By Caribbean News Now contributor
ROSEAU, Dominica — One day after Caribbean News Now reported the absence of any progress updates in relation to the citizenship by investment (CBI)-financed Anichi resort in Dominica, the developers, Oriental Developers (Caribbean) Ltd, uploaded recent construction pictures to its website.
This information was conspicuous by its absence at the time of publication of the original article and the Anichi Resort had failed to respond to an earlier emailed request for specific details of current progress.
Currently, according to Oriental Developers, “Due to the topography of the landscape, considerable earthworks had to be completed before the start of any foundation work. Although earthworks started in May 2017, it was subsequently suspended due to the start of the rainy and hurricane season. The construction crew arrived in Dominica at the beginning of the dry season in December 2017, and civil works officially started on January 15, 2018. To date, work has been ongoing on 85,000 square feet of building area, as well as on the retaining wall. Over 50 persons are employed full time on the site.”
Less transparent is the relationship to the project of citizenship consultancy firm, AAA Associates, run by Imran Farooq, who, as previously reported, has a somewhat questionable history in Canada.
According to Oriental, at the time it entered into business with Farooq, he had already been appointed a promoter of Dominica’s citizenship programme.
“This meant that he had passed a thorough due diligence test commissioned by the government of Dominica, which is a condition for such an appointment,” Oriental said.
However, according to our information, the only criterion for being appointed a promoter of Dominica’s citizenship by investment program is an absence of a criminal record. Business practices and/or reputation, which formed the substance of many consumer complaints against Farooq’s Canadian firm, Premier Immigration Company UAE, is not part of any such “thorough” due diligence.
According to relatively mild criticism in a review published online by Canadian Visa Review, “after researching Premier Immigration Company UAE and finding out what they are all about we would not recommend that you use them. They overcharge for their services and will often ask you to make more payments for changed immigration policies that may not even impact your immigration process.”
Oriental said that since it started doing business with Farooq it has received no complaints by clients in respect of him, neither is it aware of any made. However, a simple Google search would have revealed an extensive list of such complaints in relation to his Canadian operation.
Further, according to Oriental, “Mr Farooq is one of over ten agents in the UAE, who have been contracted to promote and sell the shares and suites offered by our real estate development. He remains one of several agents submitting real estate clients from the Middle East region to our project and to Dominica’s citizenship by investment programme.”
What Oriental failed to address is that Farooq’s firm AAA Associates is its exclusive agent for UAE, Lebanon, Pakistan and Afghanistan, as claimed in a very recent press release, not merely “one of over ten”.
Another aspect that has not so far been satisfactorily explained is the presence of an unusual and arguably illegal provision in the form of agreement between Oriental Developers and its “promoter”, which requires economic citizenship applicants to pay a “special price of $165,750” to Oriental notwithstanding that the cost of each “share” in the resort is $220,000.
The balance is financed by “a third party” but in “return for such financing the applicant is required to transfer to the third party all of his shares in Oriental, the return on those shares and the right to reside in the resort consequent upon the ownership of those shares.”
According to Oriental, this characterization is “misleading”.
“First, this agreement was never put into effect and as a result no application was ever processed under or pursuant to it. Second, that agreement and your article do not give the complete picture. Every investor who purchases shares in our project must sign a subscription agreement, which is the cornerstone of the sale. That agreement clearly states that clients must hold their shares for the minimum period in accordance with the Regulations,” Oriental said.
However, it would seem that the existence of a separate subscription agreement only makes matters worse – since the subscriber is required immediately to divest himself of any interest, notwithstanding any such separate agreement to the contrary.
Furthermore, if the agreement referred to was never put into effect, what was the point in creating it in the first place, and who were the legal minds that did so, especially as some have argued that it represents a possible fraud against the government and people of Dominica in that “donations” are diverted into private hands and not the Economic Diversification Fund?
Oriental also attempted to compare this arrangement to the Canadian Residency Program, where banks would lend money to prospective residents to finance the required government bond.
However, the two situations are completely different. In the case of the Anichi Resort, the “subscription” is not financed by a “loan” but represents an outright and immediate divesting of the subscriber’s interest. In the Canadian program, the financing banks are effectively lending against the collateral of a government bond and, more importantly, the government actually receives the money, not some third party.
According to Oriental, Anichi is not the only developer offering such a program; other developers in Dominica are offering similar products, without however identifying such other developers.
The issue of honesty and transparency in regional CBI programs and related developments was recently addressed at the Caribbean Investment Summit 2018 in St Kitts.
In response to a remark by the prime minister of Antigua and Barbuda, Gaston Browne, that citizenship units needed to be on guard against “fake news”, one delegate quipped that people should also be on guard against ‘fake projects’.
A new social media hashtag has been introduced to promote this theme: #keepCBIhonest.