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The Grapevine has just received word from David Lesperance, the lawyer representing ten wealthy individuals who were seeking Icelandic citizenship in exchange for their investment in the country, that all ten applications have been rejected.
As the Grapevine reported, ten wealthy individuals have applied for Icelandic citizenship stating that if so granted, they would invest their money in the country; in particular, to the renewable energy field. This immediately sparked controversy, as many argued this was tantamount to “buying citizenship”. As others pointed out, non-European residents normally have to live and work in Iceland for seven years before they can qualify for citizenship.
In addition, at least one of the applicants, Aaron Robert Thane Ritchie, ran afoul of the law when he was forced to pay a $40 million fine to the Securities and Exchange Commission in 2008 for his company’s involvement in an illegal late trading scheme.
Grapevine journalist Catharine Fulton sent a number of questions of her own to Lesperance and, early yesterday morning, he responded by telling us “I have just been unofficially informed that our local lawyer will soon be receiving a formal letter of rejection of the 10 applications that I submitted for Icelandic citizenship.”
Lesperance said he found the decision “very disappointing” and essentially accused authorities of having dismissed the applications outright without any real examination. He also claims that releasing the names of the applicants was a violation of Icelandic privacy laws, which raises the question of why he had said in his previously released FAQ, “we felt we were anything but secretive” and “now that the general public is fully aware of this opportunity, we all look forward to an opportunity for all Icelanders to look at the facts”.
The full story on Lesperance and his project will be coming soon in an article written by Fulton for the Grapevine.
Update: David Lesperance has responded to this story. Here are his reactions:

“Disclosure of Specific Applicants’ Personal Information: It was given by me (with the permission of my clients) to the appropriate officials in furtherance of actual applications for Icelandic citizenship. This is private data which is protected by Icelandic law. The disclosure of this protected information to the public was clearly in breach of Icelandic privacy laws (https://www.privacyinternational.org/article/phr2006-republic-iceland ) and it is the responsibility of the Data Protection Authority to impose fines for non-compliance and seek criminal sanctions where appropriate.
To use an analogy, it would not be a breach for there to be a discussion about regarding Iceland’s approach to dealing with a particular medical condition. There would be a breach for hospital officials to publish the names of patient’s who checked into the hospital with that medical condition.”

This, of course, leads us to wonder what, then, Lesperance meant when he said in his previous FAQ that they were “anything but secretive” and looked “forward to an opportunity for all Icelanders to look at the facts”, as one would think the identities and backgrounds of those asking for citizenship in exchange for investment would be relevant information in keeping with full disclosure and looking at facts. In fairness, maybe Lesperance intended to reveal this information himself.
Lesperance adds:

“You may also want to advise Mr. Fountaine [sic] that his statement ‘they would invest their money in the country; in particular, to the renewable energy field’ was an allegation made by person or persons unknown. It is an allegation which I have immediately and repeatedly denied in all written and oral statements. In fact I pointed out the obvious, in that this allegation should have been questioned and ignored immediately given the undisputed FACT that the generation and distribution of Iceland‘s renewable energy are almost completely publically owned and therefore not available for sale to any private person or entity. The small portion (HS Orca) which as previously privatized would be theoretically available for purchase by a private individual or entity EXCEPT that we put a specific EXCLUSION in our investment vehicle from any such investment.”