The Institute of Certified Public Accountants of Cyprus, (ICPAC) the professional association for accountants in the Republic of Cyprus, has issued an Advisory to its members, warning them that applicants for CBI passports are to be considered high-risk clients, and specifically calling for an increased level of accountant scrutiny upon such individuals. The ICPAC document goes on to state that Citizenship by Investment, by definition, carry a risk of legalizing money coming from corruption, money laundering and tax evasion, due to the nature of the applicant group that they attract, high-risk individuals.
The advisory goes on to note:
(1) The source of an applicant's wealth, and his finds, must be verified by audit, and in the event that citizenship is refused by regulators, the reasons should be substantiated and addressed.
(2) The purpose of these guidelines is to insure that anti-money laundering legislation is not circumvented when CBI services are provided to applicants.
(3) Particular attention should be paid to addressing all risks of possible money laundering, as well as reputational issues associated with the CBI program.
(4) Uniform Due Diligence checks should be performed when accounting services related to CBI are provided, whether to new or existing clients.
(5) Members must ascertain whether the applicant has participated in any other Citizenship by Investment (CBI/CIP) programs in other jurisdictions.
(6) Members should check the framework behind the applicant's CBI investment, to confirm that it will actually assist in improving the overall national economy.
These guidelines, while directed to accountants in Cyprus, provide a roadmap for any professional whose clients have applied for Citizenship by Investment passports in any jurisdiction.