NES Financial offers a series of articles written by industry experts addressing key issues today. One such issue — a nightmare scenario to an EB-5 immigrant investor — is the possibility that his or her chosen investment vehicle may encounter legal or financial problems while their visa is still in process. The worst of these cases —for example, those involving mismanaged funds, poor project oversight, or outright theft of investor capital — may result in total loss of the EB-5 investment.

Of course, the Securities and Exchange Commission (SEC) plays an important role in safeguarding potential victims from financial loss of this kind. However, as the authors point out in today’s article — Troubled Regional Centers and Failing EB-5 Projects (Bernard P. Wolfsdorf & Joseph M. Barnett) — overzealous SEC action can also be harmful: the mere presence of an SEC investigation into an EB-5 project (or its overseeing regional center) will itself likely result in delay or failure of the visa case. (“The SEC may ultimately protect the investor’s money,” the authors note, “but it could come at the cost of a green card.”)

The article also outlines procedures for US Citizenship and Immigration Services  (USCIS) oversight of regional centers, and describes the circumstances that may trigger a Notice of Intent to Terminate (NOIT). An NOIT, too, can swiftly derail an I-526 or I-829 petition.

The takeaway: To maximize their odds of success, a prospective EB-5 immigrant investor should always seek the guidance of a dedicated investment advisor when choosing a regional center. (For more on this subject, check out Michael Gibson’s Commonly Overlooked Factors of Importance when Performing EB-5 Due Diligence.) And, if something does go wrong, they should retain experienced EB-5 counsel to best protect the green card case.

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