reformed to better protect the UK from illegally obtained funds and ensure only genuine and law-abiding investors can secure visas. The reforms also benefit UK companies as the route is now only available to those who invest in UK businesses.”

Anna Harvey, a partner at Price Bailey, a law firm that provides immigration advice, said the increase in applicants was probably due to the fall in the value of the pound, meaning the UK is now a relatively cheap place to move to.

She added: “The Government has taken a tougher approach to tier 1 visas on the basis that they were open to abuse for money laundering. It may be the case that the tougher rules deterred some applicants. In that context these numbers are even more surprising.”

Vikki Wiberg, an immigration lawyer at Taylor Wessing, similarly blamed the fall in the pound for attracting the overseas super rich.

She said: “A lot of investors come to the UK seeking education for their children. They’re looking for education in English, and Brexit isn’t going to change that; what Brexit has done is cause a sharp drop in the pound and that’s made school fees cheaper.”

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