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EB-5 Financing

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According to data recently supplied by USCIS, there are more than 20,000 I-526 petitions pending adjudication as of the end of March 2016. This is a massive backlog of cases. What are the implications of this backlog to investors, and will processing times improve?
In 2012, we wrote about the risky business of immigration lawyers accepting finder’s fees for selling limited partnership interests in EB-5 deals. For the past several years, securities law violations have been part and parcel of many EB-5 regional center transactions.
My colleagues Alex Hecht and Neal Martin of ML Strategies have published an update on legislative efforts to continue the EB-5 Regional Center Program: EB-5 Regional Center Program Update: As Deadline for Expiration Approaches, Congressional Action Likely.
The recent attacks in Paris and San Bernardino are going to result in an increase in security checks for visa applicants at U.S. consular posts. We also anticipate Congress to at least review the Visa Waiver Program for potential changes, based on President Obama's address to the nation.
EB-5 regional centers and issuers take heed. The Securities and Exchange Commission ("SEC") is pursuing litigation against parties in several EB-5 deals.
While issuers and regional centers are the focus of EB-5 litigation right now and into the foreseeable future, if you are taking direct proceeds as a borrower in a transaction facilitated by an EB-5 regional center or issuer you need to have legal advice on the scope of your liability in a deal.
For alleged EB-5 fraudster Lin Zhong there is a cold winter ahead. A deep freeze. As we expected when news of the case recently broke, the Securities and Exchange Commission (SEC) obtained a court order freezing Zhong’s assets as well as those of her company EB-5 Asset Manager LLC.
As the EB-5 program continues to expand and regional centers have attracted increasing attention from foreign investors seeking to become permanent lawful U.S. residents, there has been a corresponding increase in regulatory scrutiny of EB-5 investments.
What do a $175,000 Sea Ray yacht, a brand new $100,000 Mercedes Benz S-550 and a $55,000 BMW X5 SUV all have in common?
USCIS updated its online list of terminated EB-5 regional centers on October 22, 2015. In the coming two months, regional centers are required to comply with the requirement to file their Forms I-924A in order to update USCIS on relevant job creating activity over the past year.
Private placement offerings are an increasingly active part of the securities business. One especially complicated and emerging area of private placements is the EB-5 Investor Visa Regional Center Program.
Hear from Adam Sisitsky, a member of Mintz Levin’s Securities Litigation Practice, on the three D’s of EB-5 risk mitigation.
The EB-5 regional center program is set to expire today. But the program will get a temporary reprieve through December 11 if, as expected, Congress passes a Continuing Resolution today to fund the government through that date.
With the proliferation of market makers and brokers abroad in the EB-5 space, U.S. issuers need to pay close attention to the Foreign Corrupt Practices Act (FCPA).
Issuers of EB-5 securities are often new to running a deal where they structure and then market an investment product. There is often the perception that because EB-5 deals have potential immigration benefits flowing to investors, federal and state securities laws are not central, and minor violations don’t matter.
There is speculation on the Hill that lawmakers will not take on reforming or improving the EB-5 Program until January 2016. But don't think for a second that lawmakers will simply pass an extension of the Program and indefinitely shelve refashioning EB-5.
EB-5 financing can be a useful tool for developers. But planning and structuring a deal with EB-5 funding takes time. Developers seeking this capital need to balance concerns of senior lenders with those of an EB-5 lender, if EB-5 financing comes into a deal as a loan subordinate to a senior loan.
The Wall Street Journal recently published two articles about the EB-5 Regional Center Program: a blog entry and a front page editorial-like review of the program.
Section 4A(c) of the Securities Act of 1933 ("The 1933 Act"), 15 USC § 77d-1(c), is part of the new crowdfunding regime. The JOBS Act of 2012, Pub. L. No. 112-106, 126 Stat. 306 (2012), created a liability scheme for issuers and intermediaries in an exempt crowdfunding offering.
On August 25, 2015, the U.S. Securities and Exchange Commission (SEC) filed a civil fraud suit against Lobsang Dargey, a Bellevue, Washington-based real estate developer and alleged fraudster, who also happens to be a brother-in-law of tennis star Andre Agassi.
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