Abrahamian: Americans Are Buying an Escape Plan

Interesting take on the Trump gold card visa and increased hedging of bets among Americans, including exploring citizenship by descent:

…I have been writing about the world of millionaire migration for years. The market depends on a cottage industry of advisers, financial planners, and lawyers who help their clients navigate the paperwork and requirements, and I spoke with some of these experts in the weeks following Trump’s announcement. All seemed to think that only a handful of people would take Trump’s bait—mainly because there simply aren’t enough people rich enough to shell out $5 million with no return on their investment.

Dominic Volek, an executive at the consulting firm Henley & Partners, told me that his clients typically “look at investing 10 percent of their net worth on citizenship or residence.” To consider the gold card, they’d need “a liquid net worth of $50 million, and there are only around 300,000 people globally who have that kind of money.” Even then, gold cards will succeed only “if America’s relaxed about the source of funds,” another lawyer, Sam Bayat, who works with a lot of clients in the Middle East, told me. Shady Russian oligarchs, in other words, might be the target demographic, rather than an edge case.

The far bigger story is the reverse phenomenon: Thousands of Americans a year are applying to visa programs abroad, primarily in Europe—Portugal in particular—and the Caribbean, where island nations offer citizenship outright, sometimes upon purchase of property. An American doctor or dentist considering a second home in storm-addled Florida might now buy a $325,000 condo in St. Kitts and Nevis instead and, in the bargain, qualify for the island nation’s citizenship in as little as three months. A nature lover might look to Costa Rica, which grants residence (and a fast track to citizenship) for $150,000. Vanuatu will effectively sell you a passport for $130,000; Dominica’s costs $200,000.

Historically, people have looked to buy a different citizenship because they live under undemocratic political systems, or because their passport makes it difficult to travel. (Afghans, for instance, can go to just six countries without a visa; Spaniards can go to 133.) Eric Major, the CEO of the immigration-advising firm Latitude, began his career helping rich Hong Kongers make exit plans to relocate to Canada or the United Kingdom ahead of the territory’s scheduled handover to China. “The smart capital, the top guys in Hong Kong in the 1990s, were all saying, ‘We gotta hedge,’” Major told me, referring to fears that China would crack down on business and political freedoms. Major went on to work mainly with clients from China, Russia, India, and the Middle East.

Today most of Major’s clients are American. Volek’s firm has more clients from America than from the next four biggest feeder countries (Pakistan, Nigeria, India, and the U.K.) combined. Fifteen years ago, the firm did not see much point in opening a U.S. office. This year, it’s launching its tenth. “I never would have imagined my No. 1 source market would become America,” Major told me. “But now the top brass of America is hedging.”

Hedging is the operative word: Few of these Americans are actually moving abroad at the moment. It’s about having options, Volek said: “It’s purely the realization that, ‘I’m wealthy and diversified in terms of assets, bonds, and equities, so why on earth would I have one country of citizenship and residence? It makes no sense.’”…

Americans without a ton of money are finding ways to access new passports by re-hyphenating themselves. Many are casting around for long-lost relatives through which they can claim Italian, Irish, Austrian, or German citizenship. Tracking down birth certificates from the old country and persuading embassies to accept them as proof of citizenship used to be logistically complicated; now there are consultants to help with that too. European countries have grown accustomed to American applicants who want to expand their options and lower the cost of college, health care, and child care.

According to one estimate, about 40 percent of U.S. citizens might be eligible for European passports through their ancestors. Last year, Ireland received 31,825 passport applications from U.S. citizens, Austria naturalized 1,914(virtually all as reparations for Nazi-era persecutions), and more than 6,100 Americans applied for British citizenship, with a noticeable uptick beginning in November….

Source: Americans Are Buying an Escape Plan