EB-5 Investors Now Enjoy Greater Chances Of Immigration And Financial Success Under The New EB-5 Reform And Integrity Act Of 2022

EB-5 Investors Now Enjoy Greater Chances Of Immigration And Financial Success Under The New EB-5 Reform And Integrity Act Of 2022

Immigrant investors pursue the EB-5 visa program to obtain permanent residency status in the United States. Like many immigrants before them, they look forward to the day they gain the right to live and work anywhere in the United States. Applying for the EB-5 visa, however, entails some risk. Investors are not guaranteed that their EB-5 visa petitions will be approved or that their funds will be returned. These outcomes depend on the success of each EB-5 commercial enterprise in promoting economic development and employment creation. EB-5 projects must also remain compliant with the EB-5 Immigrant Investor Program and the United States Citizenship and Immigration Services ("USCIS") regulations.

Potential EB-5 visa applicants should plan carefully before making a capital investment. Over the years, foreign investors have faced isolated instances of fraud and misappropriation of EB 5 investment funds. And to raise the stakes further for investors, geopolitical uncertainty in 2022 has put a strain on the global economy. Commodities prices have surged in many countries. In light of the financial and immigration risks involved, potential EB-5 investors may understandably be hesitant to commit their hard-earned money toward obtaining U.S. permanent residency visas, also known as Green cards.

Despite these challenges, EB-5 investors can significantly increase their chances of immigration and financial success: they should carefully evaluate potential EB-5 investments and work with experienced industry professionals.

To reduce the risk of fraud and protect foreign investors, Congress enacted the EB-5 Reforma and integrity act of 2022 (the "Act"). Signed into law on March 15, 2022, the Act introduced measures to make regional centers and EB-5 participants more accountable to USCIS. The Act requires a higher level of transparency within the EB-5 industry, affecting everyone from fund managers to overseas migration agents. Due to these reforms, EB-5 investment Green Card applicants can invest with a greater sense of security now than at any other time during the 32-year history of the EB-5 Immigrant Investor Program.

Increased Accountability for Regional Centers and Migration Agents

EB-5 Regional centers are granted authority by USCIS to manage funds from multiple investors across various EB-5 investment projects. Under the Act, USCIS will now oversee regional centers' activities more carefully. Greater oversight will make fraud, fund mismanagement, and non-compliance even more unlikely.

These reforms will discourage each EB 5 regional center from taking liberties with its affiliation and loan agreements. The Act will also keep EB-5 industry participants accountable by placing substantial penalties on non-compliance, such as providing inaccurate information. These measures will help protect all regional center investors from losing their investment funds or becoming disqualified for investment Green Cards.


The management of each regional center must notify USCIS before making changes to its business structure or management team. Regional centers are also required to submit annual financial reports to USCIS and to their investors. These reports must show that the regional center is compliant with the U.S. securities regulations that govern EB-5 investments. For investors, the new reporting requirement grants them access to detailed records of how their money is used each year.

These annual financial reports must also be verified, as EB-5 commercial enterprises are now required to retain third-party fund administrators or obtain audited financial statements. This extra step helps ensure that the EB5 investment capital is used by the commercial enterprise to create jobs. And since EB-5 fund administrators are often highly selective when choosing clients, reputable fund administrators are unlikely to accept a suspicious, high-risk, or non-compliant EB5 project. Such a project may also find it difficult to obtain audited financial statements. As a result, EB-5 investors can be even more confident that their capital will be handled Responsibly and with increased transparency by the project in which they invested.

For an EB-5 investor, the possibility of material changes to their EB-5 project represents a major immigration risk. Material changes are significant deviations from an EB 5 investment project's business plan that would prevent its investors from obtaining their Green Cards. Since USCIS has not released a concrete definition of what might be considered a material change, EB 5 investment projects should avoid all unnecessary changes to their business plans.

Historically, however, EB 5 investment projects have had little incentive to avoid such changes. Under the Act, regional centers are now required to notify USCIS of any significant project changes and whether they communicated these changes to their investors. This added layer of oversight encourages the management of regional centers and EB-5 projects to follow through on their business plans.

Under the Act, all promoters marketing an EB-5 project must now register with USCIS. Even overseas migration agents will be required to provide a record of all fees paid by investors. Previously, foreign migration agents working outside the United States were not accountable to USCIS. This lack of oversight made it easier for EB-5 investment promoters to be less transparent with investors.

Additionally, every EB 5 investment project sponsored by a regional center must now submit a Form I-956F "project request" to USCIS before investors can file Form I-526E, the first petition in the EB-5 investment Green Card process. These project requests not only include investment documents associated with the EB-5 project, such as the confidential private placement memorandum but also detail the project's marketing fees and operating plan to demonstrate compliance with U.S. securities regulations. Through project requests, USCIS will be able to monitor regional center activities more closely. The goal is to detect any irregularities or non-compliance early on.


To guard against fraud and fund misappropriation, USCIS will additionally carry out in-person site visits to regional center projects. These visits will help ensure that the reported business activities are actually taking place. USCIS will also audit each EB-5 regional center at least once every five years.

USCIS will also perform more thorough background checks on individuals involved in the EB-5 industry. People with criminal convictions in the past 10 years cannot be affiliated with a regional center. Also, anyone who has been involved in a case of fraud with a liability of more than $1 million is banned from participating in the regional center component of the EB-5 program.


Failure on the part of regional centers to comply with the new requirements of the Act, or to provide truthful reports, will result in severe consequences. USCIS may fine a non-compliant regional center by up to 10% of its raised capital. USCIS may also suspend or terminate regional center licenses and debar (that is, exclude from the EB-5 program) any individuals involved in non-compliance.

Moreover, each regional center will be required to contribute $10,000–$20,000 yearly to support a new integrity fund. This fund will provide USCIS with added resources to supervise the EB-5 investment industry.

Further Provisions to Protect Investors


Even if a foreign national carefully evaluates an EB-5 project before investing, there is still no guarantee of future success. Fraud, mismanagement, or non-compliance on the part of an EB-5 project or regional center may result in the termination or debarment of the project or regional center. Prior to the Act, USCIS was almost certain to deny the EB-5 visa petitions of investors whose regional centers or EB-5 projects were terminated or debarred. To address this risk, the Act includes provisions to protect innocent investors against events that are outside of their control. Investors whose regional centers or EB-5 projects are terminated or debarred are now given 180 days to invest in other EB-5 projects or to have their project affiliate with a different regional center. Innocent investors who take advantage of this provision will not lose their USCIS processing priority dates or the child status of dependent family members.


EB-5 investors who file Form I-829, the final application used to obtain an EB-5 investment Green Card, are no longer required to have created all 10 required jobs at the time of filing. Instead, they can be "actively in the process of creating" jobs. In such cases, foreign investors are allowed one additional year to show that the jobs were created. Before the end of the additional year, these investors must submit another petition showing that the jobs were created and that the project resulted in economic development. This increased flexibility strengthens EB-5 investors' chances of obtaining permanent residency even if job creation is delayed.


When the regional center component of the EB-5 program lapsed on June 30, 2021, USCIS stopped processing regional center applications. The only hope for EB-5 investors in regional center projects was that Congress would reauthorize the regional center program. The Act both reauthorized the regional center component of the EB-5 program and provided protections to investors in case of a future lapse: under the Act, all regional center investors who file I-526 petitions on or before September 30, 2026, are guaranteed to have their application processed even if the EB-5 Regional Center Program lapses once more.

Increased Safety Implies More Expenses for Investors

Under the Act, the minimum investment cost of pursuing an EB-5 investment Green Card has increased. The Act raised the capital investment threshold for projects in a targeted employment area from $500,000 to $800,000. A targeted employment area is a rural or high unemployment location in need of economic development. Of the two classifications, high unemployment targeted employment areas have historically been more popular in the EB-5 program.

These minimum investment amounts apply to all visa applicants in the EB-5 Immigrant Investor Program, regardless of whether they make a direct investment in a commercial enterprise or invest through a regional center.

Additionally, since the new regional center program compliance requirements stemming from the Act will cause a significant increase in the cost to operate a regional center and correctly administer an EB-5 project, it is expected that EB-5 regional centers will raise their administration fees. EB 5 immigrant investor returns are expected to decrease correspondingly.

Concluding Thoughts

Because of the EB-5 Reform and Integrity Act of 2022, foreign nationals can make EB-5 investments with far greater confidence. Under the Act, the EB-5 industry will become more transparent and accountable. These reforms help protect investors against many of the most serious risks associated with EB-5 foreign investments.

As in all investments, however, the EB-5 investment process still entails some risk. Investors must carefully weigh the risks of each prospective EB-5 project, and the immigration services of experienced EB-5 attorneys can be very helpful to EB-5 visa applicants. But now, more than ever, EB-5 investments provide foreign nationals with a safer and more effective way to immigrate to the United States. The Act represents significant progress in supporting investors' goals of getting U.S. Green Cards and safeguarding their funds. At the same time, EB-5 funds continue to promote economic growth in high unemployment and rural areas.


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