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Why EB-5 escrows require a nuanced approach

Though many banks claim to meet the escrow needs of EB-5 projects, most lack the specialized expertise necessary to satisfy the diverse demands of EB-5. For many Regional Centers, partnering with a bank without EB-5 experience backfires.

Some EB-5 issuers attempt to work with their existing bank, only for the bank’s risk and compliance departments to decide EB-5 funds are too high-risk. As banks are subject to increasing levels of regulation and scrutiny, they are forced to be more and more selective about the markets they enter and the deposits they take. Because EB-5 funds are international, for many banks, the risks seems to outweigh the rewards.

When this happens, restarting the process of finding a bank both delays project funding and stymies investor recruitment and can be a major setback for an EB-5 project.

In other situations, the bank accounts are already open when problems arise. As funds begin coming in from investors, some banks change their policies and reject funds from certain countries, once again forcing the Regional Center to restart their search for a bank, while also destabilizing the capital raise and immigration processes.

Even in the best case scenario, where the accounts can be opened and the funds are accepted, many Regional Centers find themselves frustrated by the service they receive. Generic approaches not tailored to EB-5 usually fail to offer any visibility of the funds, and the bank’s staff lack the resources and the specialized knowledge necessary to properly service the account.

In contrast, NES Financial’s solutions are tailor-made to meet EB-5’s specific needs. Our legal and client services teams are some of the preeminent experts on EB-5, and our solutions were created to streamline every stage of the EB-5 life cycle.

While most banks offer a one-size-fits-all approach to EB-5 escrows, our EB-5 escrows are built to meet EB-5 process needs. Tailored to the complex needs of EB-5, our escrow solutions take a more intelligent approach to EB-5. By coordinating EB-5 specific solutions with established banking partners who understand the complex nature of EB-5, NES Financial’s Intelligent EB-5 Escrow Solutions simplify a potentially challenging process and provide the utmost in security, transparency, and compliance.

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

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