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Sunday, December 21, 2014

What happens to the securities issued by regional centers WHEN and not IF the I-526 petitions filed by over 11,000 investors are rejected?

Due to the fact that the SEC, FDNS Directorate of USCIS & IRS are now actively monitoring EB-5 visa petitions, and the GAO is conducting it's own audit of the EB-5 visa programs, it is quite likely that well over half of the I-526 petitions currently filed with the USCIS will be rejected as there is no way that most Chinese investors will be able to prove that they have lawfully earned their investment funds and will also be unable to prove that they didn't launder funds. Due to this, it is definitely true that there will be processing delays, but I can bet my bottom dollar that Bernie Wolfsdorf will end up looking like an idiot as his prediction of an EB-5 visa backlog falls flat on it's face. Bernard Wolsdorf says on his website "A Chinese EB-5 quota, or waiting line, (often called retrogression), is a certainty and the China EB-5 cut-off date will start in May or June 2015." and I say Mr. Wolfsdorf seems to be out of touch with reality, as apparently certain steps have already been taken to ensure that this time around, it will be impossible for adjudicators to ignore fraud, forged documents and money laundering, even if the corrupt Alejandro "Ali" Mayorkas himself tries to lean on USCIS Adjudicators, as he had earlier leaned on the USCIS adjudicators to illegally approve EB-5 visas for Sam Nazarian's casino in Las Vegas, at the behest of Senator Harry Reid.

I believe that anyone who is smart enough to short the securities (especially debt) of certain major securities issuers such as Related, Extell, SBE (SLS Casinos), Bay Area Regional Center, etc. will be laughing all the way to the bank if these entities default due to their visa investor's petitions being denied. Another factor that will work against the regional centers is that it is EXTREMELY unlikely that regional centers will be extended after September 2015. Nothing is impossible, but thanks to securities fraud, money laundering concerns, national security concerns, etc., the probability of regional centers existing after September 2015 is VERY LOW. 


EB-5 visa investors need to remember 2 things:
a) Regional Centers are NOT to be trusted, so whether an investor wants to go with EB-5 visas or EB-1C visas, a Genuine Direct Investment Business is the only safe option available for investors,
b) For the foreseeable future, EB-1C visas are safer, faster, cheaper and easier to obtain when  compared to EB-5 visas.

Regional centers usually commit securities fraud, which is why the SEC strongly advises EB-5 visa investors to avoid regional centers. Even ICE recommended that ALL regional centers be permanently shut down (see link to memo at http://www.smartbusinessbroker.com/EB5_ICE_fraud_memo.pdf). 

Securities fraud is so rampant amongst regional centers that a regional center's CEO & CFO will usually refuse to offer EB-5 visa investors the following 2 guarantees in writing:

1) Guarantee of freedom from fraud and conflict of interest,
2) Guarantee of full disclosure of material facts.

Some of the material facts that regional centers don't disclose to EB-5 visa investors is that they illegally market and sell securities overseas. Other facts that regional centers and unscrupulous direct investments such as those offered by E3 Investment Group or Joe Sloboda's Voodoo BBQ and Twistee treat don't disclose is that they have significant conflict of interest embedded in their offerings structures, which causes significant capital losses. Regional Centers also don't disclose the fact that not only the SEC but also ICE has strongly recommended that regional centers be avoided by EB-5 visa investors due to serious concerns about fraud and money laundering. See link athttp://www.smartbusinessbroker.com/EB5_ICE_fraud_memo.pdf and read the blog at http://eb5-expert.blogspot.com/ to learn more. Regional Center marketers and promoters usually don't disclose the material fact that regional center petitions take far longer to process compared to Direct Investment petitions.

As it is, many EB-5 visa investors now understand that Genuine Direct investment businesses are the safest option in every single aspect. Here are some of the critical reasons that EB-5 visa investors should ALWAYS choose Genuine Direct Investment Businesses and avoid regional centers:

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 Twistee Treats or Voodoo or Marcos Pizza), while those who opt for Genuine Direct Investment Businesses usually NEVER experience capital loss.

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.

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

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

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.

EB-5 visa investors in Genuine Direct Investment Businesses 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.

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.

The ONLY safe, fast and usually profitable way to get an EB-5 visa is through investment in a GENUINE Direct Investment Business. An even faster and easier way to get a PERMANENT green card is to apply for the L1A visa and then the EB-1C visa.

Many immigration attorneys and so-called due diligence "experts" fail to disclose important facts to investors. One such set of facts is that it takes 3 years to get a temporary green card and an additional 30+ months to get a permanent green card in EB-5 visa category, while investors can get a permanent green card in 2 years with EB-1C category visas.

Unscrupulous immigration attorneys, Regional center promoters and marketers deliberately conceal the important fact from investors that it is expected that EB-5 visa investors will take at least 2-3 years to get a temporary green card under EB-5 visa category, and an additional 2.5 years to get a permanent green card. In this period, the investor faces an unnecessary delay that can be easily bypassed simply by using the EB-1C visa option, with which investors can get a permanent green card in as little as a year to two years.

The advantages of EB-1C are as follows:
1) Very little chance of fraud, compared to rampant fraud seen in regional centers in the EB-5 visa program.
2) Significantly lower investment amount. In EB-5 visa, a minimum investment of $500,000 is needed, whereas I've had clients get approved with even $350,000 investment in EB-1C visa category.
3) There is total flexibility about location: EB-1C visa investors face no restrictions about location, whereas EB-5 visa investors see significant location based restrictions if they invest only $500,000, and investors have to invest minimum $1 Million to avoid location based restrictions.
4) The EB-5 visa program has onerous proof of fund requirements, whereas the fund documentation requirements are definitely not as stringent in EB-1C visa program.
5) The job creation requirements are a lot more onerous in EB-5 visa, and I've seen that creating even 4 jobs suffices for an EB-1C visa.
6) Unlike the EB-5 visa program, there is no conditional green card in EB-1C visa program.
7) The time to get a permanent green card under EB-1 visa program ranges from 1-2 years, whereas it takes almost 5 years to get a permanent green card under EB-5 visa category. Business owners & executives can immediately move to the US on L1A visa, and get their green card in hand within a matter of months, whereas EB-5 visa holders have to wait for about two years to just get a temporary green card.

Keeping the above factors in mind, most investors are now choosing to go with EB-1C visa as it is a lot cheaper, faster, safer and easier to get compared to the EB-5 visa.

If you are a business owner or high net worth individual interested in migrating to the US, please hire our team. We offer a turnkey solution and have a solid track record of success, as we believe in delivering results and not excuses to our clients. That is why we have a 100% fee refund guarantee while our competitors usually don't offer such a guarantee.

Mohammed Shaikh, MBA (Accounting), CFE, Licensed Business & RE Broker (CA & FL)
Online:  http://www.smartbusinessbroker.com Phone: +1 407 535 0616


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