Broker-dealers provide a service to EB-5 project issuers, regional centers, and EB-5 investors by performing initial due diligence on EB-5 projects, and assessing the likelihood of a project’s success. After completion of thorough project due diligence, the broker-dealer may present project documents including marketing and subscription materials, such as investor questionnaires, project operating agreements, and private placement memorandums, which describe the entire investment proposition in detail. A broker-dealer may also manage the process of investor subscriptions to an EB-5 project, beginning with the receipt of subscription documents from the investors, through financing the project with the EB-5 investor’s capital.
EB-5 broker-dealers can be engaged by both regional centers and investors in several capacities. Investors sometimes hire broker-dealers to provide them with vetted information on potential EB-5 projects. Broker-dealers can answer investors’ questions about the financial strength of the investment, the risk level with respect to capital repayment, the accuracy of job-creation projections, and other aspects of project due diligence. Regional centers can also hire broker-dealers on a project-by-project basis to find potential investors through referrals. Regional centers may also seek broker-dealer registration, purchase a broker-dealer firm, or otherwise affiliate with a broker-dealer.
The Financial Industry Regulatory Authority (FINRA) is an independent organization which regulates broker-dealers. Investors and regional centers may verify a broker-dealer’s registration status on https://brokercheck.finra.org/.
DISCLAIMER: The information found on this website is intended to be general information; it is not legal or financial advice. Specific legal or financial advice can only be given by a licensed professional with full knowledge of all the facts and circumstances of your particular situation. You should seek consultation with legal, immigration, and financial experts prior to participating in the EB-5 program. Posting a question on this website does not create an attorney-client relationship. All questions you post will be available to the public; do not include confidential information in your question.
