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How does the SEC define U.S. person in terms of EB-5 sales regulations?

I am contemplating raising EB-5 funding for my CRE project through a regional center, and finding the learning curve daunting. I was recently approached by a salesman who claims to be able to find and place investors into an EB-5 project for a fee per investor. I am aware of the SEC''s regulations governing overseas sales activities if the salesman is a U.S. person. He is a U.S. citizen living in the Middle East, and traveling to the U.S. only on occasion. Is he subject to the SEC''s regulations and required to register or affiliate with a broker dealer, or is he not subject to SEC jurisdiction because he is living overseas? How does the SEC define U.S. person?

Answers

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    Ed Beshara

    Immigration Attorney
    Answered on

    I would advise you to contact a law firm to assist in advising you how your project may be EB-5-compliant with the U.S. immigration regulations and policies, and the SEC regulations. Based upon the facts you present, the broker dealer who is registered will be able to assist you and the "salesperson" with compliance.

  • Avatar

    BoBi Ahn

    Immigration Attorney
    Answered on

    You should seek the advice of an SEC attorney on these issues. It is indeed a carefully regulated provision and needs the expertise of an SEC attorney familiar with these regulations.

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    John J Downey

    Immigration Attorney
    Answered on

    Proceed with caution and seek the advice of a competent SEC attorney. The rules and requirements are very often on a case-by-case basis. Spending some money now could save you from spending a lot later.

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    Salvatore Picataggio

    Immigration Attorney
    Answered on

    SEC issues are now very important to EB-5 programs, so you would need to coordinate with an experienced securities attorney to review an arrangement like this for both SEC and USCIS compliance.

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