Before Lalit Modi, Vanuatu rejected Nirav Modi’s citizenship request: Why, what are its rules

Napat added that people must seek Vanuatu’s passport for legitimate reasons, and not to “avoid extradition, which the recent facts brought to light clearly indicate was Mr Modi’s intention.”

Last week, Lalit Modi made an application to surrender his Indian passport at the High Commission of India, London, saying he had acquired citizenship of Vanuatu. If the citizenship had come through, India would have had to secure Lalit Modi’s extradition before he could face legal proceedings in India.

Before this, Vanuatu had also rejected diamond jeweller Nirav Modi’s citizenship application. What is Vanuatu’s citizenship programme, and why has it tightened scrutiny over who gets its passport? We explain.

What happened with Nirav Modi?

Vanuatu offers citizenship through its Citizenship by Investment (CBI) program, which requires a non-refundable donation or investment. According to the Capital Investment Immigration Plan (CIIP), the amount required for single applicants is $1,55,000 (approximately Rs 1.3 crore), making it one of the most affordable options for acquiring citizenship.

Nirav Modi had tried to secure Vanuatu’s citizenship almost three months before the Rs 13,600-crore banking fraud in the Punjab National Bank (PNB) became public.

The Indian Express had reported in 2018 that Nirav Modi transferred $195,000 in November 2017 from his personal account to one of the 18 authorised agents of the Vanuatu government who facilitate Citizenship by Investment program of the country.

“The purpose of the $195,000 was to pay the application fee for honorary Vanuatu citizenship. However, a Government Financial Intelligence Unit (FIU) probity check found adverse findings against Mr Modi. Therefore his application was not considered by the Government,” Justin Ngwele, managing partner of Vanuatu-based law firm Indigene Lawyers which processed Modi’s application, had then told The Indian Express over email.

Why has Vanuatu tightened scrutiny of its citizenship programme?

The statement by PM Napat on Monday said, “The Government of Vanuatu has significantly strengthened the due diligence aspect of its Citizenship by Investment Programme over the past four years, resulting in a marked increase in applications failing the enhanced scrutiny undertaken by the Vanuatu Financial Intelligence Unit. The improved process implemented several years ago includes triple-agency checks, including Interpol verification.”

Over the years, there have been concerns that pay-for-citizenship schemes help offenders launder money and escape due process in their home countries. In December last year, the European Union revoked a visa-free travel agreement with Vanuatu over its citizenship scheme. “The EU is revoking the visa exemption, which had already been suspended since 2022, because Vanuatu runs an investor citizenship scheme which has resulted in security and migration risks for the EU,” it said in a statement then.

The maternal uncle of Nirav Modi and co-accused in the PNB scam, Mehul Choksi, has taken the citizenship of Antigua and Barbuda through an investment programme. Since then, he has been fighting a protracted legal battle to avoid extradition to India.

The global money laundering watchdog Financial Action Task Force (FATF) has also highlighted the risks of misuse of citizenship by investment programmes. Such schemes can “allow criminals more global mobility and help them hide their identity and criminal activities behind shell companies in other jurisdictions,” the FATF said in a report.

What exactly is Lalit Modi accused of?

Modi, the former IPL chairman and its chief architect, has been under probe by various agencies in connection with forex violations and a Rs 425-crore TV rights deal for the 2009 IPL with World Sports Group.

After attending just one interrogation session with Income Tax and ED sleuths in Mumbai regarding matters related to forex violations, he fled to the UK in May 2010.

Shortly after the IPL 2010 final, Modi was suspended from BCCI after being accused of misconduct, indiscipline and financial irregularities in association with two bids over the two new franchises, Pune and Kochi. The BCCI launched an investigation against him, and banned him for life in 2013 after a committee found him guilty of these charges.

In multiple interviews from London, Lalit Modi has claimed innocence in all these cases.