Wednesday, August 12, 2015

GAO releases their EB-5 visa program audit report which shows that there is widespread fraud committed by regional centers against EB-5 visa investors.

I just read the GAO Audit report at which shows that even today, there is rampant fraud in the regional center program, due to which EB-5 visa investors are better off choosing Genuine Direct Investments.

It is expected that this report shall make a lot harder for HR 616 and HR 3370 to pass, and as it is, GovTrack showed that both bills had no chance of passage. See and to get a realistic assessment of each bills chance of passage, which is NONE!

So far, it looks like regional centers shall expire in 6 weeks, and after that only Direct Investment Businesses shall be available as a choice for EB-5 visa investors.

Another major development that may kill the regional center program (which relies heavily on indirect job creation) is a lobbying effort by, which was created by the promoters of E3 Investment Group, Marcos Pizza and Voodoo BBQ, etc. They're lobbying Congress to eliminate the indirect job creation category altogether, which would lead to the automatic end of all regional centers, as regional centers are unable to prove even 30% direct job creation. I personally don't think very highly of E3 investment group, Marcos Pizza or Voodoo BBQ due to the fact that I believe the promoters of E3 and Voodoo engaged in conflict of interest, and the Indian marketer of Marcos Pizza may potentially be committing fraud. However, I do agree with them that there are plenty of direct job creation opportunities, due to which the indirect job creation rule should be eliminated from the EB-5 visa program.

From an analytical perspective, the ONLY potential bill that MAY succeed in temporarily renewing the regional center program is S 1501, as HR 616 and HR 3370 seem to have no chance of passage. However, the regional center industry is actively opposing S. 1501, which means that there may potentially be a chance that the regional center program will expire in September 2015, and Direct Investment is probably going to be the only option for EB-5 visa investors.

EB-5 visa investors need to remember that the ONLY safe way to get a permanent green card in the EB-5 visa category is by investing in Genuine Direct Investment Businesses. At present, there is very little chance of either of the regional center extension bills being written into law due to stiff Congressional and law enforcement opposition.
Some of the important reasons that EB-5 visa investors should ALWAYS choose Genuine Direct Investment Businesses and avoid regional centers are:

1.    In a Genuine Direct Investment Business, it is quite unusual to encounter fraud or conflict of interest. This alone is THE biggest reason why EB-5 visa investors usually experience capital loss if they opt for regional centers or unsafe Direct Investments (such as Voodoo BBQ or Marcos Pizza), while those who opt for Genuine Direct Investment Businesses usually NEVER experience capital loss.

2.    EB-5 visa investors who choose Genuine Direct Investment Businesses usually earn annual ROI of 15% to 40%, while those who select regional centers usually earn 0-2% annual ROI.

3.  Genuine Direct Investment Businesses offer easy exit strategies to EB-5 visa investors while those who invest in regional centers see TERRIBLE exit strategies. 

4.    Regional Centers usually commit securities fraud and securities law violations while this is usually unheard of in Genuine Direct Investment Businesses. 

5.    EB-5 visa investors usually get capital gains if they invest in a Genuine Direct Investment Business and almost NEVER get capital gains if they invest in a regional center. 

6.    EB-5 visa investors in Genuine Direct Investment Businesses usually see faster processing and approval of their petitions, while it takes much longer for EB-5 visa investors to get their immigrant visa through regional centers. 

7.    EB-5 visa investors in Genuine Direct Investment Businesses have a higher chance of getting their permanent green card, while those who opt for regional centers have a lower chance of getting their green card. 

 If you are a business owner or high net worth individual interested in migrating to the US without getting cheated, please contact us for a free consultation.
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