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On August 13, 2015, USCIS held one of its frequently scheduled EB-5 Immigrant Investor Program Stakeholder Engagements, but this time from Los Angeles, California. The changed location is part and parcel of the agency’s efforts to assertively engage in states that have directly benefited from the EB-5 investment program. But for the poor sound quality, this engagement had a fair balance between being informational and instructive on the one hand, and both repetitive and comical on the other. For the benefit of our readers, we have outlined and addressed the main points, issues, and public policy concerns below.
1. EB-5 Program Thriving More than Before: At present, there is $5.5 billion in potential EB-5 investment funds (as measured by pending I-526 petition filings) in future potential investment funds. In the first 3 quarters of 2014 alone, there has been a 50% increase in I-526 petitions. I-829 petitions have reported a 40% increase from last year; and I-924 applications a 30% increase from last year!
2. USCIS Ramps Up Operational Machinery: Between March 2015 and June 2015, the IPO office has processed approximately 1,000 I-526 petitions each month. According to the agency, this increase in case processing has resulted in an 80% increase in its monthly adjudication rate. The IPO office now has 112 employees (along with 4 pending job offers) and is in the process of hiring additional adjudicators. The office expects to have 121 total employees by the end of the fiscal year (i.e. by September 30, 2013) and to hire an additional 20 employees by the end of the calendar year. (Someone should tell Senators Grassley or Leahy that all this additional employment is a great example of EB-5’s indirect job creation!)
3. Processing Times Continue to Lag: Despite the promising indicators offered above, we are pretty sure that, like us and our clients, you are wondering why delays continue to plague the IPO’s office. As of May 30, 2015, USCIS has recorded processing times of 13.4 months for I-526 petitions, 13.6 months for I-829 petitions, and 11.5 months for I-924 applications. Daunting, indeed!
USCIS humbly acknowledged the fact that processing times are indeed longer than the agency desires but also provided rational explanations as to why the lags continue, including re-routing cases; storing them in multiple rooms; assigning them; prioritizing expedite cases. At MSA, we remain cautiously optimistic that with the right oversight team and the additional hires that one of these days, USCIS will indeed get its act together!
4. USCIS Released Another Draft Policy Memorandum: The memo was released on Monday, August 10, 2015. All interested stakeholders were strongly encouraged to read the memo and provide feedback to USCIS no later than September 8, 2015.
5. EB-5 Protocol – Ethics and Integrity to Be Published Soon: The protocol distinguishes between substantive and procedural inquiries. Substantive inquiries would include comments, concerns, and/or questions that impact EB-5 petitions and applications and can include fact-specific inquiries on cases. All substantive inquires must be memorialized and placed in their relevant files. On the other hand, procedural questions will NOT be impacted by the protocol.
6. New IPO Team Being Created: The team will be tasked with ensuring Regional Center (RC) compliance, and reviewing I-924 applications and issuing Notices to Terminate RCs that do not meet the program’s requirements. As a part of this effort, the team will be investigate false claims regarding guarantees and be tasked with various fraud and risk management activities, including auditing financial documents (including business plans); conducting additional site visits both domestic and international; holding RCs accountable for violating existing law; policy; and enforcing EB-5 regulations.
7. GAO Office Released EB-5 Report: The Government Accountability Office (GAO) has released its well-researched and insightful report, Immigrant Investor Program: Additional Actions Needed to Better Assess Fraud Risks and Report Economic Benefits. The report is part and parcel of the overall goal of protecting and improving the integrity of the EB-5 program
8. Insightful Questions and Policy Considerations! USCIS came armed with a list of questions that they were prepared to answer, including the corporate structure of a direct project. As with all Stakeholder meetings, there was an opportunity for comments from the audience and via the telephone. The issue of redeployment of funds and the Draft Policy Memorandum was a popular choice of topic along with the recent admonition on the use of “United States”, “U.S.”, “US”, and “Federal” in EB-5 regional center names.
Peta-Gaye Ricketts is an experienced attorney at Mona Shah & Associates, PLLC. Her EB-5 practice and experience include representing high net worth foreign investors worldwide on complex source and path of EB-5 funds issues before USCIS; preparing amendment filings and filing exemplar petitions; counseling foreign nationals on obtaining green cards through either individual or Regional Center (RC) EB-5 investments, as well as issues related to I-829 Removal of Conditions; working with developers across a variety of industries; and counseling both EB-5 investors and RCs on due diligence and compliance matters.
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