Trump scares wealthy liberals: rich Democrats buy citizenship of other countries, fearing the outcome of the upcoming US presidential election
Worried about the possible return of Donald Trump to power, abortion rights and the general state of the country, wealthy Democrats are trying to play it safe and develop a plan B by buying a second citizenship, reports Dailybeast.
For years, David Lesperance, an immigration attorney who helps wealthy Americans obtain second citizenship, has seen a similar type of clientele: MAGA executive millionaires, Silicon Valley libertarians, crypto investors with money — mostly rich guys who wanted to evade US taxes. But in recent months he has witnessed an unexpected rise in a clientele of wealthy liberals who are terrified of the country's political future and want a plan to escape.
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“I was on vacation two weeks ago. I answered emails and phone calls when I got back,” Lesperance said. I have had nine new inquiries in the last week. I can usually get one or two a week."
So-called "golden visas" (granting permanent residence to an investment program participant) have become a status symbol among the super-rich in recent years. About 30 countries now offer citizenship or residency by investment, which allows people to live and work in another country simply by spending a lot of money there – second citizenship costs anywhere from a few hundred thousand dollars to several million. For a time, the clientele was also quite conservative, driven by fears of an upcoming liberal “wealth tax” or, for the tech giants, an upcoming IPO that would lead to a massive tax event. Now, however, the situation has begun to change dramatically.
Lesperance says the number of liberal-minded clients increased nine to 2021-fold this summer, fueled by everything from the Uvalda mass shooting to the Supreme Court ruling in Roe v. Wade. Mel Warshaw, a tax attorney who occasionally works with Lesperance on these cases, confirmed the increase. And Eric Major, CEO of residency and citizenship firm Latitude, said he saw a surge in Democratic clients for the first time since the January XNUMX Capitol siege.
“There are people who are convinced that this country is filled with crazy Christian fundamentalists and good old boys from the South, and that we are all going to be like that. And so they make plans,” said Mark Hyman, founder of E-2 Visa Solutions, who has observed the same pattern among liberals. “Many people have dual citizenship as a Get Out of Jail Dree card or as a life raft in case America becomes uninhabitable.”
Citizenship by investment schemes began with people trying to get into the United States, not out of it. Canada introduced the first such program in the 1980s, hoping to attract wealthy and talented people to the country. The US, UK, Australia and New Zealand soon followed. These were the main options for investors until the global financial crash of 2007, when European countries launched similar schemes to boost their economies.
Major, CEO of Latitude, said most of his clients in the early days were Hong Kong businessmen worried about a Chinese takeover. Then, as China became the world's economic powerhouse, more and more wealthy clients began to use his services to move abroad.
“They were generating a huge amount of wealth, and just in case something goes wrong or there is a political change, they will look at it from an asset protection perspective,” added Glen Craig of Stanford Knight & Partners, who saw a similar trend. .
The Arab Spring of 2008 also generated a wave of interest from millionaires from the Middle East looking to move to Europe or North America. The stereotype of a golden visa recipient still reflects these trends—a super-rich tycoon from a politically unstable or autocratic country. Vito Maganino, CEO of the Swiss firm Mirabello Consultancy, spoke of a former Gulf customer who drove a golden Rolls-Royce. According to him, during their first meeting, the client forgot to bring the original of his birth certificate, so an assistant was sent for him, who made a three-hour flight in a private jet.
Not every applicant is so rich. Major offers its clients three different investment options depending on their income level. For clients with net worth around $2 million, the easiest choice is the Caribbean, where a family of four can obtain citizenship for less than $200. For those with net worth in the tens of millions, there is Malta, which gives investors access to the entire European Union for $000 million. And for the ultra-wealthy client looking for something even more prestigious, there is Austria, which allows a small number of individuals a year to apply for citizenship, making a "significant contribution" to the country's economy - usually worth more than $1 million.
Despite a significant amount of money, most people seeking a second citizenship do not want to move immediately. Instead, experts say, they're just looking for a plan B.
“The vast majority of customers get it because it's an insurance policy. This is plan B,” said Dominik Volek, head of private clients at investment migration consultancy Henley & Partners. “Rich people want options.”
It helps, of course, that many foreign countries have enticingly low tax rates, though dodging Uncle Sam is not as easy as fleeing the country. The US is one of the few countries that tax citizens living abroad, meaning that Americans generally have to renounce their citizenship to enjoy the full benefits of a tax haven.
Therefore, it is not surprising that more and more people are planning to do just that.
“I would say that one in five US clients I have spoken to in the past two years told me that they are planning to renounce their citizenship in the next five to XNUMX years,” said Armand Tannus, US Vice President. President of Apex Capital Partners.
A surge in the number of Americans seeking a second citizenship began in 2020. Now, according to Patricia Casaburi, CEO of Portugal-based Global Citizen Solutions, most of her clients come from the United States. Wolek said the volume of US customers at London-based Henley & Partners increased by more than 400 percent in 2020, making it the company's largest market. They are currently in the process of opening their first offices in Miami, New York and Los Angeles.
According to a number of experts, the pandemic was the initial driver of this trend. Many countries have barred US travelers from entering the country for a time due to their poor handling of the virus, and wealthy Americans have begun to view their US passport as a hindrance. At the same time, more and more companies began to work remotely.
Jason Swan, senior partner at Holborn Assets, recalled a wealthy couple with a daughter who worked in tech and "didn't want to be tied to any one particular country." With a pair of golden passports, Swan says their daughter will get a visa right away.
But the trend really took hold around the time of the 2020 presidential election. There were a few conservatives who raised concerns about the Biden-era wealth tax, experts say, but it was liberals who freaked out most about Trump's attempt to discredit the election, experts said. Their fears only intensified after January 6, 2021, when five people died in an unprecedented siege on the Capitol.
Major saw a surge in clients concerned about starting a family in the US after the Supreme Court overturned Roe v. Wade. Warshaw is currently helping to relocate a man who doesn't want his children to survive a school shooting or a mass shooting drill.
“A year or two ago these people didn't come to me,” Warshaw said. “But now the floodgates are starting to open.”
Not all of these clients are traditional liberals. Some, Lesperance said, are moderates or Republicans who disagree with the direction of their party under Trump. One couple he works with are a couple of civil servants who have served under the Obama and Bush administrations and were concerned about Trump's recent pledge to chase "rogue bureaucrats" out of Washington. According to Lepserans, they feel they may be persecuted.
What all this means for the country is not entirely clear. Few of these firms' clients actually left the United States; most see it as a kind of safety cushion. But some advisers say the trend is indicative of a greater weakening of democratic institutions and of citizens losing faith in their country.
According to him, the main emotion that Major feels from his clients, regardless of whether they come from Connecticut or California, is nervousness.
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“Are they nervous because they are afraid they might get shot, or because they are African American and something could happen to them, or because they think another civil war is coming. Whatever it is, they are nervous,” he said.
“America is known for its confidence,” he said. “Now there isn’t much of it.”
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