Introduction: Many people have heard about EB-5 or the Investor Visa available to non US Citizens as a path to US citizenship. This article is being written in accordance with the United States Citizenship and Immigration Services Meeting being held today March 17, 2011 at the California Regional Center.
This article is at a status update on the current status of EB-5’s with USCIS and not meant as a primer for the EB-5 process.
Basic Understanding of the EB-5: Many people are confused about EB-5 and the requirements for each. EB-5’s come in two main forms. One has a requirement of $500,000.00 and the other is $1,000,000.00. These two types of EB-5 are applied through Regional Centers and Individualized Applications. Indeed, 90-95% of EB-5’s go through Regional Centers. Regional Centers are pre approved companies that USCIS has vetted. However, that does not mean that Regional Centers are safer. In fact, some Regional Centers have not returned the monies that were invested with them. I always recommend that if control of the investor’s money is critical that they consider an Individualized EB-5. Regional Centers have their own risks; mainly that you are a passive investor. You do not have control of the money. Your only recourse if something were to go wrong is to sue. For many people, attempting to get an EB-5 represents their entire life savings. Therefore, strong consideration should be done before an EB-5 Application is done.
Targeted Employment Area: Obviously, if you can get something for less why not? Again, there are two different investment amount categories. One is for $500,000.00 and the other is $1,000,000.00. But how do we decide how much is necessary to invest? One big error that many people believe only Regional Centers have access to a reduced $500,000.00. That is incorrect. The determination of the investment amount is not whether you are investing in a Regional Center. What determines the investment amount is whether you are investing in a Targeted Employment Area (“TEA”).
TEA is generally determined by high unemployment, typically 150% of the national unemployment average.
Therefore, you can have the ability to invest $500,000.00 without investing in a Regional Center.
10,000 Conditional Visas per year have never been exceeded: Simply, there are 10,000 visas available per year. Never has that number been exceeded. What does that mean?
First, EB-5’s are not that able to get. If so, the 10,000 would have been exceeded like the other immigration categories.
Secondly, EB-5’s are highly scrutinized and all the elements of the EB-5 application should be met prior to filing. Some of the main reasons that EB-5’s are rejected are shocking. 1) Investment of funds cannot be verified through lawful means. 2) Applicant is unable to justify how the investment will create 10 new jobs. 3) The Applicant claims that they are investing in a TEA but are unable to prove it.
Lastly, based on the available visas per year, if you are a qualified EB-5 investor, EB-5 is a great way for you to enter and remain in the United States.
Two Year Conditional Visa rejections do occur: Getting a Conditional Visa is not a guaranteed Visa. USCIS requires you to retain the two-year conditional visa. Only after 21 months have passed are you able to remove the conditional. In 2010, 17% of EB-5’s were not allowed to have conditions removed and Investors (and presumably their families) were placed into removal proceedings (i.e. deportation). That number has been as high as 38%. Understand that an EB-5 is a promise. It is a promise the Investor makes to USCIS that you will invest into the United States. Should you fail to do so, you are risking removal back to your country of origin.
EB-5 is not the only way to enter the United States: Many people are being lied to. They are being told that EB-5 is the only way for them to come to the United States. I disagree. There are many factors that determine whether EB-5 is the best for you. You must speak with multiple qualified attorneys prior to choosing the EB-5 path.
Hard Numbers: In accordance with the goal of this article, below are numbers provided by USCIS that I think are relevant to EB-5’s:
2010 Regional Center Proposals: 110
Initial Proposal Approvals: 55%
2010 EB-5 Applications: 1955
EB-5 Approvals: 89%
2010 EB-5 Condition Removal Denials: 17%