It's Official: AVS EB-5 Remains Vietnam's #1 Choice in EB-5 Investor Visas

Okay, it is my last day in Ho Chi Minh, I'm tired, and I'm leaving for Miami at dawn tomorrow so there is NOTHING humble about this bragging:  according to the final 2015 EB-5 approval tally, Vietnam came in at #2 in the world with 280 EB-5 approvals.  We did the math and the average EB-5 family size for AVS EB5 has been 4, so if you are counting investors only, that means that Vietnam had about probably 70 investors approved for 2015.    Without counting our Vietnamese investors who filed I-526s last year and only counting approvals, we had 12.  So that means approximately 15% of all the Vietnamese EB-5 investors approved in 2015 chose AVS EB-5!!   

Who's your Vietnam EB-5 Daddy? (-;

I am leaving this amazing country just days before Vietnam sees its first BIG EB-5 specific event, hosted by the good folks who publish the best EB-5 magazine in the business.  Unfortunately, not ALL U.S. EB-5 purveyors are necessarily "good folks" and as someone who has spent the past six years lovingly cultivating a word-of-mouth EB-5 investor base in Vietnam, this whole "Vietnam is the new China for EB-5" thing is really bothering me.  Vietnam is NOT the "new China" for EB-5.  As the plague of mega-center EB-5 projects is about to descend on Ho Chi Minh for “China V.2”, here's my reality check for everyone who cares:

  • Vietnam's #2 global ranking is insignificant from a marketing/focus point of view.  The China market is SOOOOOO big that it is in its own category.  I did the math, and Vietnam’s total of 280 EB-5 visas in 2015 is exactly 3.4% of China’s total of 8156 EB-5 visas in 2015.  The potential for EB-5 in markets like India, Russia, the Middle East, and the precipitously-collapsing Brazil each have far more accredited potential EB-5 investors than Vietnam.
  • Remember: I explained in yesterday’s blog entry that to get to #2 position in EB-5 usage for 2015, it took approximately 70 Vietnamese EB-5 investors (based upon the average family of four we documented.)  That's $35M, guys.  CHUMP change for Big EB-5; there are but a handful of us among the 700 or so approved (and still existing) EB-5 Regional Centers offering projects capped at $20M EB-5 component or less.  (Note that I said “component”, as in "a small part of something larger"; our first project was already appraised at over $100M when we decided to raise the initial $10M in EB-5, even though the economists told us we could raise several times that amount, based on projected job creation.  As the smattering of us who actually understand how this EB-5 stuff works, job creation is based not only on how many EB-5 dollars but on how many TOTAL dollars in revenues and expenditures.  But the object of Big EB-5 is to use every possible penny of EB-5 capital they can get while reducing their own respective stakes in the project.  (As they say north of Orlando, bidness is bidness.) But my point is that for most megaprojects used to rapidly hauling in $50M chunks of EB-5 money via the China migration agency network, Vietnam’s total EB-5 investment in 2015 could barely pay the Google Ads bill of some of the Big EB-5 projects.
  • China is the only country with an institutionalized and all-encompassing migration agency structure designed to receive direct commissions for sending investors to EB-5 projects, commissions that would be absolutely unlawful under U.S. securities laws if said agents were subject to U.S. law.  But here's the thing:  according to the sharpest securities attorneys I've met, the only thing more illegal than receiving an illegal securities commission is PAYING one.  So far, the SEC has not gone after EB-5 Regional Centers for paying commissions abroad to agents who are not licensed securities broker/dealers in their respective countries (the qualifier is rather silly when you think about it since the nature of EB-5 means that the only businesses which can deliver prospective immigrant investors are those in the immigration business, not those in the investment business!)  But I have to wonder when the SEC will sharpen the knife and go after those entities over which it DOES have jurisdiction, i.e., EB-5 Regional Centers.  (I know, I know, it sends a shudder through the Universe whenever I say this; tomorrow I’ll receive the usual misspelled threats). 
  • SO many EB-5 Regional Centers, large and small, have wined, dined, and paid hefty fees to Chinese migration agents able to deliver in $20M increments, but the massive EB-5 demand that made these scenarios possible is exactly why the market is all but closed (well, except for those rare investors willing to wait years for their EB-5 priority date to become current.)  That scenario is simply not going to happen in Vietnam.  And while the frenzy of local law firms, consultants, and agents in Ho Chi Minh, Da Nang, and Hanoi are certainly spooling up for their turn at charging EB-5 projects marketing fees in the #2 EB-5 market – good for them – forget about the notion of finding an agent who can deliver anything except one investor at a time. Horsefeathers.  Baloney. To paraphrase Dorothy in the Wizard of Oz:  “Toto, I don’t think we are in China anymore…”

The reality is that EB-5, through the dual machinations of gerrymandering to cobble together bogus TEAS and relying on 100% tenant occupancy for job counts, has become a very attractive commodity for Big EB-5.  Cheap money and, thanks to the intricate corporate structures and insulation of true U.S. principals, about as transparent a process as an African dictator's purchase of a new McLaren in Manhattan.  At the end of the day, if things go badly with that whole "risk" thing, investors in Big EB-5 will have no recourse except to litigate their way through a barrage of insulating LLCs crafted together by the brightest legal minds of America's largest law firms, all with the noble intent of protecting their megadeveloper clients.

These folks have sold EB-5 in China like sleazy con men sold Florida swampland in the 50’s, except in this case the resulting devastation to Chinese families forced to leave America after settling is all the more outrageous, as it is amply documented.  Therein lies the problem with the inbound phenomenon of EB-5 marketing bombardment about to canvas Vietnam (AND Cambodia but that’s another story altogether, more ripe with China-like opportunities for the unscrupulous, for sure.)  You see, except in China - and with the possible future exception of India -- EB-5 is not a commodity and it will NEVER sell as a commodity in other global markets!

In my years of EB-5 experience in this small but fascinating market, Vietnamese investors are savvy, work hard, and are NOT dumb.  They DO listen with an open mind, and they are very compelling to present to after spending years speaking before very justifiably jaded Chinese markets.  But rest assured that they will make their EB-5 decision the exact same way it is made by a retiring Briton cashing in on the London flat he bought 20 years ago and is selling for a small fortune.  They will do their homework, they will do their due diligence, and, ultimately, it will be through their trusted relationships via which they select their EB-5 investment.

I’ve spent six years making the 22-24 hour journey from Miami to Ho Chi Minh to find our Vietnamese investors.  I have a relationship with each and every one.   Some are young.  Some are old.   Some BARELY qualified as accredited investors and have trusted us with their life savings to realize their dream of raising their child in America; some have Embraer private jets that can cross the Pacific.  Some call me from college in the U.S.  When the you-know-what hits the fan and they don't have a relative in the U.S. to help them, Bianca, Laura and I become their family.  They have my cell phone.  They get mad at me if I don’t make time for dinner with them when I visit Vietnam.  A colorful bunch of folks, these Vietnamese investors of mine, but they are to me like family and their trust is something I will never take lightly.

That, my friends, is the nature of the EB-5 beast in Vietnam.  So good luck, play nice, and if things don’t go as planned, let the EB-5 retreat from the “New China” be a little less disruptive than the last American retreat from this amazing nation.  As for me, I’ll be sipping my next lemongrass martini in Saigon in about 3 weeks… Hẹn gặp lại , bạn bè của tôi tỏa sang! (-; J

About Yesterday's Good News...

Yesterday I posted an entry regarding some GREAT news we just received regarding the very favorable economic impact report results for our first batch of I-829s.  After reflecting on the fact that the econometrics documented the creation of 50% more full-time-equivalent jobs than originally forecast...I decided to remove the blog.   Why?

Well, humble-bragging aside -- and Bianca and Laura call me on that on a daily basis -- I decided that this news was more like a family celebration than a moment to thump my EB-5 chest.  Accordingly, I have sent each of our original first project investors a personal note conveying the great news and thanking them for having faith in American Venture Solutions EB-5 before we had our first approval and our still-sterling record of I-526 success.

I fully expected the report to reflect ample job creation, but my expectations were dramatically exceeded...and I am SOOOOOO proud that we have been able to deliver for those who trusted us when I was only reluctantly entering this scary world of EB-5.   Today,  prospective EB-5 investors can look at our history of success, transparency, and unwavering compliance with U.S. securities and immigration laws - both inside AND outside the U.S. - and choose AVS EB-5 based upon our record, and that's a great thing.  But to me, the heroes in this whole EB-5 success story will always be those first folks -mostly in Vietnam - who looked me dead in the eye and trusted me when I all I had was a business plan, a Regional Center, and the very best of intentions.

Here's to those willing to take the calculated risks that ultimately generate the success others only dream about! (-;  J

Today's NYT Article on EB-5 Sounds more NY Post than NYT

Sigh.  Even my venerable, beloved New York Times - the second best written English-language newspaper on earth (second only to the UK's consistently brilliant Financial Times) - is vulnerable to the temptation of hype for sake of engaging readership.  Consider the opening line of today's big piece on the EB-5 visa by Ron Nixon:

"The easiest way to gain entry into the United States is not to walk across the border in the dead of night. It is to write a check."

As a former U.S. Visa Officer who, back when dinosaurs roamed the earth, served as Fraud Officer in the U.S. Consulate General in Ciudad Juarez, Mexico, when it was the single largest immigrant visa processing facility on the planet, I respectfully beg to disagree with both Mr. Nixon's opening line and with the nonsense sputtered by Senator Dianne Feinstein and the other always-opiniated-yet-conveniently-clueless folks in Washington bad-mouthing the EB-5 for several reasons:

  1. The process of structuring a legally compliant EB-5 project, navigating the nebulous bureaucracy of ever-changing rules, identifying a vetted, accredited foreign investor and having the investor and family journey through a 3-4 year process fraught with unexpected surprises and with legally-mandated economic risk is NOT easier than hopping the fence at the Rio Grand.  (Well, unless Trump wins and gets his wall, I suppose.)
  2. Besides illegally entering the U.S., there are a zillion other ways to try to get a green card.  (At one point, during the long-forgotten Stateside Criteria program which let foreigners in the U.S. marrying US Citizens process in border posts instead of returning home to their country, we were tracking an 80% marriage fraud rate.  And it didn't take 5 years and a half million dollars, just a notario in Queens with a plaster wedding cake and a Polaroid.
  3. The vast majority of illegal aliens in the U.S. are folks who entered legally and overstayed their visas...visit Miami Beach sometime if you don't believe me.
  4. The EB-5 visa - despite the abuse, the horror stories, and all the bad guys we've heard about -- is providing the SINGLE MOST POWERFUL source of Foreign Direct Investment in the U.S. during an unprecedented timeof global anxiety.  (According to today's NYT article, some $8.7 billion in EB-5 capital has created 35,140 jobs since October 2012...and that's BEFORE EB-5 got in full gear as it is today.)
  5. Jobs by the THOUSANDS have been created in the U.S. via the EB-5 and there is nothing wrong whatsoever with making U.S. residency available to wealthy qualified foreign investors seeking a better life in the U.S. for their family.  Success should NOT, Senator Feinstein, disqualify a person from pursuing U.S. residency.

Today's VERY necessary hearing before the Senate Homeland Security Committee, as described in the NYT article, is indeed a belated response to a much-deferred problem.  The largest and most politically powerful EB-5 Regional Centers have spent millions delaying and deferring the necessary reforms to EB-5 because the economic stakes are too high:  take away the dual fictions of false Targeted Employment Areas (TEAs) cobbled together to permit a luxury highrise to be classified as located in a "disadvantaged" area and absurd logic of crediting 100% of tenant occupancy as "new job creation" and their whole model crumbles:  EB-5 investors will NOT spend $1M on their megaprojects once TEA gerrymandering abuse is eliminated nor will their job creation models withstand a "real world" tenant occupancy calculation (such as the eminently generous 30% proposed by USCIS economists last year and ferociously opposed by Big EB-5).  In short, EB-5 reform means no more cheap money for the megadevelopers who spent millions on lobbyists last year to prevent ANY change to the current system they are milking.

Fortunately, we have folks like Senator Chuck Schumer, Democrat of New York, who actually bother to read the memos and who can distinguish the "wheat" of high-caliber EB-5 programs creating REAL jobs in the rural areas where they are desperately needed and following the letter and spirit of the EB-5 visa as intended by Congress from the "chaff" of monster players in the EB-5 sector determined to perpetuate the abuses which lead to silly opening lines in otherwise intelligent and important articles like today's NYT piece.

It's time for reform and time to level the playing field in EB-5.

Methinks the TEA Manipulators Doth Protest Too Much...

Unfreakingbelievable:  after years of TEA manipulation by big EB-5 developers, the Senate Judiciary Committee finally schedules a meeting very properly titled "The Distortion of EB-5 Targeted Employment Areas: Time to End the Abuse" for THIS Wednesday...and BOOM, they just cancelled it!

What an incredible coincidence, right? It can't possibly have anything to do with, ahem, Big EB-5 lobbyists...can it?

This morning I wrote about how a handful of EB-5 Regional Center heavyweights are basically stalling desperately-needed reforms to insure that REAL targeted employment areas in rural and poor urban areas benefit the EB-5 as Congress ALWAYS intended versus their glitzy highrises in Miami and Manhattan.  This afternoon they once again stall the inevitable.  See for yourself:

Senate Judiciary Committee Delays EB-5 TEA Abuse Reform Meeting

If you care about the TRUE spirit and purpose of EB-5 and about the industry, call your Congressional Representative and tell them that it's time to get it together.   I have seen the powerful local impact of EB-5 dollars channeled into truly poor parts of this country and there are ample testaments to impact of EB-5 capital on impoverished American communities.   As the owner and operator of a small EB-5 Regional Center which really DOES create jobs in such communities, being forced into the role of EB-5 "apologist" as a result of the political power of those who see EB-5 as simply a convenient "cost of money" subsidy for their luxury projects has gotten quite tiresome. 

Let's clean this up, guys, before they take it away from us.  Time to stop subsidizing megadevelopers with money intended to create jobs in bona fide high-unemployment parts of America.  Basta.



In House EB-5 Broker/Dealers? Not Sure I Get It

EB-5 Investments fall under, we know, U.S. Securities laws...but I have a partial, academic disagreement with that concept as a blanket statement.   After all, the Howey Test requires there to be an expectation of financial gain to meet the accepted definition of "security".  So whenever I am approached by a prospective AVS EB5 investor and I explain that our deal uses a 5 year loan model, that they'll get a miserly 1% annual return, and that, at the end of the day, when they hopefully are U.S. Permanent Residents and get their $500,000 investment back, they KNOW from the first conversation that investing in AVS EB5 will represent a NET LOSS to their bank account, since the various fees and costs inherent in undertaking an EB-5 visa will no doubt EXCEED that $25,000 in interest they'll be getting.  The point: if an investor knows IN ADVANCE that they will be LOSING money in undertaking an EB-5 investment, that they will NOT be making a can it be a "security" under the Howey Test?

The answer doesn't matter, and even if I am "academically" right, the fact of the matter is with so many EB-5 scams out there, SEC pro-active involvement in EB-5 is in the public interest, and so we meticulously build securities compliance into our platform...even if my investor is acutely aware that, green card objectives aside, this will be one of the least intelligent FINANCIAL "investments" of their life since I am promising them they will LOSE money!

As terrified as I am of an SEC audit (or, for that matter, an IRS audit, or of my wife chastising me for totally messing up the order in the spice drawer of the pantry, etc.), I welcome all policing of the EB-5 program, from both the USCIS and the SEC.   After all, we can't seem to get it together enough as an industry to even acknowledge obvious abuses like TEA "gerrymandering" and The Myth of Tenant Occupancy New Job Creation...if WE won't watch ourselves, the feds have to; the millions spent by the leading EB-5 Regional Centers to prevent the reform our industry needs says it all. 

When viewed through the lens of historical jurisprudence, where laws are distilled and clarified over many decades, EB-5 is still very much a baby...and ALL of us - even the federal agencies -- are still sorting things out.  The EB-5 became law in 1990; after two and a half decades of court decisions, policy memorandum, and (often reeeeealllly boring) teleconferences,  we have a loosely regulated but powerful tool for bringing foreign direct investment (FDI) into the U.S.   Based on the documented abuses which have tarnished this great tool's reputation, the SEC specifically said in early 2016 that it would be watching EB-5 carefully.   Moreover, FINRA is cracking down harder than ever on the very financial institutions via which our investors fund their EB-5s: according to a report by law firm Sutherland, Asbill, & Brennan LLP, the overall sanctions imposed by FINRA increased significantly in 2015 due to $96 million of restitution; the 2015 restitution amount was a record for FINRA and an increase of 200% from the $32 million ordered in 2014. 

When you are raising funds exclusively for - humblebragging - the Forbes 400 group you've been lucky enough to work with for many years, securities compliance is handled by a veritable army of extremely expensive law firms which don't just cross my T's and dot my i's but who delete/redact/replace/approve every pixel on the page to insure that we are bulletproof in our compliance.  Other small Regional Centers are no so lucky and have to hire outside experts.   But the big EB-5 boys -- the same ones who spent all that money to buy one more year of the status quo -- would appear to have found a better solution.  They brought in In House EB-5 Regional Center Broker/Dealers, and when I first saw that, my reaction was the same as it is to all bright, shiny objects:  "I wish I could afford one of those...."

But then I thought about it carefully:  compliance is one thing.  An in-house broker presence is something altogether is a sales tool...and that's just fine!  You see, whether you are big or little or medium USCIS-approved EB-5 Regional Center, the establishment of a reliable and sound plan ensuring consistent compliance is really neither that expensive nor complex.  It just means you have hire qualified securities counsel to define the rules and then you have to play by them.  Like by not broadcasting online ads in the U.S.  Or paying commissions to attorneys or unlicensed brokers.

It means getting EB-5 investors ONE AT A TIME...and that isn't quite as easy, is it?

So then, my question: if ANY EB-5 Regional Center can establish a securities compliance plan and stick with it...why do you need to bring in an In-house broker/dealer?  The answer is to create confidence in prospective investors by showing that your Regional Center is SOOOOO compliant that it has it's very own B/D!  Except that these B/Ds aren't the same folks who define the compliance plan...only one or two in the EB-5 sector are even attorneys.  So my conclusion is that while it is WAY cool to have an in-house RC B/D, it is more about appearance and marketing than it is about "compliance".

Mind you: there are both excellent Regional Centers with GREAT in-house B/Ds and lousy ones with less compelling in-house B/Ds.   There are some Regional Centers which didn't go "in-house" but specifically partnered with existing brokerage firms, equally efficient from an appearance/marketing point of view.  But my point is this: Regional Center securities compliance plans have ZERO to do with whether or not they have brought a B/D in house.   Sharp EB-5 prospects should neither be seduced by the presence of a broker/dealer in a given EB-5 Regional Center, nor discouraged by the absence of one at a smaller Regional Center.

I will leave you with a final question to ponder:

How many of you out there have ever seen a SINGLE EB-5 investor referred to an EB-5 project via the ONLY person with which the EB-5 registered broker/dealer can lawfully split fees (i.e., ANOTHER registered broker/dealer)?

Me neither... and that's why I'm not sure I get it.





A Voice Crying in the EB-5 Wilderness....

I know, I know.  It's been so long since I wrote on a regular basis that most of you who remember my penchant for melodramatic EB-5 rants haven't even put your teeth in this morning.  I understand.  Come back to this after your coffee and Centrum Silver, this will still be here.

For the rest of you whippersnappers who don't know me, here's a few things to ponder regarding 2016's Great Showdown between the GINORMOUS EB-5 behemoths ("BIG EB5") and the rest of us trying to make EB-5 work the way Congress intended way back in 1990 ("We b5" or, easier "Web5"):

  • When Congress thought up the EB-5 - an investment based path to U.S. residency -- all hell broke loose about the concept of "selling green cards".   After Americans understood that paths to U.S. migration via investment were as old as our country (starting with European migration pre-Industrial Revolution and long stabilized via the L, Eand TNvisa categories - the latter two permitting an unlimited number of years in a "temporary" status), everyone calmed down.  The U.S. did what Australia, Canada, and other very smart countries had done decades ago, except twisting the plot to require a mandatory element of "risk".
  • After a floppy first decade in the 90's where many investors - mostly Chinese - lost their money AND their green cards, the USG shelved the program, only to have it emerge from the ether years later.
  • Six years ago, my Florida Regional Center - American Venture Solutions - was the 39th approved.  Suddenly the whole world was talking about EB-5 and, presto, we now have almost 800 USCIS-approved Regional Centers, the bulk of them stumbling around like extras in the woods on the set of The Walking Dead.

In light of this explosion of interest - and in light of the rapid involvement of leading U.S. developers like Forest City Ratner, CIM Group and The Related Group -- the business of EB-5 has grown.  But as it has grown, it has grown further and further from what Congress intended when they crafted a law designed to stimulate job creation in those places where it was most needed. Today, the numbers say it all: the vast majority of EB-5 projects are NOT going up in rural America or, for that matter, in impoverished urban areas.  They are going up instead in the gentrified (man, I HATE using that word but it is the only one which says it correctly) parts of America’s most thriving urban centers.

Is that a BAD thing in and of itself?  No!  There is no doubt in my mind that what BIG EB5 is doing DOES have a favorable economic impact and DOES create jobs, etc.  But the “bad” part is that by entering the EB-5 market with unlimited budgets and little interest in “Congressional Intent”, those precious few 10,000 EB-5 visa slots per year – and remember, that includes the investor AND his/her family members – are being gobbled up by projects that will do ZERO to help those areas Congress expressly intended to help when it created the EB-5. 

Consider the numbers, according to

·        In 2015, the Related Companies spent at least $730,000 in lobbying fees related to the viability of the EB-5 visa program, according to data from, a website that tracks lobbying expenses and campaign finance, created by the nonprofit Center for Responsive Politics. (Interestingly, $690.000 of that went to Greenberg Traurig, a very large law firm which has expanding its EB-5 practice geometrically in the past years.)  As impressive as that figure sounds, $730,000 is a tiny fraction (0.12 percent) of what Related has raised in EB-5 funds for its Hudson Yards megaproject, about $600 million according to various media reports.   As EB-5 stands today, Related's investment in lobbying against change is the ONLY intelligent business decision for them.

·        OpenSecrets also reported that next up as far as EB-5 lobbying money was CIM Group, which spent $480,000 in 2015, up from $280,000 in 2014, according to OpenSecrets. This year, the investment firm hired law firm Brownstein Hyatt Farber Schreck to monitor “EB-5 and related matters,” according to OpenSecrets.

 ·        Next in the lobbying line, according to OpenSecrets, was Forest City Ratner,  spending a combined $140,000 on lobbying in 2014 and 2015, according to the database. According to published data, over 1,100 foreign investors pumped $577 million into Pacific Park Brooklyn, a joint venture between Forest City Ratner Cos. and Greenland USA.

Now, before you go all Ted Cruz on me and accuse me of Big Apple bashing, let's get this straight: I ♥ NY(C) probably more than any non-Manhattanite I know and am ALL FOR EB-5 investments in big cities...but do you see what's happening here??  Each of these three BIGEB5 developers – and there are countless more of smaller scale—is a de facto superpac, if you will, putting formidable political influence which the rest of us – the WEB5ers – are absolutely powerless to counter.   And at the end of the year, with their financial firepower, they succeeded in yet AGAIN tabling EB-5 reform by extending the program without changes for another nine months, and no doubt that the vast majority of EB-5 dollars for FY2016 will be gobbled up by the big guys.

As someone with projects in Canal Point, Florida [Pop. 525, with about 20% of families living below the poverty line] and (soon) in rural – and I mean THE BOONIES, Tennessee – I think that the EB-5 structures AVSEB5 is offering – all backed by Fortune 400 U.S. owners with every bit the credibility and proven success of BIG EB5 -  DO conform with the spirit of the EB-5 visa.  Look, I don’t want or need rural “quotas” and I'm not asking for a handout.  I certainly don’t want BIG EB5 stopped/limited/restrained, and I’ll go toe-to-toe with any BIG EB5 project on the subjects of careful stewardship of investor funds, realistic projections, and mechanisms in place to do everything legally possible to realize PERMANENT residency for our investors. 

All I want – both for me and for the rest of us who are not BIG EB5 -- is a fair playing field where the metrics of job creation represent reality, not numbers games.  EB-5 NEEDS reforms that limit bogus job counts via the whole “tenant occupancy” nonsense and absurd TEA manipulations that result in EB-5 funded high-rises adjacent to buildings selling $3M condos!

It’s time to cut the baloney and give the WEB5 Regional Centers like AVSEB5 a fair shot at bringing some of that EB-5 money to the truly poor parts of both rural AND urban America, for which it has always been destined.


AILA Florida Conference: the 2016 EB-5 Takeaway

Well, for the very first time, I spent my two days at the annual South Florida AILA conference sitting in a booth instead on the panel or in the audience.  American Venture Solutions Regional Center, the EB-5 regional center I formed, own and operate and which exclusively structures EB-5 projects backed and operated by the same Forbes 400 folks with which I've worked for almost two decades, FINALLY decided to host a booth at an AILA event, and we had a GREAT time speaking with old and new AILA friends.  (Check out the picture of AVSRC Manager Bianca Saltz, MBA and Laura Callava,  LatourLaw Associate Attorney at our new booth).

The three of us were busy explaining our current project, Lake Point Logistics (a Florida logistics/trucking company supporting the South Florida mining sector) and I didn't attend the sessions, but did manage to catch most of the hour-long session on the future of EB-5.

Led by my old friend Tammy Fox-Isicoff (one of sharpest, most passionate immigration advocates I've ever met) and the venerable Ron Klasko (one of the deans of the EB-5 bar and the most respected EB-5 compliance practitioner in the country), the session was informative, provocative, and, as is usual when they are on a panel together, dynamic and entertaining.  As I've written so many times before, I am sooooo over the rampant, baseless speculation bombarding the Web via the well-intentioned blogs of a million EB-5 attorneys, developers, and observers.  Despite the reality that we honestly don't know IF or WHEN or HOW the EB-5 will be amended, Tammy and Ron and the other panel members delivered an informative session which gave new context to where the EB-5 industry is today...and where it will probably be going.  Here's what I got out of their session:

  • The panel's consensus seems to mirror my own: no matter how messy things have gotten with EB-5, reform and continued improvement is likely because there is simply too much money at stake - both in terms of the favorable job-creating results of EB-5 as well as in terms of the megadevelopers fighting to keep low cost EB-5 capital available for their urban projects -- for Congress to let the EB-5 program die.
  • Between Big EB-5's multi million dollar lobbying efforts in late 2015 which resulting in Congress "kicking the can down the sidewalk" till the end of this fiscal year (that is, leaving the current EB-5 program untouched and extending it through Sept. 30, 2016) and the very proactive role federal agencies and Congress are taking so far this year, it is ENTIRELY possible that instead of the usual waiting until the law is about to expire, Congress could conceivably enact a NEW 2016 law even BEFORE Sept. 30th!
  • TEA-tightening rules preventing the manipulation/linking of numerous census tracts so a developer can have their ritzy high rise property classified as a "targeted employment area" and thus allow $500,000 EB-5 investments are a given in any new bill (ergo, if an investor investing today wants to be 100% safe, he or she will ONLY consider EB-5 projects in RURAL areas, which will remain immune from these anticipated reforms.
  • Despite the safety of RURAL TEA EB-5 projects, they believe - and I agree -- that the push for “reserved for rural” spots will not happen.  (Despite the fact that my Regional Center has so far ONLY deployed projects which are indeed either rural or non-contrived TEA, I never thought the "rural only" idea was right.  The point is to change the rules to prevent TEA manipulation which permit megaprojects in thriving urban centers;  the truly DESERVING communities for which EB-5 was originally intended are both rural AND urban, and job creating in TRUE inner city TEAs is every bit as it is in the most rural and poor parts of Appalachia, IMHO.) 
  • From the nodding heads in the big room, it wasn't just that panel who believes that the anticipated increase from $500K to $800K is all but a certainty.
  • The panel seemed to agree with my position that the retroactive application of changes in the investment amount is extremely unlikely.  (Besides the injustice of retroactive application of changes to vested investors, there is the more practical consideration of the tremendous complexity USCIS would face in "recalculating" projects de novo.)

Although I can't recall the panel specifically saying this, my impression was that they believe as I do that the troubling issue of "Tenant Occupancy" is not going away.  USCIS economists have correctly argued that while redeveloped projects certainly create an important number of NEW jobs within the context of EB-5 regulations, the current position taken by EB-5 developers that each position hired by tenants in a redeveloped business property is "new" is just silly.  It's not like these folks were beamed down from the Enterprise, right?  But withmany EB-5 projects lacking alternative financing, anything less than 100% "Tenant Occupancy" job count will mean projects simply can't raise enough EB-5 capital to deploy, leaving early investors in a bind.  I predict this will be one of the biggest EB-5 fights of the year, if not THE biggest.

As USCIS' recent congressional testimony and the SEC's announcement that the EB-5 visa is a priority for the agency in 2016 suggest,  it looks like the upcoming elections aren’t necessarily dulling the debate and slowing progress on EB-5 reform; the vibe in DC is “EB-5 is important but it is broken and it needs to be fixed”, so changes are very likely I think. [If you will be following EB-5 developments closely in 2016, be sure you subscribe to EB-5 business plan writer Suzanne Lazicki's consistently brilliant blog (  I think it is the single best EB-5 resource online.]

In sum, I would say that I left the EB-5 session feeling somewhat reassured that EB-5 will not be "killed".   I think that AVSEB5's continued focus on conservative EB-5 projects in the boonies, creating real local economic impact and operated by the only Forbes 400 group involved with EB-5 is the way to go.  And I'll definitely sleep better at night knowing that whatever reforms are coming down the pike, changes in TEA rules and Tenant Occupancy will have ZERO impact on our AVSEB5 investors.



EB-5, V2.0

Here I am, scrunched in coach, next to an extremely big and irritated fellow, juggling my laptop on my knees in the bulkhead row, 4 hours into MIA-LAX.   When I land in 1 hour and 20 minutes, I will next climb into another similarly-sized coach seat for the next 15 hours and 25 minutes – hopefully with a more compact seatmate – as I continue on to Melbourne, Australia to visit my son, Alex “Crocodile” Latour.

The things one does for one’s children.

As an extremely frequent flyer who crosses the oceans on a monthly basis and who has enough upgrade miles to sit up in the cockpit, 22 hours in coach is, well…unusual for me.  But that is not the problem.  The problem, you see, and the reason I will probably be carried off the plane in rigor-mortis-like seated position, is with Congress’ inability to commit to the EB-5 Investor visa 25 years after they first created the category!

You see, here is what happened:  my original journey took me from Miami to the Far East for my regular EB-5 travel, with a nice direct connection in Business Class from Vietnam to Australia.  But due to our government’s failure to do what they are hired to do and their tradition of kicking the can down the sidewalk repeatedly, September 30th came and went, now it’s December 11, and our prospective investors have absolutely NO clue what to make of all this.  So we pulled the plug on the Asia visit at the last minute and here I miserably sit, too squeezed to type comfortably…yet too cheap to have sprung for a $14,000 Business Class seat.  Sigh.

If I place primary blame on Congress – and I most certainly do – secondary blame falls squarely on the shoulders of my hyperbolic EB-5 attorneys, who have been pumping out more absurd, unfounded, and baseless blather about “the new EB-5 changes” since the beginning of the summer than a gaggle of Donald Trumps on meth.   Although less subject to the myth that “if it’s on the Web, it’s true” than most Americans, prospective EB-5 investors worldwide have been subjected to infinite conjecture, fabricated speculation, and, worst of all, shameless hucksterism in the form of “better buy now before the price goes up” monologues.  No WONDER EB-5 prospects are confused, and who can blame them?

As we again sit in EB-5 limbo, we have two very different pieces of legislation under consideration:  one slam-dunks the EB-5…who needs these dang ferners creating U.S. jobs anyway??  The other, with more than a modicum of common sense, purports to leave the $500,000 TEA/Rural price of admission unchanged and, more importantly to restore the 10,000 cap to what Congress intended when the EB-5 was created via IMMACT90: 10,000 investors, not a total of 10,000 people counting investors AND eligible family members.  But despite the Jekyll-Hyde contrast between the two proposed bills, the truth is that this is CONGRESS in action and ABSOLUTELY KNOW ONE HAS ANY IDEA WHATSOEVER WHAT WILL ACTUALLY HAPPEN.  So, to perhaps clear things up for folks wandering through the muck of EB-5 blog speculation, let’s ask the questions we need to be asking:

Will the price of a TEA/Rural EB-5 investment go from $500,000 to $800,000?  Maybe. 

Will investors who have pending I-526s with $500,000 projects be protected from having to cough up another $300,000 if the price DOES go up?  No one has ANY idea.

Will a Regional Center I-924 filed before December 11th be protected by the $500,000 price if it DOES goe up?  No clue.

Will USCIS economists who have long battled the totally bogus calculations used in defining “new job creation” via tenant occupancy throw in the towel?  Don’t bet on it.

Will everyone just forget all the media pointing out the convoluted TEA methodologies which make new skyscrapers in the most exclusive parts of Manhattan and Miami EB-5 capital magnets because they fall into fabricated “targeted employment areas”?  No way, says Jose.

The truth is that while we have no idea what will unfold in the coming months, there are many “stakeholders” with conflicting interests.  Among these are massive EB-5 centers whose very structure relies on the perpetuation of the “tenant occupancy” myth and who will spare no expense to fight the logic of USCIS economists.  And there are lawyers telling their developer clients to hurry up and file yet another Regional Center which, like the vast majority approved in the past five years, will never raise a single EB-5 dollar for a variety of reasons.  Too much money is at stake.

Whatever EB-5 V2.0 ultimately turns out to be, this much we know today.  The program has worked very well and you have until December 11th to buy your $500,000 price of admission, so first do your homework and then - if you KNOW you want EB-5 U.S. residency...choose WISELY.

A New Year, a New Blog

It's been quite a few years since I stopped my "Immigration Insider" blog, and, frankly, it's been good to NOT share my legal point of few during this period.  For starters, I've gone from "U.S. consular officer" to "private business immigration attorney" to whatever it is I am today rather imperceptibly.  Today, my lawyering is limited to two things: protecting the interests of a handful of HNW international clients and running American Venture Solutions EB-5 Regional Center, which I co-own with my infinitely-smarter-than-me, Forbes-pedigree partners.

But this new version of my legal practice is hardly an excuse to begin a blog.  Indeed, the number of excellent bloggers discussing both private client concerns and EB-5 matters mean there is little for me to add content-wise to the online body of good information already in existence.  That being said, I do recall that it was my ranting - as opposed to my particularly brilliant insight - which led me to amass an impressive 30,000+ daily readers in the late 90s (banged out on my Fred Flintstone Edition Thinkpad).

Well, there is PLENTY about which to rant in both subject matters:  international private clients are being treated like drug dealers as a result of overreach by U.S. laws intended to counter terrorism; simultaneously, there is a viper pit of my brethren who have gone from EB-5 sans clue to "experts" in a blinding year or two, enriching themselves via false promises of easy money and lines of Chinese investors with cash in hand made to U.S. developers who merrily plunk down several hundred thousand dollar for yet ANOTHER EB-5 Regional Center which will fail to yield a SINGLE investor dollar when all is said and done.

There.  I can still rant.  And so it begins...

JEL (in Bologna on Valentines Day)