How the Behring case changes EB-5 and Regional Centers, with Jeff Campion CEO of Pathways -

How the Behring case changes EB-5 and Regional Centers, with Jeff Campion CEO of Pathways

Jeffrey E. Campion. EB-5 immigration attorney and member of AILA, who provides legal representation for EB-5 investors, residency and naturalization through his practice, chats with Ali Jahangiri, the Voice of EB5 host, regarding recent legislation changes, the Berhring case and its effects on Regional Centers.

On this insightful conversation, Jeff addresses investors security, projects elegibility, structure and legislation. 


Ali: Welcome to the Voice of EB-5 podcast by This is your host, Ali Jahangiri, founder and president of EB5 Investors Magazine. Today, I’m sitting down here with Mr. Jeff Campion. We met a long time ago, and he’s a friend of mine. Gonna give you a little bit of intro on Jeff and give Jeff that opportunity to say hi to you all.

Jeff Campion started as an immigration attorney. He actually had clients of his in the immigration space, built his business out in Florida. And his background actually is basically University of Florida College of Law in 1997. And he is one of our members of our EB5 Investor Verified Team. He’s also a member of AILA and a few other organizations. He has been very active in the case, especially the one everyone’s heard about, the Behring case, which we will get into.

Jeff Campion also is the president and owner of Pathways. Pathways is affiliated with 26 states representation regional centers. So right now, his focus is mostly on that. But we’re gonna turn it over to Jeff, make an introduction, and hopefully, ask him some nice questions. Jeff, it’s all you.

Jeff: Well, Ali, thank you so much for your time, I know that you’re a busy guy. So I’m thankful for that, number one, and number two, for your ability just to communicate with the EB-5 ecosystem of what’s going on and where we are. It’s so important people to get the most accurate information so they can make good decisions in every aspect of EB-5. And so I’m thankful for that. And I’m thankful for having met you back in I think 2013 in Shanghai, when there weren’t a lot of us. So it’s a it’s a pleasure and honor to to be here today.

Ali: Thanks, Jeff. I think yeah, I think you’re right, it was around 2013/14 when we met in Shanghai. Wow, things have changed since then. Right?

Jeff: Oh, yeah.

Ali: So, Jeff, let’s get, you know, let’s just talk about a little bit about Pathways, if you don’t mind, first, before we get into the Behring case. I know you’ve been doing business as a regional center for a little bit. Can you talk about… I have, you know, seven different regional centers that you do own that covers 26 states. Can you maybe talk about some of the, you know, types of issues or responsibilities that comes up with being the managing member of the NCE or the running the regional centers?

Jeff: Yeah, yeah. And, you know, so we started in 2012, initially with the Texas Urban Triangle Regional Center. And that was birthed out of the desire to bring projects to the market that we thought would minimize risk and maximize the probability of Permanent Green Card issuance and return of capital. And it was birthed out of just the reality that as an attorney in the space, I had to counsel with clients that they had to choose the best of bad projects back then.

And so we launched that center out there, and then we continue to expand. And I think as part of our DNA is that, you know, we exist for a very specific purpose, we exist to play a small part in changing a person’s destiny for the good. And we leverage EB-5 for that. And so, for us, if an investor doesn’t get his Permanent Green Card and his money back, we feel like we failed.

And so, the biggest challenge for any NCE that’s either that is owned or affiliated with a regional center or is just using a regional center is that, right, is to ensure that you’ve devised a project that will maximize those two things, Permanent Green Card issuance and a return of capital. And so that’s something that I think is the most important and critical issue as it relates to EB-5.

Ali: Thanks, Jeff. Yeah, I think, you know, things have obviously changed a lot and, you know, you obviously grew over the years and kind of morphed into what it is today. You know, with knowing that you’re in the mix, and you have these regional centers that affiliate with the NCEs and bringing in an investment, what is the biggest issue right now you see with the volumes, with the investors, what’s kind of bothering you daily outside of any issues that pop up with legislation, you know, what keeps you awake at night?

Jeff: You know, I think truthfully as an operator, what keeps me awake at night is what’s the next project that we’re gonna do, that we think will be on par with the projects that we’ve done? You know, because I know I’ve said it, but it’s very hard to find a developer that understands what’s on our hearts, which is obviously, we wanna provide capital to the developer. But more importantly, we want a developer that understands we need certain guarantees, or I’m gonna use that word very loosely, right? Because you can’t have guaranteed returns, things of that nature. But we need certain structures in place to feel comfortable that our project will meet our desires for our investors.

And so I think what keeps me up at night, and it does now, right, is I know we’ve got a big project in New Orleans, but all I’m thinking of now is, “Okay. I think if we get the legislation finalized properly with the court system, we’ll be fine with that project. But now, how do we offer another project that is similar in security for our investor?” So I know that sounds maybe trite, but that really is what makes me wonder, you know, will it take me six months a year to find one like that? So that’s really what goes through my mind.

Ali: That’s good to know, it’s interesting how everyone kind of focuses on different things. And, you know, that’s a good place to start with that that’s on your mind. So talking about projects, I know we can’t actively talk about projects right now, due to the fact that, you know, obviously, we don’t sell securities on this podcast. But I do wanna know, you know, Jeff, do you have one or two projects right now on the market? And, you know, what’s currently out there right now in your focuses, do you have a couple of team members out in Asia, you know, give us a little bit of a, you know, as of today, kind of snapshot.

And I only say this so that… we don’t promote any projects here. But I still wanna see, you know, as of today, what’s going on?

Jeff: Yeah, no, we just have one project right now that we’re focused on. We’ve known the developer now for a long time. And we committed to the developer that we would only take this project, and I think that’s probably for us the best way to handle projects. And so that’s all, we are focused on one project that’s fairly large. And then, yeah, you know, we have people that are in… I just got back myself from Korea and Vietnam, we’ll go back, obviously, Ali, with you guys, in September to Vietnam.

So we’re pretty heavily focused in Korea, Vietnam, and Taiwan. And then obviously, you know, we do have our finder that we work with in China, and I think China could be a good market here, maybe for a few months, until there becomes some sort of a backlog with urban and rural, but for right now, as you know, there is no backlog. So we think that would be a good market for a little bit.

Ali: Yeah. Let’s talk about that backlog a little bit. What’s the backlog since, you know, because we had a backlog in China. Right, Jeff?

Jeff: Yeah. Yeah.

Ali: So what is the backlog right now? What does that look like?

Jeff: You know, I know it’ll sound bizarre, but the way that the RIA is constructed, is that there are now some three new lanes for lack of a better word, which is you’ve got your high unemployment, TEA, you’ve got your rural and you’ve got your infrastructure, and those lanes have zero people in them right now. So someone from China, or Vietnam, or India could file today and have a visa immediately available, whereas someone who filed in 2014, from China, in the old, in the pre-RIA program wouldn’t have a visa necessarily available to them. Right? So it’s one of those things that it seems odd, but it is the truth that the way it’s being implemented by the Department of State is that there is no backlog for those new lanes.

Ali: I was told that there’s, we lost somewhere in the realm of 15,000 to 30,000 visas over the last two years. Have you heard about this?

Jeff: Yeah, yeah, sure. I mean, Guangzhou was closed. You had family based visas that then would flow over to employment base and flowed down EB-5, and those couldn’t be utilized. Yeah, I think we’ve at least 18,000 And maybe another 11,000 this year, maybe.

Ali: Yes. So what do you think about that, I know that there’s a case right now going on, and a few attorneys filed the lawsuit. I mean, should that have happened? Or do we get credit for those?

Jeff: Clearly, you know, I don’t think it… well. I mean, it shouldn’t have happened. I think there should have been some way to preserve those and utilize them moving forward. And there have been some legislators that have proposed a recapture those visas. I think that’s something within the realm of possibility that I think some members of Congress are not opposed to going back and saying, “Hey, those visas should have been utilized, and they should be utilized moving forward.” I really hope it happens, because it seems only fair.

Ali: Yeah, well, speaking of cases and winning cases, let’s jump right into it. Jeff, you know, I felt emotionally charged when you told me, you spent a lot of money in the litigation with Behring case. And I want you to expand on that and talk about, you know, who was involved when you got involved? And, you know, let’s talk about what happened.

Give me a little background first on, you know, the different organizations involved. I know that I USA, and some other groups, coalition, and some other groups are involved. But I lay the framework so we can have this on the podcast so people can hear about it.

Jeff: Yeah. So it really goes back even further. Right? It goes back to the November 2019 regulations, and they got put into effect, we thought they were gonna be stopped. And then from some internal issues going on with the Department of Homeland Security and the President, quite honestly, ultimately, they did implement them.

And so and this is the history because what happened is Laura Reiff and I, we are the co-founders of EB-5 Investment Coalition, we thought that the regs were not valid, we didn’t think they were probably getting in a valid way. And so we began to ask the question of how could we challenge them? And where was the best forum? And we decided that the best form was gonna be Northern California. And then the question was, well, who was best situated to actually be a plaintiff?

And so we have our West Coast Regional Center. But we didn’t have an active project. And so we went around and tried to find someone who had an active project. And Colin Behring had an active project. And so we approached him, and he was willing to put his name on the line. And so we supported that lawsuit through EB-5IC and Pathways, and, obviously, the rights got overturned.

And then you fast forward to June of last year, and obviously, the program stopped. And then we began negotiating with Congress, with Senator Schumer’s office, attempting to get legislation and what came out of that was the RIA. And then, you know, in March, the RIA gets passed with the omnibus. And sometime what, late March, early April, USCIS tells everybody that regional centers are the authorized.

And so I picked up the phone and called Colin, I said, “Colin, we have two choices, either one, I file for my regional center, because now there clearly is immediate harm. The challenge is I need to take probably two weeks to get all the data about my regional center in the harm, that’s option one, or option two is Colin, let’s be co-clients, have joint representation with GT, and we’ll be responsible for the fees.”

And that was agreed to and so the lawsuit was filed as quickly as possible prior to the listening session, because we knew quite frankly, that USCIS wasn’t going to change their stance, they weren’t gonna talk about this. And they’d already been told from staffers in Congress that we were gonna file suit. So we had to do it to try to help the industry.

Ali: Really interesting. You know, I thought about, like, the progression on how this stuff all went down. And I didn’t know about some of these backgrounds. So what’s the involvement with the I USA and the Behring case? Were they involved in this as well?

Jeff: Well, yeah, I mean, but it was a somewhat odd in the sense that I was actually asked not to file a lawsuit and wait until after the listening session. And I said to them, “You understand that USCIS is not a friend of ours. They’ve never been friends of the industry. And the longer we wait, the longer we postpone the inevitable.” And so we filed, you know, immediately, and I think a few weeks later I USA filed out in DC, and then they had their case. Then I think I USA withdrew from that case and then filed a motion intervene in our case out in Northern California, which ultimately was accepted.

Ali: Got it. You know, sometimes it’s good to, you know, I think, chat about some of these things. And because there’s a lot of folks in the industry that wanna know, some details behind it. And so, you know, thank you for, you know, pushing forward and helping out with this, getting the Behring case out on the front, keeping those regional centers. Effectively, what’s the next step? Are they gonna appeal it? Or is this ruling gonna hold? How does that work, Jeff?

Jeff: They’re not gonna appeal it. I mean, I’m pretty sure that’s what’s been communicated to us, there’s not gonna be an appeal. I think they have understood that they’ve lost. The question is, how long can they postpone the correct application of the law, right? The judge issued a preliminary injunction that’s now going on probably four weeks, basically telling them that immediately the regional centers have to be in business, and you have to accept 526s.

As you know, however, after that, they issued the I-956F form, saying you have to file this form before you can… and get a receipt until you can file an I-526, and then they issued an I-526E form.

So they’ve really gone in the face of the judge. And we filed a motion for contempt. And the judge thought, unfortunately, that we were sandbagging the agency because we filed it on a Friday. The reason we filed on a Friday is because on Monday, Tuesday, Wednesday, and Thursday, we kept on telling them, “Please change your guidance, please change your guidance,” and they wouldn’t change it. And so we filled it on a Friday, when finally they wouldn’t change it. We gave them multiple chances.

Well, the judge when he saw that he thought that we were not being too kind to the agency. But that being said, he didn’t make a ruling on our motion, he neither ruled for or against. What he did do, however, is this Thursday, he’s asked for an update as far as relates to our motion to find out where we are with respect to his preliminary injunction. Has USCIS done what they were supposed to do?

In the tragic news of all this, Ali, is that you’ll see that people can’t file 526s and they have kids that are aging out because USCIS hasn’t changed their guidance.

So we think that when the judge finds out that on Thursday that no one has filed a 526 that we know of, because they don’t wanna take the risk. We think he’s probably going to be very upset with the agency, when he finds out the truth is they did actually issue new forms and they did actually not follow his instruction, which is regional centers have to be back in business immediately.

And so that’s kind of where the lay of the land is, except for the fact, Ali, that, as you know, because it was public record, there are ongoing settlement negotiations between the agency and all the parties, including I USA, because they are now a party to this lawsuit. And I hold out hope that we’ll just have a settlement here in a week.

Ali: Interesting. You know, it’s funny, because during over the last 10 years since we launched the company, we have had governmental officials opt into our emails and show up at our events. And they also received the magazine. So USCIS has actually receives a lot of content from us. And so I’m guessing that as this podcast grows, we just launched it this year, they’re gonna be listening in on some of these podcasts.

So, you know, controversy aside, and whatever, if the USCIS was standing in front of you, Jeff, I’m sorry, I’m a little bit controversial here. But what would you say to them? If you’re speaking directly to them, what would you say in your message?

Jeff: Yeah, I would say it’s quite clear that Congress never intended to abolish the existing regional centers. They desire to reform it. And they instituted some issues that are already protections given under the SEC rules anyway, and that every regional center is happy to comply with it. We simply wanna be able to do business, and we simply wanna be able to raise capital, create jobs at no cost to the U.S. government and the U.S. taxpayers and bring in some of the best and brightest of the world.

And why would that be at all controversial? That’s what I would say to them. I just don’t understand why it seems to be so controversial when people are no burden to the U.S., they actually are a benefit and a huge benefit.

Ali: But to juxtapose as someone that sit on their side of the table and say, “Well, the reason why they did this was they wanted to knock out some of the bad actors,” is the usual guess, of why they did this, and create new forms and to eliminate all the regional centers and start from scratch. They wanted get rid of the bad actors. Now, Jeff, how do you think it’s best to get rid of the bad actors if they still own regional centers currently?

Jeff: Well, I don’t know who bad actors would be in terms of just… Look, I mean, we have bad actors.

Ali: Let me clarify bad actors. In their mind, they’re thinking there’s some regional centers that had troubles. Do you agree?

Jeff: Yeah, yeah, yeah, sure.

Ali: So they had troubles and there was troubled founders and owners of some regional centers. Now, I’m not gonna sit here and name names with you, you know, of who that was or maybe some I don’t know, but it was in the news, it’s public information. So how does USCIS clean that up, while at the same time helping the good actors, which is call it 97% of the market? How did they do that with these forms? And was this what they were trying to get at?

Jeff: Yeah, well, here’s what I would say. You have bad actors in the stock market, right? You have MCI World Telecom. You have Bernie Madoff, that’s what the SEC is there for, right? This is not USCIS’s purview, in my mind. This is the job of the SEC. Now, I do agree with them, however, Ali, that they would argue they didn’t have the ability to terminate a regional center if they were a bad actor, you can only terminate for not having economic growth. And so I would say I fully get that, no problem. If there are bad actors that are felons. And it was, you know, recent, I know, there’s some, you know, little time restrictions on that. You may now have that authority. So that’s fine. That’s in there.

Yet, you know, they wanna… So what I would say is this, they have those authorities now to terminate regional centers that have bad actors associated with them. You didn’t need the form to do that, because once you probably get to the RIA, you now unnecessarily are subject to the RIA. So why would you need to have a new form when the law is the new law? It’s like, I mean, if I drive my car, and the speed limit now is 60, not 70, I can’t tell the cop I’m not subject to the 60 mile an hour speed limit posted.

Ali: Yeah, no, well said. That’s great. And I think that this is exactly the conversation that they need to hear. And hopefully, when they’re tuning in, and listening to this is, you know, why do they need all these extra protections where they could just eliminate the bad actors? Right?

Jeff: Well, I guess that’s my point. Now I understand they want the I-956H, so they can do background checks. But once again, you know, Ali, if we’re just talking about mechanics, so I’m not talking… I’m not offended by an I-956H, I don’t mind doing background checks. And I don’t think anybody really does. And if someone does, and maybe they’re a bad actor, that’s not the issue. I would say with 99.9% of the people that are in existence today. All we’re saying is, “We wanna get back to work. So if you wanna do a background check, do it. And if it turns out that I have something that is a bad actor qualifier, then terminate me.”

I guess that’s the point, is that we’re not arguing… I don’t think anybody that I am in do business with and any of my rivals would say, “We’re opposed to being terminated for a bad actor provision if it’s really a bad actor.” I think all my rivals would say, “We’re fine with that. We just wanna go back to work.” And so that’s the bigger issue, Ali, is not the conceptually with the the new rules in the RIA, it’s, “Can I please go back to work? And if I violate the RIA, then come knock on my door.”

Ali: Yep. No, that makes sense. And but as far as the security is concerned, let’s kind of dive into that. I don’t mean to put theoretical questions up there. But if some of these bad actors that we were talking about that, you know, by identification that they’re in the securities world, are they not issuers of securities? And as issuers, does the SEC have jurisdiction over issuers, or do they just have jurisdiction over folks like broker dealers and RIAs?

Jeff: Oh, the SEC, it clearly has power over any issuer. So, broker dealers, obviously are governed by the SEC, but also by FINRA. Right? But as it relates to any issuer of a security, the SEC immediately has jurisdiction. And so that’s what has been a little odd to me, even in all these negotiations, Ali, of me saying, “Yeah, but the SEC already has the ability to come in and do whatever they want if someone has committed fraud, or has had material misrepresentation, the SEC has full authority.”

And I think that’s what has been missed somewhat in all this, with the on the service, you know, in the agency, which is the SEC has always had this authority. Now what they did do, Ali, to be fair, is they made it very clear that you are agreeing that it is a security and you are agreeing to be subject to the SEC acts. I just don’t know anybody who’s a serious player in the space that would say, “We thought we weren’t subject to that.” Did I explain well?

Ali: Yeah, no, that makes sense. And that’s what I kind of thought too, is why is the SEC not the one that’s cracking down? Why should the USCIS be involved in this?

Jeff: Well, it’s even… Yeah, and I would go a step further. They don’t have the resources to understand whether or not somebody has violated SEC rules. And this is not a knock on them. Just like the SEC doesn’t have the capacity or resources to know if someone’s violated a USCIS rule. So it seems odd. I will say this though, I do get it from this perspective, they wanted the ability to terminate regional centers for other reasons in just failure to promote economic growth.

But that’s different than saying, “We’re gonna oversee SEC issues.” What I would have liked them to say is, “If SEC finds out you violated the rules, then we can terminate you.” That to me, would have been a better way to approach it.

Ali: So does that mean now that the H Form, which is the form you file as a principal of a regional center, or anyone that’s material in the transaction. Correct? It’s anyone material or regional center owners is the H form? Is that right, Jeff?

Jeff: That’s right.

Ali: So is that H Form there that goes into a, you know, is it for their knowledge? Is it public information? What exactly does the H Form do?

Jeff: The H Form goes through, you know, questions about relating to ownership. Questions about the owners of those that are that have some sort of control of the organization. So for example, with me, it’s myself, it’s George, who is my COO, and actually one other owner that has no control or ownership, but is a silent owner. And so, but we did all three to be safe. And the purpose of that is to find out, “Hey, do you have any criminal history? And/or, you know, is it a foreign government that owns which they’re not allowed to?” So once again…

Ali: But is a foreign person allowed to? Or is just a foreign government?

Jeff: A resident can, a non-resident cannot?

Ali: They can’t be in control or is at the regional center?

Jeff: They can’t own the regional center.

Ali: But they can be part of the NCE.

Jeff: Yeah, I think so. I think they can be part of the NCE, Ali. Yeah, I think they probably can. They surely cannot own the regional center. That’s the main issue there.

Ali: The main issue is the regional centers. So what’s interesting is the focus, the focal point is the regional center, but not the NCE. Whereas the NCE, I think, makes all the decisions, right?

Jeff: Yeah. And that has been what was always under my skin, is the fact that why are we focusing on the regional center, when if you look at some of these regional centers that actually do lease out or rent out their center, they can’t control what an NCE does. In my mind, if they don’t have actual knowledge, they shouldn’t be punished for the acts of a third party. We don’t do that anywhere. That strict liability, right. So we don’t normally do that anywhere in our system, our judicial system.

So to me, I was always pushing for, unless there’s actual knowledge, if they’re not related, if they’re not commonly owned, you can’t hold the regional center responsible and fine the regional center for the acts of this third party NCE. That being said, that is not how it ended up. And so, yeah, that’s why I think you may find a lot of these regional center operates..

Ali: That’s what they’re trying to do, I think, Jeff, they’re trying to get the regional centers as the gatekeepers?

Jeff: Well, they’re almost deputizing the regional centers to say, “You’re our police.” And that’s wrong. But it is what it is. What it basically did, Ali, I think, is it got rid of a lot of these regional centers that would rent out, they probably aren’t going to want to anymore because of the liability.

Ali: Yeah, are they on the hook for the whole deal? Or what are they on the hook for, Jeff? Sorry for we’re over a little bit in time, but I think this is good content.

Jeff: Yeah, they’re on the hook, and it’s a percentage of how much money is raised, Ali, it’s a big fine.

Ali: Yeah. What’s the fine? I wanna know. Is it like 10% of the raise or?

Jeff: It maybe 10%, Ali, and maybe we can… I don’t have it in front of me or I do have the law right here.

Ali: So, if a deal has issues, and there’s some kind of, you know, situation with the investors and they file a claim with the USCIS, or is it? How does that work? Do we know the details or is it not?

Jeff: We don’t know how it would work. I suppose that maybe USCIS would come, they would do it, because they have to audits, so they come they do an audit, and they look and they say, “Hey, we think this NCE didn’t comply with whatever it is,” you know, whether it be securities rules, or whatever, then they come in, “Yeah, it’s fine’s not equal to more than 10% of the total capital invested by alien investors, and the NCE.

So imagine you have a raise of $100 million, 10%, that’s $10 million. And that regional center, it may not have been related entity raising the money.

Ali: So the regional center is the one that gets fined?

Jeff: Yeah, it says 10%. Yeah, that’s a sanction against regional center.

Ali: There you go.

Jeff: And that was what I was saying, that makes no sense. Unless it’s a related company. Otherwise, it ought to be the NCE. Why are we punishing this third party? Why are we punishing the regional center when it’s not the police? It’s not the deputy of USCIS. But it is what it is. That’s what it says Ali, and that’s why I think you’re gonna have less people doing this leasing of regional centers.

Ali: That’s really interesting. So, with that said, Jeff, this means that the regional center gets the fine. So the regional center is on the hook for anything that the NCE does. So the rental market’s gonna probably decrease, as you said, but then there’s an RIA involved now, which is mandatory, which will perhaps make the investments with another layer of scrutiny, right, they’re gonna look at the investments with a little bit more scrutiny before going out to the market, because RIA has fiduciary duties, correct? Is that how…?

Jeff: Well, that applies when you have related entities from the regional center and between the JCE and the NCE, right? You have to have a third party fund administrator and things of that nature. If you have an NCE and JCE that are not affiliated, you can do audited financial statements. So I think that, you know…

A; Really? I actually didn’t know that. So if the JCE and the NCE are unrelated, then there’s no need for an RIA.

Jeff: Yeah, you don’t need to have a third party fund administrators. You can do audited financial statements. And that makes sense, Ali, because remember, the fraud has taken place. An EB-5 has been when you have a common ownership throughout the chain. That’s where the fraud’s taken place, because you don’t have any third party checks.

Ali: Yeah. So it’s more so, I think… See, I didn’t know they made that distinction in the law. Did they actually go in and specify that if the owner has the common ownership, is that actually in the regulation, Jeff?

Jeff: Yeah, it’s in there. It’s in Section Q of the RIA. And in there, it tells you, you need a fund administrator as you go down Section Q. Then it’s Q sub-4. But if you go through there under 5, there’s a waiver and it’s a waiver required, it’s an auto-waiver and it says the Homeland Security shall waive the requirements for any new commercial enterprise that commissions an annual independent financial audit of the NCE.

Ali: Oh, wow. Okay. So it’s a waiver.

Jeff: Yeah, but it’s an auto-waiver. It’s not even a may be waiver, it’s an auto-waiver. And that’s but, hey, on the I-956F, there’s no place on a 956F to say that you are not related and you want a waiver because you’re new audit statements, Ali, that’s how, you know, the form didn’t even say that.

Ali: Got it. So basically, if you have an owner of a regional center or an NCE that’s separate from the JCE, is it the regional center?

Jeff: It’s the NCE in JCE. So, but that makes sense, Ali, you bought a home, and you got a loan from Bank of America, you don’t own Bank of America, there’s no reason for Bank of America to have to have a third party oversee the loan between you and Bank of America. Same thing here, right?

Ali: So it’s the NCE in the JCE, right, so the NCE separate than the JCE. Therefore, you would not need any RIA involved.

Jeff: Right. What you need is a… well you don’t, it’s, you can have it. Or you can get the automatic exemption, if you’re gonna have audited financial statements.

Ali: And Jeff, what if I owned, let’s just throw this out there, let’s let’s say you’re doing a deal. We know certain regional centers out there that own maybe 5%, or they take points on a deal. Let’s say if you’re a NCE, and you’re lending money to a developer who’s building a hotel, and you say, “Hey, I’m gonna give you this loan. And along this loan, I’m gonna take five points interest in your hotel.” Now they have common ownership in the JCE and call it 5%. And they own the NCE. Do you think that brings it up to a level where this waiver doesn’t make sense or?

Jeff: No, I don’t think so. Because they define the two entities in such a way that it’s, I don’t believe that applies.

Ali: So if they’re taking points on a deal, if the lender is taking points on the deal, I think we could say with some somewhat confidence, they don’t have control before it’s pretty much an arm’s length transaction anyway, and the waiver would apply.

Jeff: That’s right.

Ali: Well, that makes sense. Because, I mean, at the end of the day, it’s the people that make the decisions, right? That’s what they’re trying to knock out with any conflicts of interest?

Jeff: That’s exactly right. And that makes sense. Because, you know, the big frauds took place when you had control and ownership up the chain.

Ali: Yep, that makes sense. Now, Jeff, we did go over by a few minutes. But I think some of this content is gonna be super helpful for our listeners. And, you know, I wanted to turn this over to you for any last statements you have about the industry. I knew you’re coming to Vietnam with us, you’re a speaker there, looking forward to seeing you. But is there any last things you wanted to, you know, tell the public on the podcast?

Jeff: No, I’m just… Look, at the end of the day, all that Laura and I have ever done is tried to get a program that would be workable. And I think that we’re very close, finally. I don’t think it’s perfect, but I think it’s moving in the right direction. And maybe perhaps we can get some other fixes moving forward, you know, that would make the program even more workable. But for now, hopefully in the next week or two, the judge will be very clear with the agency or there’ll be a settlement. And then we’ll be off to the races in Vietnam. And we’ll all be excited of having a regional center program that actually is there functioning and that it is helping the stakeholders that it was intended to.

Ali: Well, keep us updated, Jeff, you seem to have a, you know, absolutely a ton of knowledge on this stuff. And it looks like you have the regulation, like, right in front of you. It’s almost like the Bible. You got it up. You’re looking at different provisions. So anyway, thank you for being on this. And I look forward to seeing you soon.

Ladies and gentlemen, this concludes our podcasts with Jeff Campion. And we will be off to the races soon. Thank you.

Jeff: Thanks, guys. Bye-bye.