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How much of an EB-5 investment must be used on project development?

If I apply for EB-5 and invest into a regional center project, how do I know that the regional center will put all of my investment towards the project itself? Is the regional center required to use 100 percent of an EB-5 investment directly on project development? I know that the funds must be at risk, but can there be a guarantee that my EB-5 money will all be used on the project itself?

Answers

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    Ed Beshara

    Immigration Attorney
    Answered on

    Your EB-5 immigration due diligence on the EB-5 project can be provided by your EB-5 immigration attorney. You also have the opportunity to obtain a due diligence report on the business and investment viability of the project and the principals and developer of the project. This business due diligence, the business plan, economic report and the offering documents to be signed by the investors will show how the EB-5 investors' funds will be committed to the project.

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    John J Downey

    Immigration Attorney
    Answered on

    Your funds must be dedicated to job creation. You should engage your own attorney to review the regional center's documentation to ensure that your funds are allocated properly.

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    Fredrick W Voigtmann

    Immigration Attorney
    Answered on

    The terms and conditions of how the regional center project will use your invested capital are listed in the offering materials, in the agreements, and in the business plan that all must be submitted to the USCIS. If you do not understand how your capital will be spent or placed at risk, then you should consult with a professional who can advise you on these matters. There is no guarantee that the regional center project will use the funds in the manner it promised, but there is no reason for the project to jeopardize I-526 approvals and I-829 approvals by doing something different than it promised and projected.

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    Salvatore Picataggio

    Immigration Attorney
    Answered on

    In the EB-5 project's business plan, the project will provide specific detail about the uses of funds. If the project does not use the funds properly or fails to create jobs, you may have the right to rescind your investment, withdraw, or get a refund. However, this may require you to re-file your I-526 petition with a new project.

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    Jinhee Wilde

    Immigration Attorney
    Answered on

    The full amount of EB-5 investment must be used for the job creation purposes; whether it is called project development or operations management, it is up to each business. As the regional center will be the General Partner of the Limited Partnership that you as an investor will be part of, having a good, reliable regional center that knows how to do the EB-5 project to make sure that the requisite number of jobs are created for the number of investor is very important. Part of the EB-5 compliant business documents that the regional center provides for your I-526 petition will include how the EB-5 funds will be used for creating the jobs and that the EB-5 funds have been fully committed and put at risk.

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    Lynne Feldman

    Immigration Attorney
    Answered on

    The documents you get from the regional center should explain this in detail. If not, find a more reliable regional center.

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    Robert Cornish

    Securities Attorney
    Answered on

    100% is to be used on the project, no more and no less. This does not include the service fee to the regional center, which is usually on top of the investment. There are no guarantees, but whoever with whom you invest, they should have an E&O policy and fidelity bond in place in the event of theft or conversion.

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