How Safe Is Your EB-5 Investment?

The safer your EB-5 investment, the better chance it has to not only fulfill program requirements and net you and your family green cards, but it will be more likely to return your investment in a reasonable amount of time.

Although it is a requirement of the EB-5 Program for investments be “at-risk”, EB-5 investors can significantly minimize these risks by taking these factors into consideration.

1. Hire a strong team, don’t rely on the regional center’s in-house team

• The regional center may sell you on using or relying on their business immigration attorneys, economists, financial analysts, or other EB-5 professionals, but you are not their client, the regional center is. That’s why it’s important to conduct your own due diligence with a team not affiliated with the regional center.
• At a minimum, hire an experienced EB-5 immigration attorney to file your I-526 Petition on your behalf.

2. Review the EB-5 documents

• Have you reviewed the operating agreement, the escrow agreement, the business plan, the targeted employment area designation letter, the economic impact studies, the appraisal, the loan agreements, the equity letters from the other sources of capital, job creation projections, and construction schedules?
• How is the investment structured?
• Does the job-creating enterprise have the capacity to payback their loans?
• Do you understand the exit strategy?
• What percentage of the capital stack is comprised of EB-5 capital? Is it more than 30%?

3. Consider, but do not rely on past success

• How many I-526 Petition approvals have they received?
• How many I-829 Petition approvals have they received?
• How many projects have they completed?
• How many investors have invested in the regional center’s projects?
• How many jobs have they created?
• How many investors have gotten their investment capital back?

4. Learn about their job creation methodology

• Is there a job creation buffer?
• Is the regional center using a methodology that has been successful in the past?
• Does the regional center utilize indirect and induced job creation effectively?

5. Visit the project site

• Fly into the U.S. and take a trip to the project site. Where are they in the construction process? Has the regional center team been transparent and honest about the project and where it’s at?

How transparent is the regional center about the process? Are they providing access to all the documents requested in a timely manner? Providing access to these documents and information offers investors a strong protection against fraud.

Learn as much as you can to minimize your risk. Interested individuals can begin finding out more about the EB-5 process and learning about whether they may qualify for the EB-5 visa by filling out our free evaluation below.