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How can an investor save money on EB-5 fees?

I understand EB-5 regional center fees can be up to $50,000 and regional centers pay commission to finders or broker-dealers to introduce investors. Will I be able to have the regional center fee reduced if I find and contact the regional center myself? In this case the regional center would not have to pay a finder's fee. Are there any restrictions on an investor contacting an EB-5 regional center directly?

Answers

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    Salvatore Picataggio

    Immigration Attorney
    Answered on

    You may be able to discuss the fees with the regional center you are considering for investment, but many times these fees are set and will be the same for all investors.

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    Julia Roussinova

    Immigration Attorney
    Answered on

    You may approach regional center projects directly to inquire about negotiating administrative fees, but it is unlikely that well-established regional centers will do that. Administrative fees are mostly used to cover the costs of attorney fees, counsel. economist fees, personnel, preparation of business documentation for the project, etc.

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    Jinhee Wilde

    Immigration Attorney
    Answered on

    The administrative fee/syndication fee is the fee that the regional center charges to recoup the attorneys' fees, economists' fees, their staff salaries, overhead, etc., they incur to operate and find the proper EB-5 businesses or projects and prepare all the business documents to be EB-5 compliant. While they do pay some foreign immigration/migration agents the finder's fees, the administration fees are not totally used for this purposes. Further, the EB-5 investment has been found to be a sale of securities within the purview of the Security Exchange Commission; no one other than who has a license to sell securities may accept these commissions. Thus, it would be illegal for the regional center to negotiate lowering of their administration fees, which will be viewed by SEC as giving you, who does not have the investment broker's license, the commission.

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    Fredrick W Voigtmann

    Immigration Attorney
    Answered on

    There are no restrictions on an investor contacting a regional center directly, but not all regional centers will reduce the administrative/syndication fee in the event that there is no finder involved. You should check directly with each regional center as to their policy. Also, make sure that you completely read and understand all offering documents or you should hire an expert to review them for you and explain them to you before you sign anything.

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    Bernard P Wolfsdorf

    Immigration Attorney
    Answered on

    Noone likes to pay fees or commissions, but perhaps the most important point is to focus on choosing a good project that means at least capital preservation and getting an approval. Some might discount, or cut fees, but it is like negotiating with the Mercedes dealer; you do not have much room with a good project. You might be, as they say, penny-wise, but not save anything.

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    Ian E Scott

    Immigration Attorney
    Answered on

    The more established regional centers do not normally pay finder's fees and there are certainly issues associated with these fees being paid to lawyers. You are free to approach a regional center, but most will not negotiate the administrative fee.

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