A Government “cash for visas” scheme has distributed 179 million euro to investment funds since it was established in 2012.

About a quarter of that figure has been given to mixed investments, bonds and real estate investment trusts (REITs).

Last week new legislation was introduced to limit the ability of REITs to bulk-buy new housing developments amid public outcry that the funds were pushing first-time-buyers out of the market.

The Immigrant Investor Programme (IIP) offers residency visas of an initial five years to foreign investors and their families in exchange for a donation of no less than one million euro.

The money is then distributed to projects that are “beneficial for Ireland, generate or sustain employment and are generally in the public interest”, according to the Department of Justice.

The programme, launched in 2012 as a revenue-raising measure following the recession, has raised 862.5 million euro from more than 1,000 investors since then, figures released to the PA news agency show.

Of that, 21% or 179 million euro has been given to investment funds.

A breakdown provided by the Department of Justice, which oversees the programmes, said about 15% of total funding has been given to investment funds, with 5% going to mixed investments, bonds and REITs.

The figures show that the largest share of funding, 272 million euro or 32%, was given to social housing projects.

Investment funds took the second biggest slice, with 179 million euro, or 21% of total revenue raised under the scheme.

Nursing homes received 169 million euro or 21%, the hospitality and tourism sector took 108.4 million or 12%, 38.9 million or 5% went to other property and housing developments, 35.5 million or 4% to healthcare, 24 million or 3% to education, while 35.9 million or 4% went to projects described as “other”.

The Department of Justice declined to release information on specific organisations which have benefited from the programme on the grounds that it was commercially sensitive.

On the distribution of money to investment funds, a Department spokesman said: “The monies invested by the fund on behalf of IIP applicants must be invested in a manner consistent with the programme objectives, with investment in nursing homes, social housing and hospitality projects also featuring within the funds category.

“All funds must be invested in Ireland and must represent equity stakes in Irish registered companies that are not quoted on any stock exchange.

“In addition, the funds and fund managers must be regulated by the Central Bank of Ireland to conduct business in Ireland.”

Since its establishment, the IIP has approved applications from 1,088 Chinese investors, 21 from the US, seven from Vietnam, four from Saudi Arabia and 42 from “the rest of the world”, the Department said

The Department of Justice website says that they are “enhancing the due diligences processes” around the programme, in areas including money laundering and politically exposed persons (PEPs).

The Financial Action Task Force, an intergovernmental initiative by G7 countries set up to tackle money laundering, defines a politically exposed person as an “individual who is or has been entrusted with a prominent public function”.

Their guidelines say: “Due to their position and influence, it is recognised that many PEPs are in positions that potentially can be abused for the purpose of committing money laundering offences and related predicate offences, including corruption and bribery, as well as conducting activity related to terrorist financing.”

Asked what measures are in place to regulate issues such as PEPs and money laundering, the department said no applications have been refused due to being a PEP.

A spokesman said: “The provision of independently produced due diligence is standard for all IIP applicants.

“No applications have been refused due to the applicant being a politically exposed person.

“If during the application review process an applicant is categorised as a PEP, such a classification is not by itself a reason for refusal.

“However, the information is reviewed and used as part of an informed decision-making process.

“The department complies fully with the OECD (Organisation for Economic Co-operation and Development) common reporting standard requirements relating to residency by investment schemes.”

The department did not respond to a question about safeguards against money laundering.

The OECD says that while such schemes “allow individuals to obtain citizenship or residence rights through local investments or against a flat fee for perfectly legitimate reasons, they can also be potentially misused to hide their assets offshore by escaping reporting under the OECD/G20 Common Reporting Standard (CRS).”

The OECD classes high-risk schemes as “those that give access to a low personal income tax rate on offshore financial assets and do not require an individual to spend a significant amount of time in the location offering the scheme.”

A department spokesman said approval of an application under the IIP is not an endorsement of a particular project.

“It means that the investor has been approved and the investment meets the programme’s objectives” they said.

“Key to the programme is that the investments are beneficial for Ireland, generate or sustain employment and are generally in the public interest.

“Applicants must have a minimum net worth of two million euro of which at least one million must be available for the investment.

“It is also essential that the applicants be of good character.

“A successful applicant under the IIP who makes a suitable investment or donation will secure a residence permission in Ireland for them and their qualifying family members.

“This permission allows them to reside, study, and work in Ireland should they choose to do so.

“Their permission remains valid for an initial five-year period consisting of two and three years, subject to meeting the stated criteria.

“Having completed this five years their permission will continue to be renewed for periods of five years.”

The programme does not offer citizenship, although the naturalisation process is open to a person who has resided in the state for a minimum of four years.

PA Media