By Bernard Wolfsdorf
Recent EB-5 decisions offer investors meaningful grounds to challenge excessive source-of-funds demands. They also show why a strong legal argument cannot replace a documented financial history.
The emerging picture is nuanced: several courts have limited USCIS’s inquiries into a currency exchanger’s independent wealth, while other decisions uphold scrutiny of the investor’s own assets, completed transfers, and intermediaries. Two September 2026 rulings—Voja and Tran—make those distinctions particularly important.
Battineni: Limits on tracing, but different results for two investors
In Battineni v. Mayorkas, 752 F. Supp. 3d 195 (D.D.C. 2024), the court rejected an expansive tracing requirement for one investor, including a demand to establish where a third-party lender obtained its funds. But it upheld the denial of the other investor’s petition because the evidence did not adequately establish the lawful source of part of his investment.
The decision supports challenges to excessive upstream inquiries. It does not establish that identifying an immediate payment source automatically satisfies the investor’s burden.
Zhou and Sun: Focus on the investor’s lawful acquisition
In Zhou v. Noem, No. 19-cv-2650, 2025 WL 416152 (D.D.C. February 6, 2025), the court rejected a denial centered on how a currency exchanger accumulated the dollars supplied in an exchange.
Sun v. USCIS, No. 21-cv-1612, 2025 WL 947463 (D.D.C. March 28, 2025), followed similar reasoning. The relevant question was whether the investor lawfully acquired the assets through the transaction, rather than whether she could reconstruct the intermediary’s independent financial history.
These are valuable decisions for investors using currency swaps. Both, however, resulted in further agency proceedings rather than unconditional judicial approval of the petitions. They do not excuse an undocumented exchange or resolve every question about its legality.
Le: The exchange itself must withstand scrutiny
In Le v. USCIS, No. 21-cv-501 (D.D.C. June 24, 2025), the court upheld a denial involving questions about the exchange’s legality and inconsistent licensing evidence.
The distinction matters: asking how an exchanger earned its money is different from asking whether the investor lawfully acquired dollars through that exchanger. Favorable source-of-funds cases do not eliminate the second inquiry. Licensing, applicable foreign law, and the reliability of supporting documents can remain decisive.
Voja: Redeeming an asset does not erase questions about its origin
In Voja v. Noem, No. 25-cv-1761 (D.D.C. September 25, 2026), the court upheld a denial involving treasury-bond proceeds and a $200,000 cash deposit. The investor documented ownership and redemption of the bonds but did not adequately show how they acquired them.
The court rejected a categorical rule limiting USCIS to the investment’s immediate source. Demonstrating that money came from a bond redemption does not necessarily establish that the money used to acquire the bond was lawful.
Voja expressly recognized that tracing demands could become unreasonable. Nevertheless, it is difficult to sustain the broad claim that USCIS can never look beyond an immediate source—especially when the inquiry concerns the investor’s own assets.
Tran: Prove the transfer and explain the intermediary
In Tran v. Mayorkas, No. 24-cv-3171 (D.D.C. September 30, 2026), the court upheld findings that the evidence did not adequately establish a completed transfer to a Hong Kong intermediary or the lawfulness of that intermediary’s business.
A bank had performed the currency exchange; the Hong Kong company subsequently handled the dollars. The court therefore distinguished Zhou, Sun, and Battineni. It did not overrule them.
Tran also expressly left the disputed commingling question undecided. It should not be presented as requiring proof of the lawful origin of every dollar in every intermediary’s account.
The cases reveal distinctions—and some tension
The broad language in favorable decisions should be read alongside the later cases. Three questions require separate answers:
- Source: How did the investor lawfully acquire the investment capital?
- Ownership and transfer: Does the evidence connect that capital to the investment?
- Transaction legality: Were the exchange and intermediary arrangements lawful?
An investor may establish one proposition and still leave another unresolved. Courts also examine the actual grounds for denial; defeating an excessive demand may not overcome a separate, valid evidentiary deficiency.
These district-court opinions are persuasive authorities, not a single nationwide appellate rule. Their discussion of older petitions also must be distinguished from statutory requirements applicable to post-reform filings.
What should investors and counsel do now?
Prepare a financial narrative that explains each material acquisition, conversion, and transfer. Match that narrative to records showing completed transactions, account ownership, and the purpose of each intermediary. Explain discrepancies before USCIS has to infer their significance.
Where foreign licensing or currency restrictions matter, provide a transaction-specific analysis supported by the law applicable when the transaction occurred. Where records are unavailable, document retrieval efforts and offer reliable alternatives.
Preserve legal objections to excessive requests while supplying available evidence that answers legitimate concerns. The administrative burden remains preponderance of the evidence, but judicial review ordinarily tests the agency’s decision against the existing record. A court challenge is strongest when the record already establishes the facts and clearly identifies the legal error.
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