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How long must an EB-5 investor’s funds be considered at risk?

An EB-5 investment must remain at risk until Form I-829, Petition by Investor to Remove Conditions on Permanent Resident Status, is adjudicated by United States Citizenship and Immigration Services (USCIS). If the investment is no longer at risk when the I-829 petition is being adjudicated, USCIS will deny the petition.

The EB-5 program’s at-risk requirement entails that all EB-5 investors must be open to financial loss as a result of their investment—there can be no guarantees regarding the success of the EB-5 project, and a financial resolution cannot be determined before an investment is made. Even though many project developers keep their EB-5 capital in an escrow account until each investor’s Form I-526, Immigrant Petition by Alien Investor, is approved, there cannot be a contractual right to repayment.

Moreover, the USCIS Policy Manual states that each investor must “establish that the investment was made, or is actively in the process of being made, with the immigrant investor’s own funds.” This means that every EB-5 investment must be made before the investor files Form I-526. The vast majority of investors provide the full amount of capital at once, but some projects allow for partial investments over a set period.

In addition to being exposed to possible financial loss, EB-5 investors must show USCIS that the project is active. The project’s business plan and other documents must demonstrate that it is conducting business activity. For example, real estate project developers can provide construction contracts, building permits, and other similar evidence.

As part of the at-risk criteria, the EB-5 program also requires the investment capital to be made available in full to the job-creating entity (JCE), which is in charge of generating at least 10 jobs per investor. If an investor’s capital is not made available to the JCE, or if the JCE does not reasonably need the capital, the investor’s I-526 petition will likely be denied.