US billionaires are buying a second passport as a ‘plan B’
- The number of wealthy Americans buying “golden passports” has skyrocketed over the past three years.
- The best programs grant citizenship to foreigners who invest millions of dollars in the country.
- US candidates cite COVID, climate change and political division, several companies told Insider.
The number of affluent Americans applying for citizenship or residency in foreign countries has exploded in the past three years as American billionaires, tech entrepreneurs and celebrities seek to create a “plan B” for their families, said several investment migration companies to Insider.
More than a dozen countries offer “golden passports” and visas that allow wealthy foreigners to obtain citizenship or residency in exchange for investing in the country. The most expensive programs range from $1.1 million in Malta to $9.5 million in Austria, according to Forbes.
“We view these programs as an insurance policy,” said Ezzedeen Soleiman, managing partner of Latitude Residency & Citizenship. “Billionaires have approached us and asked us where the best place to live would be if there was a climate catastrophe, or if there was another storm, or another global pandemic.”
Latitude, a company that accompanies high
investors around the world through the application process, said US inquiries increased 300% between 2019 and 2021. Henley & Partners, one of the world’s largest citizenship brokers, has said sales to US nationals increased 327% between 2019 and 2020 and another 10. % in 2021.
According to Dominic Volek, head of private clients at Henley & Partners, there are “four Cs” currently driving the investor citizenship industry: COVID-19, climate change, cryptocurrency and conflict.
The recent surge in the number of U.S. applicants began under the Trump administration and intensified during pandemic shutdowns, he added.
“In the very strict lockdowns, there was a point where if you only had a US passport, you couldn’t enter Europe,” Volek told Insider. “I think it made a lot of particularly wealthy people realize that they are potentially a little more fragile than they thought.”
Reaz Jafri, CEO of Dasein Advisors, said he received more US inquiries in the past three years than in the previous 20 years combined. He said his US clients are often in technology, real estate or crypto, and are worth between $50 billion and $20 billion.
The one thing they all have in common: a deep-rooted fear about the future of American society, he said.
From a tech founder concerned about rising Asian-American hate crimes to young web3 entrepreneurs seeking to avoid tax hikes, Jafri said wealthy clients from all political backgrounds were planning for the worst.
“We’ve all been through the last two and a half years,” Jafri said. “All of this has reminded us of how vulnerable and fragile we are, and people of means are accepting of this happening again – and they don’t want to be caught off guard.”
“Portugal is the next California”
Two of the companies interviewed by Insider said Portugal’s five-year residence permit — which allows visa-free travel to 26 countries in the European Union — is the program most requested by U.S. investors.
Portugal’s “golden visa” requires a minimum investment of just over $200,000 and an average stay of seven days per year in Portugal. When the permit expires, residents can then apply for full-time citizenship, which can take another three years.
“Portugal is the next California,” Soleiman said. “You have enormous talent going there, enormous wealth going there.”
Ultra-wealthy Americans want to establish themselves in Europe as an “inheritance plan” for their children and grandchildren, he added. “A lot of them are either disappointed with what’s happening in the United States or don’t see the opportunities that they once saw in the United States.”
However, many golden passport holders do not end up moving and some rarely visit at all, as a Guardian investigation into Malta’s citizenship scheme revealed last year.
“Very few of our clients actually move,” said Volek of Henley & Partners. “Most of our customers just want the available option.”
The rise in the number of Americans seeking golden passports comes amid fears the schemes have created loopholes for “shady individuals” and “dirty money” to enter the EU.
Peter Spiro, a professor of international law at Temple University and an expert on dual citizenship, told Insider that big companies like Henley & Partners have “a serious interest” in vetting their candidates.
“They’re making a lot of money and they want to keep making a lot of money,” he said. “So they have an incentive that the due diligence element is real. I feel like they’ve done a really good job.”
Volek told Insider that due to a lack of industry regulation, some smaller investor migration firms don’t properly assess applicants.