EB-5 investors who conduct proper due diligence are generally successful. Indeed, most EB-5 investors end their EB-5 journey by obtaining U.S. green cards for themselves and their immediate family members. That being said, each year, some EB-5 investors face denial, halting their dreams of a better life in the United States.
The reasons an EB-5 petition may be denied are manifold, but some are more common than others. Below are a few of the most common reasons EB-5 investors have their petitions rejected.
Investing less than required or investing in an ineligible project
The minimum required EB5 investment amount is $1.8 million, although this drops to $900,000 if the project is in a targeted employment area (TEA). If an EB-5 investor fails to invest the minimum required amount, their I-526 petition will be denied.
It’s also crucial to invest in a project that qualifies for the EB-5 program and, if you’re investing through an EB-5 regional center, to conduct thorough due diligence to ensure you work with a highly reputable developer and regional center. In 2019 and 2020, regional center terminations have skyrocketed, putting investors who fail to carefully vet regional centers before diving into an investment at risk.
Willfully misrepresenting information in an EB-5 application
Even if an EB-5 investor feels inclined to skew the facts to produce a better-looking application, they must resist the urge. If they intentionally misrepresent any material facts or otherwise submit a fraudulent EB-5 application, they may be permanently prohibited from obtaining a U.S. green card and may even be barred from entering the United States.
Not providing accurate or consistent information
It’s crucial to ensure the information an investor includes on their I-526 petition is as accurate as possible. Investors should collaborate with an experienced EB-5 immigration lawyer to gather all the necessary documentation and compile a suitable I-526 petition. Investors are also advised to double- and even triple-check all the information in their petition before filing it. While inconsistent information may lead to a request for evidence (RFE) rather than a denial, it’s best to prepare well in advance to avoid any delays.
One aspect of the I-526 petition that’s particularly tricky is the source-of-funds requirement. All EB-5 investors must demonstrate that their investment capital derives from lawful sources, but depending on the source of their funds, this can be a difficult and time-consuming endeavor. On the I-829 petition, filed later in the EB-5 process to remove the conditions of the investor’s permanent resident status, an investor must provide evidence that their EB-5 investment has remained “at risk” for the duration of the investment period, which is another area where meticulous care is warranted.
Children aging out or getting married
With an EB5 investment, a foreign national can secure a U.S. green card not only for themselves but also for their spouse and children. However, the ability to add children to one’s EB-5 application is contingent on the child being younger than 21 and unmarried, and the long wait times associated with the EB-5 program, especially for investors from backlogged countries, can complicate familial immigration matters.
For the purposes of immigration, the ages of dependent children of EB-5 investors are frozen until I-526 approval is granted, which means a child aged 21 or older may still be eligible for an EB-5 green card as long as they were younger than 21 when the I-526 petition was filed. However, in the case of delays in receiving a visa appointment—such as the closure of U.S. embassies and consulates due to a global pandemic—children are not protected from aging out. Similarly, the longer investors must wait for EB-5 approval, the higher the likelihood that a child will marry and become ineligible.
The ineligibility of a child won’t cause USCIS to deny the investor’s EB-5 petition for the entire family, but the child in question will not be qualified to receive permanent resident status in the United States, so it’s important for families to make careful considerations regarding their children.
Other reasons for denials
EB-5 investors may face denial for any number of other reasons as well, including health reasons, previous criminal convictions, or security-related concerns. EB-5 investors can get a more comprehensive idea of the reasons for potential denial on the U.S. Department of State – Bureau of Consular Affairs website.
What do you if you receive a denial?
Having your EB-5 petition denied is disheartening, but depending on the reason, it doesn’t necessarily mean your EB-5 dreams are over. USCIS should specify the reasons for denial, giving the investor a clear picture of the situation and what they did wrong (if anything). EB-5 investors still have various options, including filing an appeal or seeking alternative immigration pathways, if their EB-5 petition is denied. Consult an experienced immigration attorney to determine the best solution for you.
