Cypriot authorities announced on Tuesday (13th October) that they would scrap the country’s very popular and highly successful scheme following a sting operation and news report by Al Jazeera, ‘The Cyprus Papers Undercover’.

The interior and finance ministries posted a statement that the citizenship by investment programme in its current form will be abolished from the 1st November. The decision was made at an emergency cabinet meeting, held shortly after the release of an undercover recording on Monday in which House of Representative President Demetris Syllouris, Akel MP Christakis Giovanis, and several others were filmed appearing to be willing to assist a fictional Chinese businessman in obtaining a passport, despite having money-laundering and bribery convictions. A spokesman added that the motion was proposed by the Interior Minister and the Finance Minister, and that the establishment of a new CIP would be looked into after the completion of a review.

The statement from the office of Cypriot President Nicos Anastasiades went on to say, “The proposal was based on the long-standing weaknesses but also on the abusive exploitation of the provisions of the programme”.

In response, Cypriot Attorney General George Savvidis said an investigation into possible criminal offences would be launched.

“What has been published in the last few hours by the Al Jazeera news network is causing outrage, anger and concern among the people,” his statement read.

Following the posting, Giovanis announced he would resign as an MP, and Syllouris (who is Cyprus’s second-highest ranking state official) said he would abstain from duties from 19th October until government investigations have been completed, apologising for “this unpleasant image conveyed to the Cypriot public… and any upset it may have caused”.

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How the sting unfolded

Posing as representatives of an unnamed Chinese businessman, Al Jazeera’s undercover reporters pretended to be interested in acquiring a Cypriot passport for him. They admitted that the individual had been convicted in his absence after fleeing China, which should have disqualified him as an applicant, however they were repeatedly assured that should not be a problem as long as enough money was invested. MP Christakis Giovani, also one of the island’s most prominent real estate developers, told the undercover reporters he would ensure the deal was done, which Syllouris promised “full support” through the process.

The journalists also met with local lawyer Andreas Pittadjis, who also assured them the problems weren’t insurmountable, while also discussing the possibility of the applicant changing his name to avoid rejection.

“I had a client who wanted to make an investment and couldn’t. But his wife could. I had another who couldn’t but his son could,” the lawyer said. “You cannot make problems disappear. You can solve them.”

The undercover reporters were later questioned about the identity of the prospective applicant, and when they left Cyprus without supplying those details Mr Pittadjis filed a report with the local anti-money laundering unit. He responded that he understood from the outset what was proposed involved criminal activities and that he was “fishing for more details”.

Those featured in the film have all denied wrongdoing. Giovanis and Antonis Antoniou of the Giovani Group said they shared their suspicions regarding the proposed applicant with Pittadjis, while Syllouris also said he was aware of the report Pittadjis had lodged with the authorities.

A spokesperson for the European commission said the report had been watched “with disbelief” in Brussels and that the organisation was considering infringement proceedings. “President von der Leyen was clear when saying European values are not for sale”.

The exposé follows on from Al Jazeera’s previous ‘Cyprus Papers’ documentary in August, when it was alleged that leaked documents revealed 2,500 people, including some convicted criminals, had paid to become citizens of Cyprus.