Archive for the ‘anti-kleptocracy’ Category

Is Harvard Whitewashing a Russian Oligarch’s Fortune?

Monday, May 27th, 2019

Originally published in The New York Times on December 5, 2018: https://www.nytimes.com/2018/12/05/opinion/harvard-russian-oligarch-whitewash.html

Len Blavatnik made billions as a Kremlin insider. Now he’s writing huge checks to the university.

By Ann Marlowe
Ms. Marlowe is a writer.

Dec. 5, 2018

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Len Blavatnik recently pledged $200 million to Harvard Medical School.
Credit
Joe Giddens/Pa, via Associated Press

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Len Blavatnik recently pledged $200 million to Harvard Medical School.CreditCreditJoe Giddens/Pa, via Associated Press
This article has been updated.

By now, most Americans are aware of the deep and disturbing connections between Russia’s oligarchs and the country’s president, Vladimir Putin, thanks to an onslaught of news coverage and a growing list of sanctions aimed at them and their business empires.

Yet a surprising number of respected American institutions don’t seem to get it, including two that I am connected with: the Hudson Institute and Harvard.

On Tuesday, the founder, director and sole funder of the Hudson Institute’s Kleptocracy Initiative, Charles Davidson, announced that he was leaving his position at the head of the initiative because Hudson had accepted a $50,000 donation for a table at its annual gala from Leonard Blavatnik, a Soviet-born dual British-American citizen who made his money in the rough and tumble of Russia’s commodities privatizations during the 1990s and now owns, among other properties, Warner Music Group.

“Russian kleptocracy has entered the donor pool of Hudson Institute,” he told The New York Post. “Blavatnik is precisely what the Kleptocracy Initiative is fighting against — the influence of Putin’s oligarchs on America’s political system and society — and the importation of corrupt Russian business practices and values.”

Sources at the Hudson Institute said that Kleptocracy Initiative would continue, but did not comment on the Blavatnik gift. (Disclosure: I am a visiting fellow at Hudson, but it is an honorary position, and I have neither received money from the institute nor performed work for it.)

Mr. Blavatnik’s glory at Hudson largely lasted just one night. But he did succeed in attaching his name to Harvard for generations to come. On Nov. 8, Harvard Medical School announced that the Blavatnik Family Foundation had pledged $200 million to the institution, creating the Blavatnik Institute and Blavatnik Harvard Life Lab. This follows on a $50 million gift by the foundation to the university in 2013.

(Asked for comment, a Harvard spokeswoman said in a statement: “Harvard Medical School is deeply grateful for the generous and transformational commitment from the Blavatnik Family Foundation that will support discovery at HMS propelling the school’s mission to transform human health.” She also referred me to someone who handles media relations for the foundation.)

As a Harvard alumna, I find this appalling. Mr. Blavatnik — who, with a net worth of over $20 billion, is the richest man in Britain and the 29th-richest in America — cut his teeth in the brutal aluminum wars in 1990s Russia alongside Oleg Deripaska and Roman Abramovich, who has estimated that every three days someone in the business was murdered. Together, they acquired an empire of recently privatized metals and energy companies, often for outrageously low prices.

Those deals, and others, involved a series of transactions with individuals with checkered pasts, deep Kremlin ties and a reputation for corruption. Though Mr. Blavatnik is not under American sanctions himself, many of his associates are, including Mr. Deripaska. The aluminum giant Rusal, where he is a major shareholder, is facing direct sanctions due to go into effect soon; Rosneft, an energy company owned by the Russian government where he also made millions, expects the ax to fall shortly.

One of Mr. Blavatnik’s early investments, United Trading Company, which he owned with Viktor Vekselberg, another oligarch also under American sanctions, brought him censure from the Russian government.

In 2004 the pair had to give up ownership of United Trading after the Russian government charged it with anti-competitive actions; they sold their shares to three other Kremlin-linked investors, Dmitri Pyatkin, Aleksandr Fraiman and Igor Annensky.

In 1996, Mr. Blavatnik and Mr. Vekselberg helped found SUAL, a large aluminum producer; through it, they own over a quarter of Rusal. The other big shareholder in Rusal is Mr. Deripaska’s En+ Group, which controls 48 percent.

Mr. Blavatnik’s biggest deal involved selling his stake in the Russian oil company TNK-BP to Rosneft in March 2013; he and his partners, including Mr. Vekselberg, together made $27.7 billion. The deal was arranged at the top levels of the Russian government; since 2004, Rosneft has been run by a close ally of Mr. Putin, Igor Sechin, a former deputy prime minister.

To be clear, Mr. Blavatnik is not accused of any crimes, in the United States or in Russia. But he is undoubtedly a Kremlin insider, someone who has made an enormous fortune trading on his political connections to a deeply corrupt circle of oligarchs and a criminal Russian state.

Mr. Blavatnik is entitled to spend his money how he pleases. But institutions like the Hudson Institute and Harvard, which at least in principle stand for the ethical pursuit of knowledge, sully themselves by accepting it.

Accepting gifts — especially naming gifts — from people with dubious sources of funds or close ties to despotic regimes encourages the view that dirty money can be cleansed by charity. What lessons does that teach Harvard students? And what message does it send to citizens of countries troubled by kleptocracy and corruption?

One of the gates to Harvard Yard has a celebrated inscription: “Enter to grow in wisdom. Depart to serve better thy country and thy kind.”

I still remember that. I wonder if Harvard does.

Ann Marlowe is a writer and consultant who specializes in investigating corruption.

Two Princes: Erik Prince and the Seychelles meeting

Monday, May 27th, 2019

Originally published in Fast Company, September 28, 2018: https://www.fastcompany.com/90233994/how-a-secret-seychelles-meeting-signaled-the-uae-pull-in-trump-d-c

09.28.18
Two Princes: How a secret meeting signaled the UAE’s pull in Trump’s D.C.
A meeting in the Seychelles between the Blackwater founder and a Putin ally has drawn scrutiny. It also indicated another backchannel to the White House.
Two Princes: How a secret meeting signaled the UAE’s pull in Trump’s D.C.
There are indications that the “Trump-Emirates” group has already had a frightening degree of impact on U.S. foreign policy. [Photos: skeeze/Pixabay; DOD photo by U.S. Air Force Tech. Sgt. Brigitte N. Brantley; Flickr user Miller Center]
BY ANN MARLOWELONG READ
Please see the Editor’s Note at the bottom of this article.

On January 11, 2017, a week before Trump’s inauguration, two powerful men huddled together at the bar of the Four Seasons Hotel in the Seychelles, off the coast of east Africa: a fit, 6-foot-tall middle-aged American, with a military bearing, and a slightly younger Russian man, balding and bespectacled. They each nursed a beer and spoke quietly, so that the pair of Arab-looking men in dark suits standing nearby didn’t even try to eavesdrop. Every few minutes, the American checked his watch, a rescue-beacon-equipped Breitling Emergency.

Special counsel Robert Mueller has reportedly zeroed in on the hush-hush meeting, gathering evidence that shows it may have been one of the first efforts to set up a covert line of communication between Trump and Putin. But amid the scrutiny of Trump’s ties with Russia–and on meetings like the one in the Seychelles–another important story has been overlooked: the attempts by the United Arab Emirates, many successful, to influence the Trump administration, especially concerning its archrival Qatar.

The de facto ruler of the UAE, crown prince of Abu Dhabi Mohammed bin Zayed al-Nahyan, or “MBZ” as he’s known, has met with members of the Trump coterie in two informal circumstances that we know of: in December 2016 in New York with campaign advisers Steve Bannon, Mike Flynn, and Trump son-in-law Jared Kushner, and on January 11, 2017, in the Seychelles. There, MBZ arranged for the drink between Erik Prince—the Breitling-wearing founder of the now-defunct paramilitary firm Blackwater and brother of Trump secretary of education Betsy DeVos—and an associate of Russian President Vladimir Putin.

The 57-year-old crown prince would amass a surprising number of useful American contacts. Among them were his adviser, Lebanese-American businessman George Nader, Republican fundraiser Elliott Broidy, whose security company later secured hundreds of millions of dollars in UAE contracts, and Trump inauguration committee head Tom Barrack, whose real estate business has profited handsomely from Emirate deals.

Abu Dhabi’s Crown Prince Mohammed bin Zayed Al Nahyan (MBZ) met with Secretary of Defense Jim Mattis in Washington, D.C. on May 15, 2017. [Photo: DOD photo by U.S. Air Force Tech. Sgt. Brigitte N. Brantley]
There are indications that the “Trump-Emirates” group has already had a frightening degree of impact on U.S. foreign policy, including Trump’s exuberant support for the 2017 Saudi and UAE-led regional boycott of Qatar and his March 2018 firing of Secretary of State Rex Tillerson. The countries have also pressured Washington to move the forward headquarters of U.S. Central Command out of Qatar and sever Pentagon ties with a longtime regional ally.
Meanwhile, despite bipartisan protest, the Trump administration has supported a three-year-old Saudi and UAE-led military assault on Iran-backed Houthi rebels in Yemen, which last month included an errant missile attack that killed schoolchildren on a bus. More than 16,700 civilians have been killed or injured during the siege, which has fed what the United Nations says is the world’s worst humanitarian crisis.

None of this, by the way, is meant to endorse Qatar or other rivals of the UAE or their agents of influence in the slightest way. But all of the Emirati efforts need more attention, before the U.S. is dragged into a pointless Middle East conflict.

ERIK PRINCE AND THE RUSSIAN AT THE BAR
Prince told the House’s Permanent Select Committee on Intelligence in November 2017 that he was invited to the Seychelles by “one of the members of the Royal Court” to discuss everything from “security issues to mineral issues to even bauxite.” The Emirati customers “mentioned a guy I should meet who was also in town to see them, a Kirill Dmitriev from Russia, who ran some sort of hedge fund.”

Dmitriev is the CEO of the Russian Direct Investment Fund, the state’s $10 billion sovereign wealth fund. RDIF’s links with the Kremlin may have led the U.S. to sanction the fund. It also boasts tight links with Abu Dhabi: The UAE sovereign fund Mubadala has co-invested with RDIF in 40 investments in Russia since 2013.

Prince–a former Navy SEAL whose Blackwater firm was implicated in a massacre of civilians in Iraq in 2007–has been described by other attendees at the meeting as presenting himself as an unofficial envoy for President-elect Trump. But in sometimes testy and arrogant responses to the committee, Prince insisted he was not acting on behalf of Trump and denied that the meeting had anything to do with a Russian backchannel. The encounter with Dmitriev was an impromptu introduction, Prince claimed: The Russian official just happened to be at the hotel, also meeting Emiratis.

Erik Prince, founder of the defunct security firm Blackwater, appeared before the House Intelligence Committee on November 30, 2017. Prince has been on MBZ’s payroll since around 2010, when he changed his residence to the UAE, and founded his post-Blackwater company R2. [Photo: Mark Wilson/Getty Images]
They met at the bar and spoke for 30 minutes, Prince said, chatting on “topics ranging from oil and commodity prices to how much his country wished for resumption of normal trade relations.”
“I remember telling him,” Prince recalled, “that if Franklin Roosevelt could work with Joseph Stalin to defeat Nazi fascism, then certainly Donald Trump could work with Vladimir Putin to defeat Islamic fascism.”

According to a memo reviewed by the Daily Beast and first reported on Wednesday, Prince and Dmitriev discussed a range of possible collaborations, including a military effort to take out specific ISIS leaders in Syria, nuclear and chemical nonproliferation, and a perplexing plan for RDIF to invest money in the U.S. Rust Belt, “creating real jobs for hard hit area with high employment.” The proposals echo ideas that have been raised by Moscow more officially.

Why did MBZ broker the meeting? In part, U.S. and European officials say, it was to determine if Russia could be persuaded to withdraw its support of the Assad regime in Syria, an aim of Saudi Arabia as well as the Trump administration. Such a move would have probably required the U.S. to take the unlikely step of lifting sanctions imposed on Moscow over its actions in Ukraine.

But if MBZ aimed to establish a backchannel between Trump and Russia, he was motivated by a range of other self-interested reasons, including obtaining Trump’s support against Qatar and possibly weaning the militant group Hamas from Qatari influence.

Mahe Island in the Seychelles. The meeting MBZ helped arrange there between Prince and a Putin ally is being examined by Special Counsel Robert Mueller. [Photo: SCAPIN/Pixabay]
Among the Americans MBZ hoped he could count on, perhaps no one was closer to Trump’s White House–and to MBZ himself–than Prince. In his House testimony, Prince said that while he has met with the crown prince “more than 12 times,” he does not know the crown prince well and did not do a significant amount of business with the UAE. But Prince and has been on MBZ’s payroll since around 2010, when he changed his residence to the UAE.
That year, Prince began building a private army for MBZ for a reported $529 million and helped train a Somali anti-piracy force funded by the UAE. Through a post-Blackwater company R2, founded in the UAE in 2010, Prince has also trained mercenaries who fight under the UAE flag in Yemen. In 2012, when Prince launched a private equity firm, FRG (Frontier Resource Group), eventually listed on the Hong Kong Stock Exchange, the investors included both the UAE’s Sheikh Tahnoun bin Mohammed Al Nahyan and Abu Dhabi’s Crown Prince Court.

Apart from his sister, Prince’s strongest link to the White House was through former campaign chairman and top adviser Steve Bannon. Prince told lawmakers that he spoke periodically with Bannon and sent him unsolicited policy papers during the 2016 campaign. Bannon also hosted Prince frequently on Breitbart’s radio and website, where Prince aired anti-Hillary Clinton stories during the campaign.

In 2016, Prince and his mother donated $150,000 to the Super PAC Make America Number 1, one of Trump’s biggest supporters. And Prince is taken seriously by the Trump administration as a foreign policy guru: The White House is currently reviewing a plan by Prince to privatize the war in Afghanistan that has gained little support in the Pentagon.

Prince may have also introduced former Trump adviser Steve Bannon to MBZ. The crown prince met with Bannon, along with Jared Kushner and General Michael Flynn, in New York in December 2016; in a breach of protocol the UAE didn’t notify the Obama administration of the visit in advance. Prince told the House committee that the former Breitbart CEO said the meeting concerned Iran and Syria, and that the Emirati ruler “is a great guy.”

Bannon, Kushner, and Flynn all have close connections to Cambridge Analytica, a now-defunct company part-owned by the U.K.-based SCL Group Ltd. Infamous now for its misuse of Facebook data on behalf of the Trump campaign, in December 2016 this U.S. subsidiary of SCL was basking in its triumph. Within a year, SCL would be waging a clandestine influence campaign against Qatar on behalf of MBZ. According to federal filings, SCL Social Limited was hired for $330,000 in October 2017 to run a #BoycottQatar social media campaign for the UAE. When asked in October about the SCL work against Qatar, Bannon said he had nothing to do with it.

GEORGE NADER: A PRINCELY ADVISER WITH TIES TO RUSSIA AND THE WHITE HOUSE
We still don’t know, and we may never know, everyone who was at the now notorious rendezvous in the Seychelles and what they discussed. Apart from MBZ, Prince, and Dmitriev, the UAE’s spymaster Hamad al Mazrouei and another adviser to the crown prince, Palestinian politician Mohammed Dahlan, may have also attended, the Daily Mail reported.

Also present was George Nader, who helped organize the meeting. Nader, a longtime MBZ adviser with ties to the Kremlin, has contradicted Prince’s characterization to the House committee. According to sources close to the Special Counsel’s investigation, Nader–who first met Prince while representing his security contractors in post-invasion Iraq–reportedly told investigators that one of the primary goals of the meeting was to establish a line of communication between the Kremlin and the incoming administration, and said he had met Prince a week before the Seychelles meeting to brief him on Dmitriev.

This wasn’t the only high-powered meeting that the 59-year-old consultant arranged for MBZ in recent years. In mid 2015 Nader helped convene a yacht meeting in the Red Sea that included the crown prince, his Saudi counterpart Prince Mohammad bin Salman, President Sisi of Egypt, the crown prince of Bahrain, and the king of Jordan. The objective, according to sources who spoke with the pro-Qatari Middle East Eye, was to curtail the influence of Turkey and Iran. It’s not known what was discussed at the meeting, which took place after Trump announced his candidacy that June, but these were the countries that, with the exception of Jordan and the addition of Libya, would form an anti-Qatar alliance in 2017.

Nader’s entrée to Trumpworld started with Prince. The Blackwater founder arranged an August 2016 meeting at Trump Tower in New York between Nader, Donald Trump Jr., and an Israeli social media specialist, Joel Zamel. At that encounter–two months after a notorious Trump Tower meeting at which a Russian attorney offered damaging material on Hillary Clinton–Nader told Trump Jr. that the princes who led the UAE and Saudi Arabia were eager to help his father win the election. Zamel pitched Trump Jr. on a multimillion-dollar social media manipulation campaign run by his company PSY-Group, which employed several former Israeli intelligence officers.

It isn’t clear if such a campaign was initiated–Trump Jr.’s lawyer has said that his client wasn’t interested–but Nader was subsequently embraced as an ally by the Trump campaign. In his capacity as an adviser to MBZ, he met frequently with campaign advisers, including Bannon, Flynn, and the president’s son-in-law, Jared Kushner. At some point after the election, Nader paid Zamel up to $2 million, reportedly for a presentation about the significance of social media in political campaigns. Mueller is also said to be investigating this payment.

Nader achieved a remarkable amount in the months that followed the Seychelles meeting, after Trump’s inauguration. Nader would become a conduit for Emirati money used to influence Trump’s circle, as he reportedly told the special counsel. He would make frequent trips to the White House in the early months of the administration, meeting with Bannon and Kushner to discuss Middle East issues ahead of Trump’s trip to Saudi Arabia in May 2017. In an Oval Office meeting, Nader would pressure Trump to fire Tillerson after the secretary of state had intervened to stop the proposed invasion of Qatar by the UAE and Saudi Arabia. And Nader would get a big fish on the line: former RNC finance chairman and longtime fundraiser Elliott Broidy.

ELLIOTT BROIDY, A STEALTH INFLUENCE CAMPAIGN, AND A SECURITY CONTRACT
Broidy is very close to Trump, and was a significant fundraiser for the campaign. After the election, he was appointed deputy finance director Republican National Committee, but resigned that position earlier this year after a woman claiming to be his former mistress sued him for breach of an agreement to pay her $1.6 million not to disclose the affair.

(Broidy has previously run afoul of the law: In 2009 the 61-year-old fundraiser plead guilty to paying New York pension fund officials almost $1 million in return for $18 million in management fees. In 2013, he withdrew his original felony plea prior to conviction and in return for his cooperation and restitution of the $18 million, the court allowed him to plead to a lesser misdemeanor charge instead. Broidy is now under investigation for influence peddling in China and Malaysia, the Washington Post reported in August. Nader has a criminal history as well: in 2003, he was convicted in the Czech Republic on charges of child molestation and child pornography.)

Just weeks after the Seychelles meetings, Broidy and Nader met for the first time, during Trump’s inauguration. By February—before Trump’s first visit to Saudi Arabia that May, which is generally thought to be the start of the UAE-Saudi campaign against Qatar—the two men were communicating about Saudi and Emirati policy goals in Washington and discussing potential contracts for Broidy’s obscure private security company, Circinus, with both the U.A.E. and Saudi Arabia. Nader also introduced Broidy to MBZ and later in 2017 helped Broidy obtain $200 million in UAE contracts.

A trove of emails between Broidy and Nader allegedly hacked by agents of Qatar and reported by the Associated Press revealed that Nader and Broidy collaborated on an anti-Qatar influence campaign. In one email from February 7, 2017, Broidy wrote to a congressional staffer about an anti-Qatar bill. Later, he would brag to Nader of his closeness to Treasury Secretary Steven Mnuchin, saying that he could “educate” Mnuchin on adding Qataris to U.S. sanctions lists.

Elliot Broidy, fundraiser and former deputy finance chairman for the Republican National Committee. A George Nader company in the UAE sent $2.5 million to a Canadian company belonging to a friend of Broidy. From there it entered a Broidy bank account in L.A. [Photo: Stefanie Keenan/Getty Images for Pepperdine University]
According to summaries written by Broidy of two meetings he had with Trump, Broidy “was passing messages to the president from the two princes and that he told Trump he was seeking business with them,” the AP reported. Documents also showed that “the lobbying was intertwined with the pursuit of contracts from the very start, and involved specific political tasks carried out for the crown princes.”
On April 24, 2017, the Wall Street Journal published an anti-Qatar op-ed signed by a retired Air Force general, Charles Ward. It turned out that Ward was part of the Circinus team that had pitched Saudi Arabia for security work. And Broidy had sent a draft of the piece to Nader three days before publication.

That May, Broidy, who sometimes referred to Qatar as “the snake,” persuaded a U.S. think tank, the Foundation for the Defense of Democracies, to hold an anti-Qatar conference at the Fairmont Hotel in Washington. Broidy told the foundation’s CEO that the money for the conference did not come from a foreign government and that he had no contracts in the Gulf at the time.

The same day as the conference, the UAE was behind a series of hacks targeting Qatari news and social media sites. The Washington Post reported that disinformation was posted and attributed to Qatar’s emir, Sheikh Tamim Bin Hamad al-Thani–including false reports that the emir called Iran an “Islamic power” and said, “Hamas is the representative of the Palestinian people.”

As Qatar’s Al Jazeera reported, citing research from the University of Exeter, a well-orchestrated bot campaign “began spreading sectarian, anti-Iranian, and anti-Semitic rhetoric, while heaping praise on Trump” and “began framing the discussion of ‘extremism’ towards criticism of Qatar for being a ‘servant of Iran’ (while being paradoxically close to Israel), and for its alleged ties to the Muslim Brotherhood, Hamas, and others.” At the end of May, the UAE, Saudi Arabia, Bahrain, and Egypt cited the false news reports as the reason for a ban on Qatari media. They broke relations with Qatar and imposed a trade and diplomatic boycott.

In early June, the email of Yousef al-Otaibi, the UAE’s high-powered ambassador to the U.S., was hacked and offered to U.S. media outlets. One of his emails, to former Defense Secretary Robert Gates, was especially embarrassing, as Otaiba had sent Gates greetings from MBZ. Gates had been a speaker at the anti-Qatar FDD conference in May.

A month later, in July, Broidy sent George Nader a spreadsheet outlining a proposed $12.7 million campaign against Qatar and the Muslim Brotherhood. And between 2017 and March of this year, Broidy gave $600,000 to members of Congress backing anti-Qatar legislation. In October, Broidy helped arrange another anti-Qatar conference at the Hudson Institute in D.C., featuring a keynote by Steve Bannon.

The payments for Broidy’s influence efforts took a circuitous route. As the AP discovered, a Nader company in the UAE sent two payments totaling $2.5 million to Xiemen Investments Limited, a Canadian company belonging to a friend of Broidy, in April 2017. From there it entered a Broidy bank account in L.A. The source of Nader’s funds remains unknown.

Broidy maintains that he was not working under the direction of a foreign government, and that therefore he had no obligation to register with the U.S. government under the Foreign Agents Registration Act. The federal law requires lobbyists to disclose their ties and certain political activities if they are paid or even merely directed by foreign interests to influence policy. Violating FARA carries a maximum fine of $10,000 or up to five years in prison. Mike Flynn, Paul Manafort, and Rick Gates all failed to register under FARA, only doing so retroactively. Last month, campaign consultant Sam Patten pleaded guilty to acting as an unregistered foreign agent during the election, paying $50,000 in cash from an unidentified Ukrainian oligarch to the Trump inauguration committee, for which Broidy was vice chairman.

TOM BARRACK, THE PRINCE-LINKED DONOR WHO HELPED KEEP JARED KUSHNER OUT OF BANKRUPTCY
On June 5, 2017, the Saudi-UAE led coalition announced its blockade of Qatar. Secretary of State Rex Tillerson quickly intervened in an effort to calm the situation. He succeeded, but reportedly infuriated Crown Prince MBZ as well as members of the Trump White House. During an Oval Office meeting that October, Nader urged the President to fire Tillerson, “but only at a good time, politically,” as Nader recounted in a memo to Broidy. Tillerson would depart on March 31, 2018.

Tillerson was also undermined by Trump himself, who, after the blockade was announced, called Qatar “a funder of terrorism at a very high level.” At the time, Tillerson’s aides thought that Emirati ambassador Otaiba might have written that line for Trump.

Otaiba already had enough influence in Trumpworld that this suspicion was plausible. Jared Kushner was introduced to Otaiba by real estate financier and GOP donor Tom Barrack. Barrack, 71, whose parents are Lebanese-Catholic, is a native Arabic speaker and has had long ties in the region. He also had many business connections with Otaiba, and had even dealt with Otaiba’s father.

In 2009, Barrack worked with Otaiba to sell a Beverly Hills hotel for $41 million to a joint venture half owned by the Abu Dhabi sovereign wealth fund. In 2012 Otaiba himself invested $1 million in a fund Barrack set up. Last year, a state investment fund controlled by MBZ invested $70 million in one of Barrack’s real estate partnerships, a landmark office tower in Los Angeles.

Tom Barrack, real estate investor and GOP donor. “Thanks to you, I’m in constant contact with Jared,” the UAE’s ambassador to the U.S. wrote Barrack in an email. [Photo: Brinson+Banks]
Barrack himself also once helped Kushner out of a financial jam. As the New York Times reported in June, the GOP donor bought up $70 million of Kushner’s debt on 666 Fifth Avenue and at Trump’s request was “among a group of lenders who agreed to reduce Mr. Kushner’s obligations to keep him out of bankruptcy.”
In spring 2016, Barrack introduced Otaiba and Kushner, telling Otaiba, who was skeptical of Trump’s anti-Muslim rhetoric, that the candidate “also has joint ventures in the U.A.E.!” Kushner’s introduction to Otaiba quickly led to a connection to MBZ himself. Reportedly, Kushner spoke directly with UAE Crown MBZ and the Saudi Crown Prince through WhatsApp, bypassing the State Department in an astonishing breach of procedure.

“Thanks to you, I’m in constant contact with Jared,” Otaiba wrote Barrack in an email obtained by the Times.

Otaiba was also close to Trump’s 2017 deputy national security adviser, Egyptian-American Dina Powell, whose entrée to the White House came through advising Jared’s wife, Ivanka Trump, during the campaign. The relationship was such that Otaiba forwarded to Powell an email exchange he had with a Politico journalist who criticized Egyptian President Sisi.

The Trump administration was also good for Barrack. His real estate fund Colony Northstar has received $7 billion in investments since Trump’s nomination, a quarter of which has come from the UAE or Saudi Arabia.

A $450 MILLION LEONARDO AND A BARGAIN GOLF COURSE
Some Trump-Emirates links suggest MBZ may be managing financial ties with Trump companies in other ways. One example is his bidding in the auction of a Leonardo painting belonging to Dmitry Rybolovlev. In 2008, the Russian billionaire paid Trump $95 million for an oceanfront Palm Beach estate that Trump had purchased for $41 million in 2004; the house sat empty for years before being demolished. The property has since been divided into three lots, two of which Rybolovlev has re-sold for over $71 million.

In November 2017 Rybolovlev sold Leonardo’s “Salvator Mundi” in a Christie’s auction that set a new world record price of $450 million. The price of the 26-inch painting–valued at around $80 million the year before–was driven high by a bidding war between a representative for Saudi Arabia’s Crown Prince bin Salman and the UAE’s MBZ, each of whom claimed they mistakenly thought they were bidding against the Qataris. MBZ was trying to buy it for the Louvre Abu Dhabi. Saudi Arabia “won” the painting, but then gave it to MBZ in exchange for the crown prince’s $450 million superyacht, the Topaz. (MBZ has donated it to the museum, where it was scheduled to be have been unveiled in September, but its exhibit has been delayed.)

Could the bidding war have been a way to funnel UAE funds to the Russian tycoon? While it’s unlikely the painting sale–which made Rybolovlev over $320 million–was related to the Palm Beach purchase, it is conceivable that these two deals are part of a larger number of transactions we don’t yet know about, in which the UAE rewards Trump indirectly for his support.

There is a UAE link straight to Trump’s business holdings, too. As Trump prepared to run for president, MBZ would have known that in April 2014, Trump bought the Turnberry golf course in Scotland from Leisurecorp, a UAE state-owned enterprise, for what was termed at the time a “bargain price,” in a £35.7 million ($63 million) “cash deal.” The UAE had put a total of £92 million into the property, which it bought in 2008. Leisurecorp paid £52 million for the resort–which comprises three courses, a golf academy, a five-star hotel, as well as lodge and cottage accommodations–and then proceeded to spend a further £40 million on renovations.

It’s unclear why the UAE effectively made a £58 million gift to Donald Trump in 2014. But this is one of many questions about the Trump-Emirates relationship that needs more attention, especially before that relationship drags the U.S. into more dangerous adventures in the Middle East.

Ann Marlowe (@AnnMarlowe) is a writer and consultant in New York. The author is indebted to the reporting of Wendy Siegelman for many insights, including the importance of the Bannon link and her research on the UAE ties of Cambridge Analytica and its successor companies.

Editor’s note: This story has been updated to reflect the subsequent division and sale of the Palm Beach estate. An earlier version of this story also contained several inaccuracies regarding Elliott Broidy which have been corrected and/or clarified. They are:

The nature of Broidy’s work with the UAE in 2017. Broidy and Nader collaborated on an influence campaign in Washington in support of UAE and Saudi interests at a time when Broidy was expecting contracts from the UAE eventually worth hundreds of millions of dollars. Broidy maintains that because that work involved no direct instruction or payments from those governments for Washington lobbying he was not required to register under FARA.
When Broidy first met Nader, as well as the timing of UAE contracts with Broidy’s company.
How Broidy represented the source of his funding for a May 2017 anti-Qatar conference in Washington. According to the CEO of the foundation hosting the conference, Broidy said at the time that he had no contracts in the Persian Gulf.
That Broidy resigned his RNC position as a result of the controversy surrounding a payment to an alleged former mistress, but not because of a request to investigate the payment.
In 2013 Broidy withdrew an original felony plea related to rewarding official misconduct and plead to a lesser misdemeanor charge instead.

How Cambridge Analytica Fueled a Shady Passport Trade

Monday, May 27th, 2019

Originally published in Fast Company, July 1 2018: https://www.fastcompany.com/40571052/how-cambridge-analytica-fueled-a-shady-global-passport-bonanza
In 2010, as elections neared in Saint Kitts and Nevis, a grainy hidden-camera video was uploaded to YouTube. In the anonymously produced clip, voters across the small Eastern Caribbean island nation saw prime minister candidate Lindsey Grant in a hotel room, listening as a British-accented property developer promises him a $1.5 million payment in exchange for a bargain price on a plot of government land.

“What we’re after is making sure you get into power,” says the developer, whose face and voice are obscured. In return, “you will help us. . . how does that sound?”

Grant, a Harvard Law School-educated lawyer running on an anti-corruption platform, appears reluctant, but eventually pushes the bribe higher, to $1.7 million. The video cuts to white text on black: “He sold his country and the people’s land just to win power.”

The video went viral in Saint Kitts, and the incumbent prime minister, Denzil Douglas, was soon re-elected for a fourth term. Douglas denied any knowledge of the sting operation, but across the Caribbean, speculation swirled that it was the work of a clandestine London-based political consultancy: SCL Group.

The now-defunct Anglo-American firm has gained notoriety for its harvesting of Facebook profiles and shady campaign tactics, but the storm of controversy has been building for decades. Before its younger sibling, Cambridge Analytica, worked for Donald Trump, SCL Group claimed to have built a portfolio of political work in three dozen countries, deploying its “behavioral change” tactics in sometimes shaky democracies.

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In the Eastern Caribbean, where SCL quietly operated in at least six countries, some of its work had an indirect objective: Assisting a lucrative trade in passports. The sales are legal, and lucrative, with the world’s rich thought to spend over $2 billion on “citizenship by investment,” or CBI. But reporting and interviews with industry insiders show how a nexus of buyers, officials, citizenship agents, and consultants has helped enable criminals and ignited political wildfires that continue to rage even now.

In at least five Caribbean nations, the company’s campaigns were backed by Christian H. Kalin, the chief executive of Henley and Partners, a London-based firm that markets and sells second passports, and helped support politicians thought to be sympathetic to Henley’s interests. With a friendly politician in office, according to people familiar with the arrangement, Henley could then become that country’s primary passport merchant, giving it the right to earn lucrative commissions on every sale.

Where SCL worked on campaigns, in some cases with support from Christian Kalin. View a world map of its elections work. [Map: Wikipedia / Infogram / Fast Company]
“It was a particular way of achieving his strategic objective, which was to supply money and supply campaign provision to put in to power the government that would be conducive to both him and his clients,” Sven Hughes, who worked on the campaigns as SCL’s head of elections from 2009 to 2010, told Fast Company. To win elections, he said, SCL’s then-CEO Alexander Nix regularly turned to questionable techniques, including the hidden-camera video.
Well before the 2010 campaign in Saint Kitts, Henley and Partners worked with Denzil Douglas’s government to turn the country into a citizenship Mecca. For the bargain price of $150,000, approved applicants who donate to the island’s sustainable growth fund can now obtain a passport that, as of 2009, allows visa-free travel to over 100 countries, including the U.K. and the 26-nation European Schengen zone. In Dominica, a similar passport can now be had for $100,000. For those interested in investing in real estate, the passport fees are even lower.

Funds from the passports are now a major source of revenue and investment for these countries, filling holes left by weakening exports and the impacts of hurricanes and climate change: By 2014, passports had become Saint Kitts’s biggest export, with the revenue thought to account for 25% of GDP. Neighboring islands and over 30 countries around the world have set up similar CBI programs, and the U.S. has a related investment scheme, the EB-5 visa. (The use of the EB-5 by Trump son-in-law Jared Kushner’s company is now under federal investigation.)

But Saint Kitts and Dominica offer two of the world’s cheapest, largest, and oldest CBI programs. And, unlike some rich countries that require aspiring citizens to actually reside there, Dominica, which is just 290 square miles, and Saint Kitts, which is only 105 square miles, do not.

Many of the passport holders are from countries with unpopular passports who may otherwise have trouble obtaining travel visas—think Iran, China, Russia, Afghanistan, Pakistan. The firms say their well-heeled clients are seeking protection against unpredictable situations at home amid an era of terrorism fears and economic instability.

Saint Kitts and Nevis [Photo: Flickr user Boss Tweed]
But the investment programs have also proved popular with a Who’s Who of fugitives and fraudsters. Convicted felons Paul Bilzerian and Roger Ver gave up their U.S. citizenship and now use Saint Kitts passports. Ross Ulbricht, the founder of the illicit marketplace Silk Road, now appealing a life sentence handed down by a U.S. court, was attempting to obtain Dominica citizenship when he was arrested.
Overseas tax evasion is estimated to cost the U.S. as much as $100 billion annually, but Washington’s concerns are larger than taxes. It was a series of “Iranian nationals” seeking to evade global sanctions whom the U.S. Treasury cited in 2014 when it added Saint Kitts’s passports to a watch list, warning financial institutions of their role in “illicit financial activity.”

Alexander Nix [Photo: Sam Barnes/Web Summit via Sportsfile]
The following year, in testimony to the U.S Senate armed services committee, John Kelly, then Marine Corps general and current White House chief of staff, said the passport programs “could be exploited by criminals, terrorists, or other nefarious actors.” Kalin, a wiry Swiss economic citizenship impresario known as “the passport king,” admitted in an interview with 60 Minutes last year that the Saint Kitts program, which his firm helped design and relaunch in 2006, “tended for some time to attract quite a few people that I would never let into the country.”
Like data about the passports—it’s not publicly known how many are out there and who holds them—the precise role of firms like Henley and SCL has also remained mostly in the shadows, the subject of allegations of dirty tricks, kickbacks, and hidden commissions that have circulated across the Caribbean for years. Then in March, as allegations by former SCL employee Christopher Wylie and Channel 4’s reporting documented a litany of misdeeds by the company, details of the Kalin-SCL relationship first began to emerge in a report in The Spectator.

In an interview with Fast Company, Hughes, the former SCL elections head, said that Kalin was “heavily involved” in the campaigns. As part of the partnership, the Henley CEO would supply financing from unknown investors, provide talking points for candidates, and discuss with them various development projects they could expect once in power. “That might be the building of an airport, that might be building a deep seaport, that might be real estate,” said Hughes. It isn’t clear if any such projects materialized.

During all of the campaigns, according to the former SCL employee, Alexander Nix deployed the same kind of underhanded tactics that the future Cambridge Analytica CEO would later brag about to an undercover reporter for Channel 4 News. Hughes, who said he refused to be involved in Nix’s techniques, decided to leave the company after the CEO’s methods began to imperil the safety of his on-the-ground foreign campaign staff. “I said to him, ‘You’re going to get someone killed.’”

In response to questions from Fast Company, Henley and Partners emailed a statement saying that neither the firm nor Kalin “has ever provided funding for any election campaign, and there has never been any form of connection between the granting of any government mandate we have received and any election.” However, as part of its citizenship-by-investment business, Henley “naturally sometimes also interacts with political leaders of opposition parties that are interested in the topic of investment migration for the purpose of their economic-policy agendas.”

Henley’s relationship with SCL, the firm said, was not a “formal working relationship.” Rather, shortly before the 2010 election in Saint Kitts, Nix was introduced to Kalin by the government of the time, “as he was to many other firms and consultants working with the government on economic, political, or social issues in the Caribbean.”

Nix would become Cambridge Analytica’s CEO when the firm was founded in 2012, with backing from the U.S. hedge fund billionaire and Trump donor Robert Mercer. The company, which declared bankruptcy in May, is now under investigation by British and American authorities.

Under questioning from British lawmakers last month, Nix acknowledged that he and Kalin had a “relationship” during SCL’s campaigning in the Caribbean, and that “he may well have made contributions towards the election campaigns.” Pressed on the nature of their relationship, Nix said that Kalin didn’t work on the campaigns, but “certainly had an interest in the outcome of the elections.”

Nix also told lawmakers that the claims he made in the Channel 4 video about deploying bribes and stings during elections were fabricated and “foolish.” Rather, it was he who had been the victim of an “entrapment sting” by the television network, he said. Representatives for SCL did not respond to a request for comment.

Timothy Harris, the prime minister of Saint Kitts, said his government would await the outcome of the British investigation before commenting on SCL’s and Kalin’s work in Saint Kitts. “The electorate needs to know who and what they are voting for and should not be manipulated through the use of clever analytics,” Harris said in an emailed statement to Fast Company.

Harris encountered SCL’s work in 2015, when he was running for office against Denzil Douglas on a pledge to reform the country’s passport program: Nix, according to a report in the Guardian, turned to a team of Israeli hackers to obtain the candidate’s private emails and medical records.

Harris won that election, and amid global scrutiny of the country’s citizenship investor program, Henley and Partners was dismissed as the country’s main passport seller. In 2014, Henley also lost its position as the primary agent for Dominica’s passports, after SCL’s second attempt to unseat incumbent Prime Minister Roosevelt Skerrit failed.

Cambridge Analytica’s website boasts of its 2010 victory in Saint Kitts and Nevis. View full size here [Screenshot: Cambridge Analytica]
Despite its boasts of having never lost an election, SCL often lost in the Caribbean. The elections firm worked on unsuccessful political campaigns in Dominica, Grenada, St Lucia, and Antigua and Barbuda, where it was accused of spreading deliberately false stories. An unsuccessful campaign for the then-governing party in Trinidad in 2013 has drawn the scrutiny of the country’s attorney general.
Ahead of 2010 elections in Saint Vincent and the Grenadines, Prime Minister Ralph Gonsalves complained that SCL had illegally brought in foreigners on tourist visas to work as political consultants, an accusation echoed in the recent firestorm over Cambridge Analytica’s work for Donald Trump. The fourth-term prime minister—who is alone among the region’s heads of state in resisting citizenship-by-investment programs—also accused foreign actors of spreading a barrage of false stories about him during the campaign.

According to an SCL presentation seen by the Times of London, the firm had launched a “targeted digital attack” against Gonsalves. “Within three weeks every single reference to him on the first two pages of Google . . . referred to the candidate’s horrific track record of corruption, coercion, rape allegations, and victimization,” SCL said in the documents. SCL’s $4 million bill for its work in Saint Vincent that year, according to one series of emails, included $100,000 for “counter operations.”

It was after that campaign that Hughes cut ties with SCL. Nix’s shady, under-the-radar tactics, he said, often left him and SCL’s team of on-the-ground campaign workers in danger. “He’d come in, do one of these leaks, and then fly out and leave the rest of us to pick up the pieces, which left us in a very compromised and sometimes dangerous position.”

Hughes, who is now the CEO of his own London-based communications consultancy, Verbalisation, now sees other dangers in the campaigns he helped run. “Is it acceptable to secretly guide elections with secret money and secret guidance in small countries and overturn the democratic process? Whether or not that’s criminal action or whether or not that’s unethical action, it certainly needs to be investigated.”

“BE READY FOR A BIG BILL”
Concerns about the passport programs aren’t confined to the Caribbean. When reporter Daphne Caruana Galizia was killed in a car bombing in Malta in October, she’d been investigating her country’s own controversial passport sales, and examining links between the government of Prime Minister Joseph Muscat and Henley and Partners. (The firm has been Malta’s exclusive passport agent since it helped launch its CBI program in 2013.) “The damage caused to Malta by the sale of citizenship is unquantifiable,” Caruana Galizia wrote on her blog about the country’s so-called golden visas. “Malta is not St. Kitts & Nevis. It is interlocked with the rest of the EU.”

At the time of her murder, which remains under investigation, Caruana Galizia was facing dozens of defamation lawsuits, including from Henley as well as the cofounder of Malta’s Pilatus Bank, Ali Sadr Hasheminejad. The son of one of Iran’s richest men, Hasheminejad has been linked to money laundering and other corrupt activities with officials in the prime minister’s inner circle. He was also one of Henley’s most prominent customers: the firm helped him secure a Saint Kitts passport in 2009. (When federal agents arrested him in March at a Washington, D.C. airport on charges of evading U.S. sanctions against Iran, he was carrying four passports.) A spokesperson for Henley said that the firm had no relationship with Hasheminejad, and that it had rejected a proposal of his to collaborate on Malta’s passport program.

Since Henley lost its position as the primary agent for marketing Dominica and Saint Kitts passports, another London-based citizenship firm called CS Global Partners has risen in its place. Founded and led by a former attorney at Henley and Partners, CS Global is said to have been financed in part by a British-Indian investor named Dev Bath. Bath, who served as a director at the firm for over a year, remains a consultant to the company. His LinkedIn profile doesn’t mention CS Global, and describes him only by his title, “Special Representative of St. Kitts and Nevis,” which furnishes him with a diplomatic passport to the country.

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Bath has also hired Lanny J. Davis, the longtime D.C. lobbyist and former special counsel to President Bill Clinton, to help promote Saint Kitts and Dominica passports. In one 2013 advertorial extolling the benefits of investor citizenship, Davis quotes his client, who “became a resident of Saint Kitts many years ago and has become a well-known global business leader.”

Last year, Davis’s lobbying work on behalf of Saint Kitts raised eyebrows in Parliament, particularly around the question of who paid him and his law firm more than $96,000. His services—lobbying U.S. and Canadian authorities to lift their restrictions on the country’s passports—”comes at no cost to our government,” Prime Minister Harris told the National Assembly in 2015. Indeed, as public filings indicate, Davis’s fees were paid by CS Global.

Prime Minister Timothy Harris [Photo: Flickr user Saint Kitts and Nevis Photo Stream]
In an email to Fast Company, Davis said he had ceased representing Bath and Saint Kitts over a year ago. “Dev Bath and CS Global perform a valuable service,” he added. Bath declined to comment for this story.
In recent months, one of Bath’s longtime business partners has thrust the country into a fresh storm of bribery allegations. Peter Singh Virdee, a property magnate also of British-Indian descent, had sought to secure solar energy contracts in the Caribbean as part of a renewable energy venture. In one 2016 phone call, disclosed in a British court in May, Virdee described to an associate the need to entertain the prime minister of Saint Kitts and his entourage in London that evening, “so be ready for a big bill.” In another conversation, Virdee, who also holds an Antiguan passport, said that Saint Kitts’s prime minister had asked for a watch and a pair of shoes.

In a preliminary judgment, the U.K.’s National Crime Agency stated that “the claimants were ready and willing to pay bribes, and had given at least one gift to a Caribbean politician.” Virdee, who was arrested in January 2017 at Heathrow Airport on separate charges of a plot to evade millions dollars in carbon credit taxes, has denied any wrongdoing.

Bath and CS Global have not been linked to the allegations surrounding Virdee. But when asked about Virdee’s association with Bath and Saint Kitts, a spokesperson for the Prime Minister’s office said that “a historical business relationship that involves CS Global and the country’s CBI program” is now “under review.”

Amid the allegations, Prime Minister Harris denied any impropriety, and in May called for an investigation into the government of his predecessor Denzil Douglas. Douglas, now leader of the opposition, called for Harris to resign. “As a small Caribbean nation, we are fast losing our reputation,” he said in a recent address, “and the lifeblood of this country is being sucked from it as corruption runs amok, and there seems to be a return of the image of Devil’s Island.”

Douglas–who himself has admitted to once meeting Virdee in the presence of Henley & Partners–is currently embroiled in his own passport scandal: It was recently revealed that he also holds a diplomatic passport from Dominica. The second passport is now being examined by Saint Kitts’s High Court.

A WIN-WIN—OR A RACE TO THE BOTTOM
The governments of the Caribbean and the passport firms insist they have stepped up their reviews of applicants and closed loopholes. (In one notorious instance, Saint Kitts had to recall 5,000 passports, because for years the documents did not include the owner’s place of birth.) Continuing reforms, the Prime Minister’s office said in an email, showed that “we are moving in the right direction.” The new vetting process for prospective Saint Kitts citizens, a CS Global spokesperson said, “is among the most strict in the world.” In May the European Union removed the country from an economic black list, citing the government’s commitment to reforming its passport program. (As of March, Dominica remains on a so-called gray list.)

Still, some worry that recent discounts for some passports and a growing applicant pool will drive CBI programs to cut corners. David Jessop, former head president of the London-based nonprofit Caribbean Council, wrote last November that growing competition among the citizenship-by-investment programs risked “becoming a dangerous race to the bottom.” He cited “the sometimes-questionable comments and defensive public relations exercises undertaken by some agents selling CBI programs” and “the questions that remain about the due diligence processes some governments pursue.”

Last year, as part of efforts to raise money to rebuild infrastructure heavily damaged by Hurricane Maria, some Caribbean nations began to drastically cut their passport fees. In Dominica, Antigua, Barbuda, and Grenada, an investor passport can now be obtained through a $100,000 donation to a national fund. And investors seeking to obtain citizenship from Dominica, Saint Kitts, Antigua, or Grenada also have a new option: For an investment of at least $200,000 into a government-approved real estate project, a customer can obtain a passport for about $50,000, half the typical price.

(Paolo Zampolli, a businessman who holds an honorary ambassadorship to the U.N. from Dominica–and who takes credit for introducing Donald Trump to Melania Knauss in 1998–has also claimed some credit for kickstarting this newer passport option: He introduced Dominica’s ambassador to the U.S. to the head of Dubai-based Range Developments, a property firm that now markets the real estate investment program in Dominica and Saint Kitts.)

Scott’s Head, Dominica [Photo: Konstantin Krismer/Wikimedia Commons]
In Saint Kitts, the application process now typically takes three to four months, but an accelerated process also allows clients a guaranteed outcome—including issuance of the passport— in 60 days or fewer. In October, after other impacted islands lowered their prices, Saint Kitts also set up its own Hurricane Relief Fund and reduced the price of citizenship through its real estate investment option, from the standard of rate of $150,000 to just $75,000 for a family of four.
The new fund has brought in record numbers of applicants: Over a five-month period, according to rough statistics released by the prime minister, the island of 50,000 people attracted 1,200 investor passport applications. In April, the head of Dominica’s CIU program said that the country had seen between 1,500 and 2,000 applications over the course of the last year.

The Saint Kitts fund was “a win-win for applicant and country,” Micha Emmett, CS Global Partners CEO, said in a press release. But Douglas, the former prime minister, blasted it as “a blatantly opportunistic move”: Since Saint Kitts had emerged relatively unscathed from Hurricane Maria, the fund had effectively undercut recovery efforts on other islands, he argued.

Opposition parties in both countries continue to raise questions about the programs, including about how much revenue they have earned and where that money is. As of 2014, Saint Kitts’ Sugar Industry Diversification Fund, to which most aspiring citizens had donated, had reached $1.5 billion in Eastern Caribbean dollars, or about U.S. $550 million. However, according to an estimate by Dwyer Astaphan, former minister of national security and tourism, the total donations to the fund should have amounted to a number closer to around $611 million. The discrepancy is due to the passport agents’ override commissions, he alleges, estimating that passport consultants have pocketed some $61 million.

The programs and accounts of the sugar industry fund remain under an independent review, a spokesperson for Harris said it in a statement. “Final numbers have not yet been determined, and as such, any suggestion of a discrepancy is at best, premature.”

In Dominica, opposition leaders have also cited a gross discrepancy between the passport revenues publicly reported to the Treasury—around $9 million between 2014 and 2015—and likely estimated revenues of $30 million that year. Representatives for Dominica’s passport program did not respond to requests for comment, but a spokesperson for CS Global said that all funds received under the program are “regularly outlined and reviewed by Parliament for distribution in the national budget.”

Dominica and Saint Kitts also do not disclose comprehensive data about their normal or diplomatic passport holders. For instance, Dominica’s January 2017 Official Gazette listed the 2011 passport recipients: 288, compared with a total island population of around 80,000. In February 2017, as revelations emerged that the government had sold diplomatic passports to alleged criminals, public frustration over the passport sales boiled over into violence. After demonstrations in the capital Roseau deteriorated into vandalism, police in riot gear used tear gas against the crowd.

In the wake of the protests, a number of people were arrested, including an opposition Member of Parliament, an opposition Senator, and two other opposition politicians. Prime Minister Roosevelt Skerrit accused “irresponsible politicians” with the opposition of conducting a “concerted and orchestrated campaign against the citizenship by investment program.” Skerrit also promised reforms to the way the country reviews prospective citizens, and expressed regret, he said, “at the unfortunate turn of events with respect to a few persons holding diplomatic passports becoming persons of interest to foreign countries and external security organizations.”

Cleaning up the Eastern Caribbean passport mess likely requires larger sociopolitical changes that are unlikely to occur soon. One measure, however, might be close to a quick fix: laws against non-citizens paying for or participating in election activities. Of course, this would still not prevent holders of investor passports from participating. But it might help preclude quickie carpetbagging of the type practiced by firms like Cambridge Analytica.

Meanwhile, both islands’ passport programs continue to flourish, thanks to tight relationships with industry partners. In April, Dominica appointed Nuri Katz as its ambassador to the Russian Federation, whom a government press release identifies as “a founding member of a number of businesses in Canada, Russia, and Ukraine.” (Katz holds a number of passports.) The government’s announcement about his appointment, however, does not mention his occupation, which suggests a conflict of interest: Katz is also president of Apex Capital, another prominent passport firm. The company is currently offering several real estate investment options in Saint Kitts and Dominica.

Ann Marlowe, a visiting fellow at the Hudson Institute, is a writer and financial investigator in New York. Follow her at @annmarlowe.

With additional reporting by Alex Pasternack (@pasternack).