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Henley & Partners, the U.K.-based consultancy, has become the most prominent facilitator of so-called “golden passport” and “golden visa” schemes for the ultra-rich after decades of securing passports for the wealthy in Russia, India, China and more. Now it’s turning to the U.S. as its next major market, boasting an unprecedented uptick in the number of high net worth Americans seeking second citizenship.
Migration investment schemes, which effectively allow people to purchase citizenship or residency in exchange for an investment in a country, have long been controversial but came under a harsh new light after Russia’s February 2022 invasion of Ukraine. Forbes found that nearly half of 35 sanctioned billionaires had a second (or even third) passport, including through European investment migration schemes. Many of the most prominent citizens by investment schemes have since moved to halt sales to Russian applicants, revoke passports or shut down altogether—including most recently Ireland, which announced abruptly on Tuesday it was shutting down its decades-old scheme. Portugal’s program, which has been one of the most lucrative for Henley & Partners, is currently being reviewed by its government.
Despite the crackdowns in Europe, Henley & Partners says business is better than ever—and not for the reasons many may expect. On Wednesday, at a glitzy private luncheon at the Lotte New York Palace, a five-star hotel in Manhattan, the firm’s leaders, including CEO Juerg Steffen, touted the record number of inquiries and applications received by Henley & Partners in 2022, with the highest number coming from a somewhat surprising market—the U.S.—which Steffen claims is about 20% of the firm’s citizenship investment business in 2022, followed by India.
Overall, Henley & Partners’ business grew 25% last year, and another 35% the year before, Steffen told Forbes in an interview before the event. The company would not share revenues for “competitive reasons” but it takes a cut out of every visa or citizenship application, with higher charges for applications with multiple people (70% of applicants are families). The migration firm also runs a government consultancy business advising countries on how to start and run investment migration programs, which Stefan said makes up about one third of the group’s total business. The firm says it helped set up “many” of the 30 residence and/or citizenship programs it facilitates, such as St. Kitts & Nevis, which it helped relaunch starting in 2006. Steffen claims the investment migration industry is now worth some $30 billion, including the amount invested, though others have pegged it closer to $3 billion.
According to a “USA Wealth Report” published in conjunction with the event, the number of Americans making inquiries to Henley & Partners about citizenship investment and residency options has increased more than four fold since 2019 (the company did not share exact numbers for either data point). The firm claimed it received more inquiries from wealthy Americans than any other nationality last year. That includes Russians and Chinese, though the former is likely explained by many of these programs halting Russian applicants, and the latter by China’s strict coronavirus-related travel restrictions; Steffen said there has been an uptick in interest from wealthy Chinese since the country’s borders reopened in January.
To accommodate the new levels of interest, Henley & Partners announced the opening of three U.S, offices in New York, Los Angeles and Miami. Steffen also said the company is planning to expand its workforce from 300 to 400 people by the end of the year. Previously, the company’s office in Canada handled all inquiries from Americans. One employee of the newly formed New York office said it is already working with 200 clients.
As for why wealthy Americans would be interested in getting another passport, Steffen claims that a number of U.S. billionaires started approaching Henley & Partners after the start of the Covid-19 pandemic. “From our perspective it has probably to do with the political environment but also how the government handled Covid at the beginning. They realized, we have a private jet but we can’t just leave and go to another country even if it’s perhaps more secure. Then they realized how important it is to have more than one residence and citizenship,” he said.
But the U.S. is politically and economically stable relative to some of the countries where Americans are reportedly seeking access. According to the report, the most sought after programs among Americans were Portugal’s Golden Residence Permit Program, which requires a minimum real estate investment of nearly $300,000 and can take up to 18 months to process, followed by Malta’s, a program that requires its applicants to live in the country for 36 months and make a minimum investment of about $790,000. Also commonly pursued was Caribbean citizenship through St. Kitts & Nevis, which requires a significantly smaller $125,000 investment and can take less than half a year, according to the firm.
Critics have long pointed to the schemes as a vessel for potential corruption, money laundering and tax avoidance. “We consider that the sale of citizenship through ‘golden passports’ is illegal under EU law and poses serious risks to our security,” Didier Reynders, the European Commission’s commissioner for justice and consumers, said last March as the commission escalated its campaign against citizenship by investment schemes by calling an end to the programs.
In an April 2022 interview with Forbes, ” Eka Rostomashavili of the anti-corruption watchdog Transparency International acknowledged that while there are “legitimate reasons for wanting to have a second passport,” she argued. Many wealthy Russians sanctioned for their connections to the Kremlin have EU passports “because they probably don’t want to live in the mess that they helped create.”
As the biggest player in the investment migration industry, Henley & Partners has landed in the hot seat more than once in recent years after a slew of reports raised questions about some of people it has helped get passports. The Organized Crime and Corruption Reporting Project (OCCRP) published a report in March 2022 detailing how the firm helped a “bevy of high-risk clients” gain citizenship, including some individuals with questionable backgrounds who were later sanctioned or convicted of crimes.
Henley & Partners has repeatedly responded to these allegations asserting it follows all local and international laws and regulations. In his interview with Forbes, Steffen echoed these points, saying that while the industry is largely unregulated, Henley & Partners follows an extensive due diligence process that involves looking at a person’s criminal record from everywhere they’ve lived in the past 10 years and consulting with external investigative companies that write reports ranging from 30 to 70 pages on each potential client. “For us, it’s of course, very important from a reputational perspective,” said Steffen. He said that it took a year to move through all the regulatory hurdles required to start its business in the U.S.
Whether the demand is as high as it claims, moving into the U.S. market seems to offer another important benefit to Henley & Partners, which is a shot at building legitimacy for an industry that has been delivered significant blows over the past year. Steffen says he isn’t worried. While some programs have tightened their application criteria or even closed, he said the firm has been conversing with many new governments open to launching programs. “It’s getting mainstream and most of the countries actually have these programs now,” said Steffen.