It certainly has been a very active few days in the EB-5 industry, especially with the recent news of the amount of investment resetting to $500,000 immediately and today’s activity in the U.S. Senate, which almost assures that the EB-5 Regional Center Program will be allowed to expire next week on June 30, 2021.

“EB-5 Investment Decreases to $500,000 Effective Immediately – District Court Vacates November 21, 2019, Final Rule

United States Magistrate Judge Jacqueline Scott Corley of the U.S. Northern District Court of California issued an order today voiding the EB-5 Immigrant Investor Program Modernization Final Rule that became effective November 21, 2019. The rule increased the minimum investment amount from $500,000 to $900,000. With the rule no longer in effect, the minimum investment amount for the EB-5 Visa Program has been lowered to $500,000.”

What Does the Court Ruling Mean?

This breaking news ordering a return to $500,000 raises a lot of questions, especially if investors who have US $500,000, but not US $900,000 should still file before June 30th? And if so, what would be the risks to them if they file and don’t succeed?

InvestAmerica’s mission is to make sure our clients and investors chose the safest and least risky path towards their immigration goals, so we want to make investors aware of the immigration risks in filing with a $500,000 investment before making any decisions.

As a firm affiliated with a securities firm regulated by FINRA and the SEC, and with our goal solely being the success of our clients, we would only recommend projects that offer real and transparent protection to investors in the LIKELY event that Judge Corley’s decision is overturned by appeal or injunction by the government, in which case a $500,000 investment will not be adequate to qualify for the green card benefit, regardless of when that investment was made after November 19, 2019.  In such a case, unprotected investors will certainly have their I-526 denied, and perhaps also be unable to have their investment refunded.

Some approaches that may provide certain levels of protection for an investor who is keen on filing before June 30th now that the program is almost certain to lapse as the EB-5 reauthorization bill was not allowed to be presented for a vote in the US Senate today are as follows:

  1. The most conservative way to proceed is to file with $900,000 and continue with it.
  2. A second option is to file with $900,000 and if the investment amount sticks at $500,000, withdraw and refile a new application with $500,000. There should be an understanding in place with the regional center that the funds would be held in escrow and refunded if this happens.
  3. Another option would be to file with $900,000, in case the investment amount sticks to $500,000, then file a supplement to the offering stating the project is accepting investors at the $500,000 investment level and the regional center refunds the $400,000.
  4. A last option is to file with $500,000 and execute a letter stating that the balance of the funds will be remitted within 90 days. In case the investment threshold is solidified at $500,000, then file a supplement to the offering stating the project is accepting investors at the $500,000 investment level and no more investment is required to be made.

Each of these potential strategies carry varying levels of immigration and investment risk, along with other risks which are specific to each individual EB-5 investment you may be considering. We do not specifically recommend any of these strategies and strongly encourage investors to consult with licensed, experienced, and reputable U.S. immigration counsel, investment professionals and other parties independent of the regional center you may be considering to discuss the benefits and risks before finalizing your EB-5 investment.

InvestAmerica focuses on extensive project due diligence, adherence to and compliance with U.S. securities laws, transparency to the investor, and projects structured to protect the interests of investors. Now more than ever, we are proud of what we stand for, and we are here to help you make the best decision with all the information we have.

We are sure you may have plenty of questions regarding the new ruling. We are here to help! Please, do not hesitate to contact our international immigration team. You can schedule an initial consultation via Zoom with us right away, utilizing the following link:

InvestAmerica Initial Consultation

Let’s schedule a call in the next few days to discuss it further. We look forward to speaking with you soon.

We are here for you whenever you ready to take a step on your immigration journey, whatever and whenever it may be!