Potential improvements and additional safeguards may be in store for the EB-5 Immigrant Investor Program as U.S. lawmakers attempt to address specific weaknesses that, in the past, have led to abuse and fraud. The EB-5 Reform and Integrity Act of 2021 was introduced in the U.S. Senate on March 18, representing the government’s latest attempt at reforming the program.
The legislation tackles recurring security weaknesses and fraud issues in the EB-5 investor visa regional center program. U.S. lawmakers such as Sens. Patrick Leahy (D-Vermont) and Chuck Grassley (R-Iowa) – who introduced the measure – insist that abuse and exploitation have encompassed the program for years. Examples include foreign investors taking advantage of the program in promptly securing green cards, and U.S. developers deceiving foreign investors by obtaining cash for fraudulent projects.
Foreign investors, U.S. companies abuse program
The EB-5 Immigrant Investor Program was created in 1990 to attract foreign investment in U.S. companies and create jobs for domestic workers. For their part, foreign investors would be able to seek green card eligibility for their workers and families who come to the U.S. in hopes of gaining permanent residency.
The EB-5 program has achieved results in the past several years by creating jobs and increasing economic development. The EB-5 program attracted $20.6 billion in foreign investment and saved or created more than 700,000 jobs during the eight-year period of 2008 to 2015.
However, the positive developments have, sometimes, taken a backseat to the program’s great amount of abuse attributed to both foreign investors and U.S. companies. As a result, the proposed legislation calls for improved accountability and oversight.
For example, EB-5 regional centers must implement disclosure requirements geared toward protecting investors and certify compliance with the rules. In addition, regular audits would take place at the EB-5 regional centers, which also would receive periodic visits from the Department of Homeland Security. Finally, the proposed legislation would give the program a new lease on life since it expires in June.