Hi, I'm Andrew Henderson. I've spent almost a decade learning the right way (and the wrong way) to "plant flags" for greater freedom and prosperity. If you're tired of paying high taxes and being stuck in one place, this blog will show you to how go where you're treated best. We discuss legal ways to pay less in taxes, create wealth faster, and live a life of total freedom. If that sounds good to you, keep reading or get some help.
Dateline: Baku, Azerbaijan
No matter where you obtain a second passport, your place of birth will always matter. I don’t mean this in a sentimental way, but rather as an admission of the limitations that come with obtaining a second passport. For the most part, immigration officials and bank workers in countries all over the world focus on the country that issued you your passport. However, there are still situations in which your birthplace can make a difference — whether you are still a citizen of that country or not.
One of the most drastic examples of this occurred just a few years ago when, in 2014, Canada removed visa-free access for all passport holders of the Caribbean nation of St. Kitts and Nevis. I’ve mentioned this incident before, but we’ve never taken the time to really analyze what it means and how it affects you and the choices you make when it comes to your second passport.
Very few economic passports give you visa-free access to Canada. Besides the European citizenship by investment programs in Malta and Cyprus, St. Kitts and Nevis used to be the only Caribbean economic citizenship program to offer visa-free access to Canada until Antigua obtained it in 2013. The US and Canada are typically off limits for economic citizenship passports, so the travel privilege was a big selling point for the St. Kitts program.
However, St. Kitts lost the privilege due to an incident in which they let an Iranian obtain one of their passports and they didn’t list his place of birth. The man then traveled to Canada and requested an audience with the Prime Minister on a diplomatic mission on behalf of the government of St. Kitts and Nevis. You can certainly understand why Canada reacted the way they did, but it’s unfortunate that it ends up controlling what everyone else does with their passport.
Compliance is key
The US government has long insisted on implementing a system around the world so that no one from a sanctioned country can go and hide or pursue ulterior motives by obtaining a second citizenship. One of the keys to this system is the requirement on all passports to list your place of birth.
It sounds simple, but this is an important thing to keep in mind when you’re looking at any second passport, especially a second citizenship. Compliance is important. The issue is that some of these smaller countries that offer economic citizenship can be pushed around. They’ve got to do what the US government wants. This just means that it can often take more than renouncing your citizenship to free yourself from the reach of the US government. If you don’t want to be a citizen of a country that can be bullied by the US, then you’ll want to make sure that you’re in a good country.
If you have the money, it makes the most sense to get citizenship in Malta, or even Cyprus if you want to invest. If you have 10 million dollars and you want that passport then I would just go for the best. If you have the money and you want an economic citizenship, then I wouldn’t be jerking around with Dominica. Dominica is a great value — if you have a million dollars, $100,000 plus some fees isn’t a big deal. But if you have ten million, then $800,000 (since you get part of your $1 million investment back), plus some fees isn’t a big deal either.
If you can afford the best, then go for the best. Otherwise, you’ll be dealing with limitations that you can actually afford to live without.
Now, I don’t think it’s a huge issue with the Caribbean programs, but don’t think that you can change your identity. Your passport is going to say where you were born. These countries require you to list your birth country because they have to comply. If the US says “Do this.” they have to do it because if they don’t then the US government convinces other countries to limit travel from their passport holders. Getting a passport from a country that doesn’t comply means you’re never going to be able to travel anywhere.
So compliance is important.
The issue with stating your birthplace
For some, this can be a difficult thing to deal with. During Trump’s Muslim ban a French citizen was detained upon entry into the United States. Though a citizen of France, the man’s passport indicated that he was born in Egypt. Consequently, he was interrogated for ten hours and was about to be deported as an illegal alien. It was only because he was going to speak at Texas A&M University that the president of the university was able to help get the situation sorted out at the airport in Houston.
And here’s the most ironic part of the story, the man is an acclaimed Holocaust historian… and a Jew. Not only was this man not from the country that was on Trump’s banned list, but he wasn’t even Muslim. They just assumed that he was Muslim because he was born in Egypt, which is something his passport conveniently communicated to the overzealous airport officials.
On the other hand you have some individuals who will benefit from their place of birth. I have a friend who is originally from France, but he is a naturalized US citizen. If he were to ever give up his US passport, all the passports that he gets after that will say “Born in France” and he won’t have to deal with any issues from being a previous citizen of the United States. On the flip side, there is one benefit from being from the US instead of France: French citizens cannot apply for Comorian citizenship due to a dispute over France stealing their fourth island.
Help me get my economic citizenship!
Permanent US indicia
But here’s the bottom line, your passport is going to say where you were born. If you were born in the United States, your passport is going to say USA for the rest of your life. And what that means is that you have US indicia. So when you go to open a bank account in some country that doesn’t take Americans, like Switzerland, they might well say “Prove that you are no longer a US citizen.” And you’re going to have to bring in the paperwork from the Secretary of State that says you are no longer a citizen, your certificate of loss of nationality.
There may be an occasional time where someone who is uneducated about the policies at a bank will say, “We don’t really care, it says USA, we can’t help you.” That is definitely a possibility. It shouldn’t happen, it’s not in any of the policies. If you’re not a US citizen, you’re not a US citizen. But they have to check anyone with US indicia, which means anyone with a US address, phone number, birthplace, passport, green card, etc. You may occasionally run into someone who’s not fully aware of the policies and they will give you problems.
Here’s the other issue: If I have a passport that lets me go to Iran visa-free, will my birthplace still affect my travel options? Iran is saying that they’re not letting any Americans in as long as Trump is being difficult. Will they let an American in who was born in the United States, but has a different passport? Who knows? Am I going to be subject to the same nonsense and the way they would treat other Americans where I might have a problem? Who knows? That’s definitely something to keep in mind.
Avoid the nonsense, play by the rules
Now, we’ve discussed before that there are some tricks that people use to get around the challenges of listing your birthplace. For instance, I met a guy who, on his Irish passport, put the name of the county where he was born in the US that had the same name as a county in Ireland. I guess that’s a cute way to do it.
It might work, but here’s the deal: sure, if you renounce your US passport and you ask Ireland and they say it’s okay, great. What I wouldn’t do is try and do it as a way to get around rules that are in place. They asked me when I went through the Comoros process if I wanted to put something that was less identifiable and I told them I didn’t want to pull any nonsense. I’m not trying to hide anything.
And, quite frankly, even if I went somewhere with a second passport and they didn’t identify me as a US citizen because my passport didn’t say it, I would still report that bank account to the United States. As a US citizen you’re still liable under US laws, no matter what your other passport says. The US government doesn’t care. You still have to fill out your FBARs, tax returns, report your foreign companies, etc. whether the people who are setting those things up for you know you’re a US citizen or not. So all the cute little tricks that people try to use to change their name and everything else aren’t a good idea in my books. In fact, I recently heard a story of a guy who got indicted for doing that.
Don’t do it.
Help me get my economic citizenship!
Where to get economic citizenship
If you’re from a country that already has a bad reputation, don’t get economic citizenship from the Comoros. If you’re from one of those countries, it might be better to either do economic citizenship in Europe or get a residency and move around in Europe for five years while you wait to be naturalized and then get a passport. It’s sad, but true. I don’t know if being a South Sudanese guy who gets a Dominican passport is going to help you much. It might help you with some travel because they’ll let you in, but I think you will be stopped and questioned at certain banks and other places. So it’s a bit more of a gamble.
If you’re a US citizen it’s not a gamble, just know that people at certain banks are going to ask you to prove that you’re no longer a US citizen if you plan on renouncing. Just understand that there will be examples, like Iran, where there’s still a little bit of risk. Thank the US government for implementing this program. But, wherever you’re from, people are going to know it and some guy at a bank who doesn’t know the rules or some authoritarian guy at a border crossing is going to give you grief. Sorry to say it. We can only help you do the best you can.
Get your economic citizenship & second passport
My goal in doing this series is to help as many people as possible become global citizens by obtaining second citizenship. I live this stuff, in part, so that I can better help individuals like you reduce taxes, obtain a second passport and experience more freedom.
If you’d like to work with me directly to create a wholistic global citizenship strategy, then click here. We’ll go through an entire deep dive process to determine exactly what you need — from passports to residency to where you’re going to live — all so we can get you to your end goals.
If you’re just interested in getting a passport and already know which passport is the right choice for you, then you can go directly to Peter MacFarlane & Associates’ website and contact them by clicking here.
If you’re still determining which approach you should take, feel free to keep reading this series to garner all the knowledge you need to form a vision and actionable plan for the future.
Latest posts by Andrew Henderson (see all)
- Two ways for entrepreneurs to KEEP more of their money - April 26, 2017
- How to use the ’10-10-10 rule’ to make the best decisions - April 24, 2017
- Lessons learned from obtaining economic citizenship - April 23, 2017