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agents who decide to market the project to investors, and finally,
the petitioning investors themselves who decide whether to make
an equity investment into the project which would invest their
money with little interest and a risk of losing the whole investment amount throughout the lengthy the EB-5 process.
In addition to multiple layers of due diligence review,
government agencies would conduct due diligence investigations and site visits any time from filing of an approval of an
investment in a commercial enterprise until the adjudication
of the first I-829 removal of condition for the project. The
recently discussed EB-5 legislation (as of December 15, 2015)
would have required USCIS to perform at least one site visit to
each new commercial enterprise and job-creating entity, which
would include a review for evidence of direct job creation.
The Securities Exchange Commission (SEC) also conducts
investigations on projects based on investigations or reports.
ii. The Investor
Even if the project passes the scrutiny of adjudicator and the
government investigation team, an investor’s I-526 petition
may still be denied if the adjudicator finds issues with the
investor’s source of investment funds.
The EB-5 legislation referenced above would have required
investors to prove that the investment funds as well as any
administrative costs were obtained from a lawful source and by
lawful means. This includes gathering, translating, and collating
many years’ worth of documents for the preparation of a
detailed report on the source and path of the funds.
USCIS imposes a high standard of review that is difficult for
many investors to attain. For example, many banks in China do
not easily print bank statements for clients and have restrictions
on how far back they can issue bank statements. Moreover,
many countries also have strict currency control laws that make
it extremely difficulty to transfer funds abroad.
Some adjudicators measure the source of funds report
based on U.S. standards and find that the records provided
are inadequate or not lack credibility. However, they may not
fully understand how difficult it is for investors to obtain what
adjudicators think are simple documents. For example, it is
extremely difficult to obtain a Notarial Certificate in China.
Intensive background review is required before such a certificate
can be issued. This is much more difficult than the simple
signature of a notary public in the United States.
The standard of review for source of funds is often much
higher than the standard of review for other visa categories.
Because of this high standard of review, source of funds issues
often deter investors from filing I-526 petitions.
b. Stage Two: Consular Processing (CP)/Adjustment of
Status (AOS)
In this stage the scrutiny focuses on the investor and
derivative family’s personal eligibility to immigrate. Like any
other immigrant visa category, all applicants must gather and
submit criminal, military and medical documents to show, by a
preponderance of evidence, that they will not be a threat to the
United States and do not carry any communicable disease.
For Consular Processing, NVC meticulously reviews
the forms to ensure accuracy. Any inconsistencies in the
application, supporting documents, or previously submitted
documents during Stage One may cause delays and heightened
investigations. After the application passes the scrutiny of
NVC, the Consulate conducts a second layer of review of the
documents and then a third review at the interview.
For Adjustment of Status within the United States, USCIS
similarly conducts an in-depth review of the applicant’s
background and history before approving the application.
Overall, obtaining either an EB-5 visa to enter the United
States or an approval to adjust status in the United States is not
easy – certainly not any easier than for other visa categories.
c. Stage Three: Form I-829, Petition by Entrepreneur
to Remove Conditions
The preponderance of evidence standard also applies to this
stage. Similar to Stage One, in practice adjudicators often apply
a much higher stand of review to I-829 petitions.
The I-829 petition requires the investor to prove that his/
her investment funds have created at least 10 qualified full-time
jobs for U.S. workers. In the direct investment or non-regional
center context, a full-time job is defined as 35 hours per week.
Common proofs of employment include payroll records, Form
I-9s and e-Verify. For regional center investments, the investor
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