Questions and Answers > EB-5 Investments

How do EB-5 rules and regulations define "being in the process of investing the required amount of capital?"

I have read that some EB-5 Regional Centers offer a sort of money-back “guarantee” (or an escrow account) if you do not succeed with the I-526 application. Seems to me it is enough to prove that “you have invested or are actively in the process of investing the required amount of capital.” On the other hand, some say that if you choose the direct route, it is not enough to transfer the money to your business and start spending it right after you have been approved. Is there a difference in legal definitions of those two types of investments/commitments?

Answers

• Lynne Feldman

  Immigration Attorney

  Answered on March 20, 2023

  The money must be irrevocably committed when you file the I-526.

• Julia Roussinova

  Immigration Attorney

  Answered on March 15, 2023

  Escrow account agreement conditioned upon approval of I-526 in a Regional Center context or credible 5-year business plan with showing of legitimate expenditures toward EB-5 job creation in a direct EB-5 context should be fine. Hire an experienced EB-5 immigration attorney to prepare your case.

• Bernard P Wolfsdorf

  Immigration Attorney

  Answered on March 15, 2023

  Not really. If there is a guarantee then the money is not really at risk and needs to be placed at risk for the purpose of creating jobs. Escrow is helpful to ensure the money is transferred in accordance with the agreements but it is critical to show in both instances that the money is deployed into job creating activities to qualify for EB-5. Ordinarily, the funds need to be identified. If, for example, currency restrictions prevent the full deployment, then it may be possible to be in the process of investing, but there is always some risk attached to this option.

• Daniel B Lundy

  Immigration Attorney

  Answered on March 14, 2023

  The issue is one of control. When you put the money in escrow, it is subject to release to you or the NCE upon certain limited conditions, and you cannot simply take your money back after filing an I-526E. If it is your own business, you could put the money in the business account, file the 526 petition, and simply take the money back out. To show that the investment is committed, you would have to have spent enough and have contracts obligating you to spend most of the rest by the time you file the 526.

• Belma Demirovic Chinchoy

  Immigration Attorney

  Answered on March 14, 2023

  The funds have to leave your personal possession; a legit escrow account with instructions to release the funds upon I-526 approval is OK. For a direct EB-5, a legit business plan with evidence of actual operations is generally enough to demonstrate you have made an investment.