Banking and Finance

USCIS Issues Warning Regarding Regional Center Names

 Last week, USCIS issued a warning advising that EB-5 regional centers and related commercial enterprises should not contain the words “United States,” “U.S.,” “US” and “Federal” in their names.  The concern is that using such names may give the false impression that there is a relationship between the entity and the federal government or a federal agency, or that the project has been endorsed by the federal government or a federal agency.  The warning said that these may be deceptive or misleading practices or advertising that could lead to referral to the Federal trade Commission (“FTC”) or the Department of Justice (“DOJ”) for further action.

Such actions could also lead to referral to, or issues with, the Securities and Exchange Commission (“SEC”).  If USCIS is taking the position that these names are misleading, and ultimately the names are meant to attract investors, then the logical result would be that USCIS is taking the position that Regional Centers and related commercial enterprises are misleading investors in their offerings.  And even if the SEC does not get involved, an action by the FTC or DOJ would be a material fact that needs to be disclosed to investors.  Such disclosure would likely be extremely damaging in the marketing process.

USCIS has advised that they are reaching out to regional centers and related commercial enterprises that have “United States,” “U.S.,” “US” and “Federal” in their names to work with them on changing their names.  Failing to heed USCIS’s warning is likely to open up a can of worms that Regional Centers do not want to deal with.

 Omar Hakim is an attorney at Mona Shah & Associates in New York City. The firm is an established source for EB-5, assisting numerous Regional Centers/EB-5 Projects and Investors in navigating this complex, nuanced and constantly changing area of immigration law. Omar offers clients years of experience in corporate finance, the financial regulatory system, securities matters and in general corporate governance matters. Additionally, he is able to draw on his experiences at major federal regulatory agencies and bodies, which includes work at the SEC, the United States House of Representatives Committee on Financial Services, and the CFTC. He earned his J.D. at the University of Virginia; his Master of Laws in Securities and Financial Regulation at the Georgetown University Law Center; and his B.A. in Economics at Georgetown University.

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