Who May Be Ineligible for the EB-5 Visa and Why?

Foreign investors opting for the EB-5 Immigrant Investor Program may experience certain challenges, affecting their path to U.S. residency. Understanding the requirements for a successful application is important, as missteps could potentially derail your investment process.

Knowing what could affect your eligibility and how to address it is crucial for a successful EB-5 journey, whether it’s your financial history or criminal record. This article highlights those who may not qualify as EB-5 investors and offers actionable remedies to overcome these challenges.

What Are the EB-5 Qualification Requirements?

To qualify for an EB-5 visa, foreign investors need to meet specific criteria demonstrating their commitment to the U.S. economy. They must invest at least $1,050,000 in a new commercial enterprise (NCE). However, if the NCE is located in a targeted employment area (TEA), the minimum investment is reduced to $800,000. Furthermore, the investment must create a minimum of 10 full-time jobs for U.S. workers.

Also, the source of the investment funds must be lawful. USCIS requires investors to provide thorough documentation proving the origin of these funds. The investment must also be “at risk” for a minimum of two years. This means there can be no guarantee of return or redemption, ensuring the investor is truly committed to the success of the enterprise.

Foreign investors can fulfill these requirements through two primary models: direct investments and regional center projects. In the former, you directly manage and oversee the business, while the latter involves participating in a regional center project, which pools funds from multiple investors for large-scale ventures. The regional center option is often preferred for its passive investment benefits and less complicated job creation requirements.

Below are the general requirements simplified:

1. A $1,050,000 investment in a new commercial enterprise (NCE), or $800,000 if the NCE is in a targeted employment area (TEA).
2. Creation of 10 full-time U.S. jobs.
3. “At-risk” investment period for a minimum of two years.
4. Lawful source of funds and proper documentation.

Investors who fulfill these conditions and whose applications get accepted may receive their conditional permanent residency status. Following a two-year period of conditional residency, they can apply to USCIS to have their restrictions lifted and become lawful permanent residents of the United States.

Who May Not Qualify as an EB-5 Investor?

Despite the broad appeal of the EB-5 program, not everyone meets the necessary qualifications. The following are categories of individuals who may not qualify as EB-5 investors and the remedies available to them:

1. Unaccredited Investors

While this is not a direct requirement by USCIS, unaccredited investors may not be able to invest in a regional center project. The U.S. Securities and Exchange Commission (SEC) mandates that only accredited investors can participate in private securities offerings, which include most regional center investments. This regulation exists to protect individuals from financial risks associated with large-scale projects that require significant capital.

To qualify as an accredited investor, investors must have a net worth of at least $1 million, excluding their primary residence. Alternatively, they must have earned an individual income of $200,000 or a joint income of $300,000 with a spouse in the last two consecutive years.

You will need to submit documents proving your eligibility if you fit any of these requirements and wish to invest through a regional center. You can also use your financial statements with the help of an immigration attorney to get an accredited investor verification letter.

Meeting the Accredited Investor Requirement

The SEC and licensed financial professionals can issue an accredited investor verification letter based on financial documentation. This step ensures compliance with SEC regulations and opens the door to participating in most EB-5 regional center projects.

Potential EB-5 investors who do not initially meet the accredited investor criteria can still qualify. They can combine assets, savings, inheritances, and cash gifts to reach the required net worth or income levels. Investors with large but fragmented wealth, such as those with significant savings, inherited assets, or property holdings, would benefit the most from combining assets.

This method is useful for individuals who don’t meet the income criteria alone but can combine their financial resources to qualify as accredited investors.

Additionally, younger investors, like F-1 students or recent graduates with financial support from family members, can leverage combined family assets to meet the accredited investor threshold. This strategy enables them to take part in the EB-5 program despite not having a long-established income history.

2. Individuals With Criminal Records

Individuals with criminal records may face obstacles when applying for an EB-5 visa. While no rule explicitly bars applicants with criminal histories, USCIS conducts thorough background checks. Serious offenses, such as fraud, money laundering, or violent crimes, are disqualifiers. Crimes of “moral turpitude” or “aggravated felonies” can also render an applicant ineligible.

If an applicant has a criminal record, USCIS will evaluate the nature and severity of the offense. They will also consider the time elapsed since the crime and whether multiple offenses exist. Applicants with minor or non-violent criminal records may still qualify but will face scrutiny.

USCIS’s Waiver Application

In some cases, individuals can apply for a waiver of inadmissibility. This waiver requires proving that denying the application would cause extreme hardship to a U.S. family member. USCIS reviews each waiver request on a case-by-case basis. It would help to have legal assistance to navigate this complex process.

3. Individuals Who Cannot Prove Their Source of Funds

Proving the lawful source of funds is a critical requirement for EB-5 visa applicants. USCIS mandates that investors show their investment capital was obtained legally. This includes providing detailed documentation tracing the funds from their origin to the investment.

Failure to prove the lawful source of funds can result in application denial. Common sources of funds include earnings, property sales, gifts, or inheritances. To back up their claims, investors must provide tax returns, bank statements, and other supporting documents.

If the source of funds is unclear or difficult to document, investors should work closely with an experienced EB-5 attorney. Attorneys can guide investors in gathering the necessary documentation and ensuring it meets USCIS standards. In cases where funds come from multiple sources, a comprehensive financial trail must be established.

4. Individuals With Prior Immigration Violations

Individuals with prior immigration violations may face challenges when applying for an EB-5 visa. Violations such as visa overstays, unauthorized employment, or prior deportation can impact eligibility. USCIS reviews these violations carefully and may consider them grounds for inadmissibility.

To address these issues, applicants should disclose all prior immigration violations upfront. Transparency is crucial in avoiding further complications. In some cases, individuals may apply for a waiver of inadmissibility, especially if the violation is minor or occurred long ago.

5. Individuals From Sanctioned Countries

Foreign investors from any country are allowed to participate in EB-5 processes. However, certain U.S. sanctions can restrict financial transactions with certain nations and individuals, making it difficult for affected investors to transfer funds legally. Sanctioned individuals may be prevented from accessing U.S. financial systems.

To address these challenges, potential investors should consult with legal experts who specialize in international sanctions. In some cases, investors may seek a specific license from the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) to proceed with their investment. However, obtaining such a license is complex and not guaranteed.

Achieve Your Green Card Goals With EB5AN

Considering how complex the EB-5 application process can be, you need expert guidance to walk you through the process. And that’s where EB5AN comes in.

EB5AN has successfully guided over 2,300 families from more than 60 countries in their journey to secure lawful permanent residency in the United States. With over a decade of experience, EB5AN prides itself on offering top-tier, low-risk EB-5 regional center projects that have consistently achieved a 100% USCIS project approval rate. Beyond our expertise in investment opportunities, we are deeply committed to providing investors with a wealth of resources, including comprehensive industry updates, educational materials, and personalized support throughout the EB-5 process.

Begin your journey with us today by scheduling a free consultation with the EB5AN team.