Risks Factors for EB-5 Investors

The EB-5 Immigrant Investor Program provides a convenient way for foreign nationals to relocate to the United States. Every year, numerous foreign nationals invest in the EB-5 program to gain permanent resident status. The program also helps to boost the U.S. economy by creating jobs and injecting capital into local businesses.

Still, making an EB-5 investment does entail financial and immigration risks. Before participating in the EB-5 program, foreign nationals must decide whether they have adequate resources to navigate through these risks.

No Guaranteed Profits

United States Citizenship and Immigration Services (USCIS) guidelines require that the capital invested in an EB-5 business be at risk. A project where a return on investment is guaranteed does not comply with this guideline. Therefore, EB-5 investors may not make any profits or even incur significant financial losses.

For foreign nationals whose primary concern is to secure permanent resident status for themselves and their families, this risk is worth taking. Nevertheless, prospective investors are recommended to do a thorough risk assessment before they make a final decision.

In addition to the financial risk entailed by USCIS criteria, the potential for fraudulent activities within the EB-5 investment industry is a matter of concern, albeit a rare occurrence. To avoid scams, investors must ensure that the potential EB-5 project is a legal entity. They should also do research on the management team members, especially those who will oversee the EB-5 funds.

It is a good idea for investors to visit potential EB-5 businesses to determine their authenticity and to collect third-party information.

A Green Card is Not Guaranteed

Every year, USCIS turns down dozens of EB-5 investment visa petitions due to compliance issues. Even after making the required investment, an investor may find they do not qualify for an EB-5 visa because the EB-5 project did not create at least 10 jobs or did not follow other USCIS regulations.

To reduce this immigration risk, investors must consider two factors when examining an EB-5 project. First, they must make sure that the EB-5 business can create at least 10 jobs. Second, they should evaluate whether the organization has sufficient funds to succeed even if it fails to raise all of the expected EB-5 capital. In this regard, the safest projects already have a number of EB-5 investors on board, are already active in construction or operations, and have funds from non-EB-5 sources.

Despite these risk factors, the EB5 investment program is considered one of the most secure and reliable visa-by-investment opportunities. EB-5 investors can increase their chances of obtaining a U.S. green card by working with EB-5 consultants and an experienced immigration attorney.