This article originally appeared on VICE Greece.
Mrs Yang* had dreamt of visiting the Parthenon ever since she studied Greek mythology at school, so when a real estate agent in her home country of China approached her with an investment opportunity – a three-bedroom apartment overlooking the Acropolis and Syntagma Square, in the centre of Athens – she didn’t think twice.
Mrs Yang invested her life savings into the property, purchasing it for €290,000 (£258,100) in 2018. The flat also came with a massive perk: a so-called “golden visa”, a five-year permit granting her the right to live and work in Greece, plus the right for her and her family to move freely within the Schengen area.
Also known as “immigrant investor programmes”, golden visas are residency permits granted to foreign nationals who invest a large sum of money in a country, usually by buying property. In short, they’re a way for wealthy people to skip the standard requirements asked of immigrants to migrate legally. In some cases, golden visas can also fast-track citizenship.
Currently, 18 countries around the world offer these types of programmes, including eight EU Member States and the UK. In Greece, a golden visa is granted alongside investments above €250,000. The visa can be renewed every five years if the investment is retained. If the investor lives in Greece for seven years, they’re eligible for citizenship – and an EU passport.
One year after the purchase, Mrs Yang left China for Athens, only to discover she’d been scammed. Not only was her apartment overpriced (its true value was €74,000 [£66,300]) and located in an entirely different part of town, but it had also been sold to another Chinese investor after she’d bought it, at the lower price of €250,000 (£224,000). When she confronted her agent in Greece, they asked her to produce a list of documents she didn’t have, to prove the apartment belonged to her.
In October, Mrs Yang filed a joint lawsuit with Mrs Lee, another Chinese investor who’d been swindled through the purchase of a €300,000 home in Glyfada, a seaside suburb of Athens. A VICE World News investigation into the scams suggests Mrs Yang and Mrs Lee’s cases are just the tip of the iceberg – and that Athens might be facing a bigger real estate bubble.
In China, golden visas are big business. According to specialist news site Invested Migration Insider (IMI), immigration agencies dedicated to these investments have boomed since 2002, when the Chinese government loosened regulations. Greece introduced golden visas in 2014, and as of May 2020, the country had issued 7,550 of them – 5,504 to Chinese citizens.
In 2019, the IMI estimated there were over 27,000 Chinese agencies specialised in organising these deals, and that 57,000 Chinese citizens have invested more than €37 billion (£32.9 billion) in golden visas over the past decade. Supported by the Chinese government, these agencies attract investors and put them in contact with foreign agencies, which take care of the practical side of the agreement.
Mrs Yang was approached by one of these agencies and later asked to pay for her apartment via credit and debit card. According to her lawyer, Mrs Yang said she signed a preliminary agreement with the agent in Athens, but not a binding contract of sale. She paid a first instalment of €29,000 (£26,000) when she signed, and settled the rest within a month. Mrs Yang said she was asked to simply swipe her cards on a regular card machine.
A 2014 law banned card payments for the golden visa programme in Greece, since cards can be obtained under fake names and used for money laundering more easily than bank transfers. But in October of 2019, the conservative government in Athens retroactively legalised the payment method, starting from January of 2017.
Opposition parties criticised the decision, accusing the local government of passing the measure to protect two Greek property companies accused of money laundering and tax evasion. VICE World News could not confirm whether the investigation into the companies is still ongoing.
The two companies’ accounts were frozen after an audit found that one had installed card machines at its Shanghai offices and was using them to transfer large sums of money for the purchase of real estate in Greece. The companies’ audit also revealed that the properties were actually leased by one company to the other after they were bought, a tell-tale sign of money laundering.
For instance, a criminal trying to hide cash can buy a property with company A, then rent it to company B. The money would then appear to have been used for a legitimate investment, while in practice being kept in the hands of the same person.
An illustration of Mrs. Lee's flat in Glyfada.
VICE World News asked both the Chinese embassy in Athens and the Greek Ministry of Immigration for comment, but received no response. We also sent questions to Enterprise Greece, the national body under the Ministry of Foreign Affairs responsible for attracting foreign investments. They said they only deal with the “promotion” of the golden visa programme and that our questions did “not fall within the scope of our responsibilities".
Besides Mrs Yang and Mrs Lee, VICE World News contacted a third Chinese national who had paid for a golden visa. All three were from middle-class backgrounds and had lived or studied in the West. They denied they were simply looking for an easy EU passport and said they loved Greece and wanted their kids to grow up there.
VICE World News obtained approximately 300 golden visa contracts registered at the Real Estate and Land Registry Office of Athens. Our research focused on two real estate companies, which bought hundreds of apartments in the centre of Athens between 2017 and 2020, before selling them to Chinese investors. Properties with a market value of €50,000 to €60,000 were sold starting at prices starting at €250,000, and often for much more. The contracts of sale were mostly in the names of the same lawyers and notaries.
We visited three of these apartments in Athens. They were all located in working-class neighbourhoods and were sold for at least twice or three times their market price.
Pictures from outside the three apartments VICE World News visited.
VICE World News reached out to Alexandros Varnavas, a lawyer specialising in Chinese investments and a member of the Investment Migration Council, a Geneva-based federation of professionals in the golden visa sector.
He said some investors are “simply naive” and don’t seek professional advice from an independent lawyer when dealing with agencies in China. Others, however, are aware they are buying overpriced properties just to meet the €250,000 requirement for the visa, and have likely made an agreement with their agents in China to get back a portion of the surplus. What they often don’t know is that their agent’s commission on the purchase might be higher than the sum they’ve agreed to get back later.
In January of 2019, the European Commission wrote a report on golden visa programmes, identifying four risks: money laundering, security of movement within the Schengen Area, tax evasion and a lack of transparency in the visa application process.
When asked for comment, the Commission replied that these risks “are not always sufficiently mitigated” by EU member states. Since the schemes are regulated by national laws, the institution can’t technically get involved, although a committee of experts is “currently working on a joint set of security checks", the spokesperson said.