EB-5 Compliance Initiative Means a Compliance Plan

After threatening to do this last August, the USCIS Fraud Detection and National Security Directorate (FDNS) is turning its attention to the EB-5 program. FDNS will institute three compliance initiatives – Regional Center audits, site visits and interviews of investors at the I-829 stage.

Site visits are either random and unannounced or based on suspected fraud. This will likely be managed the same way as USCIS’s antifraud enforcement in the H-1B and L-1 visa programs and similar to that for R-1 visas for religious workers, which operates under a separate regulation, but in practical application is the same.

Site visits may present a significant intrusion to the business. USCIS may demand records which must be carefully analyzed and the response carefully made. Based on related experience USCIS will likely want to examine basic financial and tax records, financial analysis, contracts, evidence of job creation, and use of the foreign capital investment, and procedures to ensure compliance with securities laws.

Regional centers will have to keep meticulous records across multiple areas of operation and continue diligent maintenance practices and associated record keeping.  Advance planning and training are essential to enhancing success when USCIS comes calling.

Interviews for I-829 applicants will be mandatory for those selected. The first interviews will be virtual (i.e. Skype).  Investors will be questioned about job creation and the allocation of their investment. The investor may be accompanied by a regional center representative and counsel.  Regional centers will need to provide investors with updates and considerable documentation.

Randomized visits will also become routine. Having an audit of your business and establishing a compliance plan are essential. Lawler & Lawler is experienced in this area and can guide you as you prepare for compliance and to represent you in the event of a site visit.

Rollercoaster Processing Time Reports

Usually USCIS will list the posted timeframe in months as its average processing times. The posted time for I-526s has hovered between 15 to 18 months for some time. Sometimes when USCIS has extended processing delays, they will start posting the filing date of the last case that the office completed before updating the chart.

Recently, USCIS posted a processing report showing it is processing I-526s filed on August 12, 2015. This has caused confusion and led many investors to think their cases filed in August and September of 2015 may soon be granted.

That method of posting is only helpful to us if USCIS processes cases chronologically. However, we know that USCIS has not adhered to the "first in, first out" adjudication policy for I-526s and often adjudicates groups of investors in some projects at one time for processing efficiency. So they may have last approved a petition filed August 12, 2015 in one project, but there are still many more filed before that date still pending. This kind of reporting may result in what appears to be a faster or slower posted processing time than is true in practice.

Our most recent I-526 approvals have been for petitions filed between December 2014 and March 2015 (pending 14 to 17 months).

Martin & Tammi