Thursday, May 18, 2017

Reform the Scandal-Plagued EB-5 Visa Program

Its potential for abuse is illustrated by a Trump-family member pitching it as a benefit to Chinese investors..
Nicole Kushner Meyer’s troubling pitch to Chinese investors — invest in her real-estate project, get a U.S. visa — has inadvertently performed a public service: She’s brought much-needed attention to the scandal-plagued EB-5 visa program, and added yet another compelling reason to overhaul it.
Meyer is a higher-up with real-estate firm Kushner Companies and, of course, sister to presidential adviser and son-in-law Jared Kushner, CEO of Kushner Companies until assuming his White House post in January. Meyer recently spent time in Beijing, encouraging investors to help finance One Journal Square, a 1,467-apartment luxury tower in Jersey City, N.J., across the river from Manhattan. The project is slated to cost upward of $400 million. The sweetener for investors is the possibility of obtaining an EB-5 visa.
The EB-5 (employment-based, fifth preference) visa program was established in 1990 as a way to attract foreign capital for domestic commercial projects, especially in depressed areas. To qualify for an EB-5, an investor must invest $1 million in a new commercial enterprise — that is, any for-profit business established after November 29, 1990 — that will create at least ten new jobs for American workers. In “Targeted Employment Areas,” state-designated and Department of Homeland Security–approved areas where unemployment is high, the investment is $500,000.
As a strategy for attracting capital into the country, the idea’s simplicity is appealing. Furthermore, the EB-5 investment threshold is significantly lower than that of similar programs in other countries (e.g., $2.9 million in the United Kingdom) and has fewer strings attached. The U.S. Customs and Immigration Services (USCIS) estimates that, since 2012, the program has brought $8.7 billion in foreign capital into the country and created 35,000 jobs.
However, the program is rife with fraud, both foreign and domestic. With potentially more than $1 million changing hands with every transaction, developers, lawyers, and applicants all have strong incentives to exploit the system.
Read the rest of the story HERE.

If you like what you see, please "Like" us on Facebook either here or here. Please follow us on Twitter here.

No comments: