EB-5 visas surge in popularity

By Nia Wong | nwong@lasvegasnow.com, Brian Toreson

Published 07/25 2016 10:58PM

Updated 07/26 2016 08:06AM

Our country's history is filled with countless stories of struggles and hardships by immigrants. If you are wealthy enough, however, you can pay your way in. Foreign nationals willing to invest $500,000 to create jobs can get a fast-track to U.S. citizenship through EB-5 visas.

This option has been available for more than 25 years. In the last decade, applications have skyrocketed for what some are calling the "millionaire's visa."

EB-5 supporters say this program fuels development and creates jobs, but not without igniting controversy along the way.

The recession of 2008 put development on hold in Las Vegas, but foreign money sparked a comeback from that economic slump.

In 2013, EB-5 funding established itself in the valley with the development of the Downtown Grand, followed by the SLS Las Vegas and the Lucky Dragon, which is scheduled to open this year.

David Jacoby is the Chief Operating Officer of the Lucky Dragon Hotel and Casino.

"There's nowhere like Las Vegas, anywhere in the world with the entertainment we have here, with the excitement of the Vegas Strip,” he said. “So, this is a world-renowned destination."

He says the Lucky Dragon has more than 100 investors through the EB-5 program and says he believes their success is credited to their track record.

"We've been really effective in getting EB-5 investors their green cards,” Jacoby said.

In order to pave the pathway to citizenship with an EB-5 visa, at least half a million dollars needs to be invested into an area with high-unemployment, and the investment must create at least 10 jobs. Those interested are subjected to a number of background checks, including how they got their money to fund these projects.

"When we file these cases, frequently, the source of funds documents may be more than a foot high to try and show they earned their money legally,” said Stephen Yale-Loehr, who teaches immigration law at Cornel University.

He says EB-5 investors are vetted as thoroughly as anyone else who applies for a green card.

"This is a way immigration can enhance the national economy by creating jobs for U.S. workers at no expense to the taxpayer,” he said.

As long as all the boxes are checked, EB-5 investors can typically expect a green card in as little as two years. However, the system poses an ethical dilemma for some.

"I don't think we want to reward people, just because they're brand new millionaires,” said immigration attorney Peter Ashman.

Once an avid supporter of EB-5, Ashman says he no longer is involved with the program after reaching a turning point.
"When I see how hard other people struggle to get their green cards and to get their papers straightened out, I guess I have a problem with people coming in and essentially buying green cards,” he said.

Ashman acknowledges the program's economic benefits, but what's touted to be good for the national economy may be suspect for national security.

EB-5 investors can pool their money into regional centers, an aspect of the program which has come under scrutiny.

Audits by the Department of Homeland Security's Office of Inspector General and the Government Accountability Office found the United States Citizenship and Immigration Services could not verify investor funds were "obtained lawfully", or that they properly recorded basic information such as names and birthdates.

"Overall, we want an immigration policy in this country that sort of reflects our values,” Ashman said.

Ten thousand EB-5 visas are allowed annually. Last year was the first time the program nearly capped out.

Ninety percent of EB-5 visa holders were from China. The most popular reason for Chinese investors wanting these visas is to provide an American education for their children.

Despite the risks, popularity for the program continues to grow.

“We're starting to develop backlogs like in all the other categories,” Yale-Loehr said. “It's incumbent on Congress to enact comprehensive immigration reform, so that we have a working system going forward for everyone."

EB-5 was set to expire last year, but Congress couldn't decide whether to renew the program with revisions, like raising the investment limit. The program was expanded through this year, lawmakers may revisit it in September.

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