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On December 12, 2013, the Office of the Inspector General (“OIG”)  for the Department of Homeland Security (“DHS”) released a long awaited report analyzing the United States Citizenship and Immigration Services (“USCIS”) administration of the EB-5 Regional Center program.

Please see previous posts about the investigation.

The report contains four recommendations of which USCIS concurred with three.

Recommendation #1:

 “Update and clarify the Federal regulations to:

  •  provide the U.S. Citizenship and Immigration Services with the authority to deny or terminate EB-5 regional center participants at any phase of the process when identifying known connections to national security and/or fraud risks without compromising any ongoing or potential investigation;
  • make explicit that fraud and national security concerns can constitute cause for revocation of regional center status under 8 CFR § 205.2;
  • give the U.S. Citizenship and Immigration Services the authority to verify that the foreign funds were invested in companies creating U.S. jobs; and
  • ensure requirements for the EB-5 regional center program are applied consistently to all participants.”

Analysis: USCIS agreed to promulgate an interagency regulation within 9 months to address these OIG concerns.  This is contrary to the general practice at USCIS of issuing guidance as opposed to published regulations.  It will be important for stakeholders to participate fully in the notice and comment process while this regulation is being shaped.

Recommendation #2:

“Develop memoranda of understanding with the Departments of Commerce (“DOC”) and Labor (“DOL”), as well as the Securities and Exchange Commission (“SEC”) to provide expertise and involvement in the adjudication of applications and petitions for the EB-5 regional center program.”

 Analysis: USCIS agreed that within 6 months, it will develop and implement an interagency collaboration plan.   This will involve input and collaboration between USCIS, the Department of Commerce and the Securities and Exchange Commission.

Recommendation #3:

“Conduct comprehensive reviews to determine how EB-5 funds have actually stimulated growth in the U.S. economy in accordance with the intent of the program.  If necessary, employ other specialists or work with other Federal agencies to assist and confirm the results.”

 Analysis: USCIS disagreed with this point and does not feel that it is the obligation of the agency to gauge the impact of the program on the U.S. economy.

Recommendation #4:

“Establish quality assurance steps to promote program integrity and ensure that regional centers comply with the Code of Federal Regulations requirements.”

 Analysis: USCIS agreed with this point and will, within a six-month period, establish new guidelines and structures to address program integrity and compliance issues.

 

We will provide a broader analysis of this report dealing with, among other things, the impact on the EB-5 Regional Center program, the impact on current immigration law reform efforts and the impact on the stakeholder community.

Tags: DOC, DOL, EB5 regional center, OIG, SEC, USCIS
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Photo of Laura Foote Reiff ‡ Laura Foote Reiff ‡

Laura Foote Reiff has more than 32 years of experience representing businesses and organizations in the business immigration and compliance field. She is also a business immigration advocate and has long chaired prominent business immigration coalitions. Laura is Co-Founder of GT’s Business and

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Laura Foote Reiff has more than 32 years of experience representing businesses and organizations in the business immigration and compliance field. She is also a business immigration advocate and has long chaired prominent business immigration coalitions. Laura is Co-Founder of GT’s Business and Immigration and Compliance Group which she co-led since 1999. She currently chairs the Northern Virginia/Washington D.C. Immigration and Compliance Practice. Laura is also Co-Managing Shareholder of the Northern Virginia Office of GT, a position she has held since 2010. As a global leader in the business immigration community, Laura has served on the Boards of the American Immigration Lawyers Association, the American Immigration Council, the National Immigration Forum and is currently the Chair of the America is Better Board.

Laura advises corporations on a variety of compliance-related issues, particularly related to Form I-9 eligibility employment verification matters. Laura has been involved in audits and internal investigations and has successfully minimized monetary exposure as well as civil and criminal liabilities on behalf of her clients. She develops immigration compliance strategies and programs for both small and large companies. Laura performs I-9, H-1B and H-2B compliance inspections during routine internal reviews, while performing due diligence (in the context of a merger, acquisition or sale) or while defending a company against a government investigation.

Laura represents many businesses in creating, managing and using “Regional Centers” that can create indirect jobs toward the 10 new U.S. jobs whose creation can give rise to EB-5 permanent residence for investment. She coordinates this work with attorneys practicing in securities law compliance, with economists identifying “targeted employment areas” and projecting indirect job creation, and with licensed securities brokers coordinating offerings. She also represents individual investors in obtaining conditional permanent residence and in removing conditions from permanent residence.

Laura’s practice also consists of managing business immigration matters and providing immigration counsel to address the visa and work authorization needs of U.S. and global personnel including professionals, managers and executives, treaty investors/ traders, essential workers, persons of extraordinary ability, corporate trainees, and students. She is an immigration policy advocacy expert and works on immigration reform policies.

‡ Admitted in the District of Columbia and Maryland. Not admitted in Virginia. Practice limited to federal immigration practice.

Read more about Laura Foote Reiff ‡
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