Blog

EB-5 facts: EB-5 funds are heavily scrutinized to prevent money laundering

Myth: EB-5 enables money laundering.

Fact: EB-5 funds are heavily scrutinized to prevent money laundering.

In addition to the detailed source of funds review performed by DHS, the US banking system is regulated to ensure that money laundering does not occur and to identify potential threats.

U.S. banks accepting foreign funds must comply with Know-Your-Customer (KYC), Anti-Money Laundering (AML), and Bank Secrecy Act (BSA) requirements.

In addition, investors are subject to Office of Foreign Asset Control (OFAC) requirements. The OFAC Specially Designated Nationals (SDN) list specifies individuals, businesses, and countries with which U.S. entities are prohibited from doing business based on foreign policy or national security concerns.

All U.S. persons, including banks and EB-5 issuers, are subject to OFAC regulations, and are required to block transactions involving, on behalf of, or in the interest of entities on the SDN list, and must reject any transactions in violations of other sanctions.

For a person included on or linked to the SDN list, attempting to participate in the EB-5 program would be unsuccessful; the funds would be blocked before the initial investment was ever made, and the foreign individual involved would lose access to those blocked funds.

Learn more about common misconceptions about the EB-5 program.

Get More

What is EB-5? Find out more by downloading our EB-5 Solution Kit.

Contact us

Allow us to address your business needs by contacting us, or comment on this post below! We look forward to hearing from you!

2017-02-14T20:30:18+00:00 March 17th, 2016|Categories: EB-5|Tags: , , , |