Fortune recently published an article that spoke about the EB-5 program, focusing mainly on last year’s isolated Chicago Convention Center incident. The article, while long, seemed to completely disregard the vast majority of Regional Centers and projects that are doing things the right way and achieving success.
As is old news by now, the Chicago Convention Center was a project that ended unsuccessfully for investors in terms of them not receiving a Green Card. However, what the article fails to expand upon is that all of the investors were refunded 100% of their subscription funds. Many of them were able to take that money and invest in another EB-5 project.
The reason those investors got their subscription funds back is because a secure escrow structure was used to hold their funds. Although an EB-5 escrow is not required by the USCIS or the SEC, many EB-5 issuers have been implementing escrow structures to provide security to their investors during the lengthy I-526 approval process.
While the article makes it sound as though the EB-5 industry is operating completely unregulated, those of us close to the industry know this is clearly not the case. The USCIS and the SEC have been working together to try to ensure compliance with immigration and securities laws. There are stringent requirements that EB-5 Regional Centers and developers must meet and severe consequences if they fail to do so.
The EB-5 program is the only government job creation initiative that creates jobs at no cost to the U.S. taxpayer. Our company alone has successfully administered the investments of thousands of investors, creating tens of thousands of jobs and driving economic growth in America.
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