Will The Changes Affect The Current Programs Or Only New Investors?


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Once the changes are made, any application filed after that date, will need the new fee to be applied. In other words it has to do with the effective date of the application and the effective date of the filing fee regulations. After that date, you will have to pay another couple of thousand dollars as a filing fee.

What Are The Recent Controversies Regarding The EB-5 Program Involving The Securities And Exchange Commission’s Complaint?

The big news a few months ago was that one of the oldest active regional centers located in Vermont, Jay Peak was sued by the SEC alleging a Ponzi scheme that had been going on for 7 or 8 years. They siphoned off, according to the allegations, about $350,000. It was a huge black eye for the EB-5 program. This was one of the main regional centers that had been prominent since the mid-1990s. That case is currently in court in Florida and in Vermont. In Florida, the owner of the regional center allegedly siphoned off somewhere in excess of $50 million according to the complaint.

Ponzi schemes work as long as there is money to pay out old investors with new people buying. When that stopped, then there was no money to pay out and that’s when the whole thing fell apart. Anybody who is interested can Google Jay Peak EB-5 SEC and they will get up to date on what is happening. It’s affected many investors and people who had applied for Green Cards in good faith. A number of them are in limbo now because there was an issue in how they created the jobs. Some projects are finished, but a number of their projects have not.

Can You Tell Me About The South Dakota Attorney General Who Filed Criminal Charges Against The EB-5 Regional Program?

The South Dakota issue is different in that in the Jay Peak case in Vermont; there criminal charges were not filed. It was a civil complaint involving money and projects. In South Dakota, however, it had to do with filing a criminal complaint against the head of the South Dakota project; the indictment covered only $1.2 million which was just part of the missing money.

That’s another case to wait and see what happens and how the results turn out. In the meantime, the person is out on a very small bond of only about $2500. It is another black eye for the EB-5 program and unfortunately there have been a number of them that have come up when people get greedy and create these issues.

Is The EB-5 Program An Honesty Based Program Designed To Bring In Funds?

There are broker dealers who are licensed by the Federal Securities Agencies to offer for sale EB-5 limited partnership interests. They do due diligence reports that assess the financial viability of the project. They will even monitor the payments made by the developers of the projects. Because the investors are becoming more aware and are concerned about getting their $500,000 back, they are looking to projects where they have safeguards against fraud.

Not only is the government concerned but they can only do so much until they see that there is a problem. The projects are going to have to be proactive; they will want to market through someone who is independent and who is overseeing the payment of money. They will want to ensure it is being sold through a broker dealer where there is a due diligence report. Those are projects that have safeguards and are better able to market in China because currently over 85% of all EB-5 investors are from China.

For more information on Effect Of Changes On EB-5 Program, a free initial consultation is your next best step. Get the information and legal answers you are seeking by calling (310) 477-3000 today.

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