Visa Roundup: News About R-1s, an E-2, and Some EB-5s

By David North on December 23, 2022

As the year winds down, we have a collection of news about various types of visas.

R-1. The small category of non-ministerial religious workers is scheduled to be re-authorized through September 30, 2023, by its inclusion in the huge omnibus spending bill likely to pass Congress soon. These are nonimmigrant visas for special religious workers; the authorization has never been permanent and it expired at the stroke of midnight on December 15; it was then extended for a week later the next day in a continuing appropriations resolution (CR) passed by Congress and signed by the president.

I continue to be puzzled about why this small category of nonimmigrants has not been granted permanent authorization; it is non-controversial and in FY 2020 caused the issuance of 702 visas. Members of the clergy are covered by other parts of the immigration system; R-1s are choir directors and other auxiliary religious workers. Though, there may be hidden problems within the program that have not come to light.

E-2. These are treaty investors and they, too, and arrive on nonimmigrant visas; they are essentially alien businesspeople who run small to medium-sized operations big enough to create some economic activity, but not large enough to warrant the permanent green cards that go with the EB-5 (Immigrant Investor) program. It is run by the State Department, which has no State-side staff to monitor the program.

E-2s are scattered around the country, as are the R-1s, and do not cause the major economic problems created by the larger, more concentrated, and more controversial H-2A (farm labor), H-2B (non-ag, non-skilled), and H-1B (college graduate) foreign worker programs.

A former user of the E-2 program, however, showed up in the December 18 issue of The New York Times; he is Phil O’Brien, a UK citizen who owns a small-scale news site in Hell’s Kitchen, a neighborhood on the West Side of Manhattan near the Times headquarters. The Times headline tells why the paper ran a story about him: “Another Sign of Hard Times in Local News: A Declined Visa. Phil O’Brien, a Briton who has run a Manhattan publication for several years, had his visa denied because immigration officials deemed his struggling business ‘marginal.’”

According to the paper, the website, entitled W42ST, was a reasonably prosperous activity until Covid hit, and then it became “marginal” and for that reason O’Brien could not get his E-2 visa renewed. An E-2 visa is issued only if the State Department finds that it will create a useful amount of State-side economic activity, and it decided that this was no longer the case for O’Brien’s venture.

The Times’ focus was, however, not on immigration policy, it was on local journalism: “Across the country, local newsrooms have hit hard times. Hardly a week passes without news of another paper closing.”

The denial of the visa extension should not be newsworthy — this should happen routinely if E-2 businesses decline. This was, in effect, a story of the government doing what it should be doing in one of our all-too-numerous nonimmigrant worker programs, and it caught the eye of the Times only because it related to the paper’s own immediate neighborhood.

EB-5. Speaking of immigrant investors, the continuing drama of yet another EB-5 scandal, involving, yet again, Chinese investors saying that they are being fleeced by U.S. operatives has been reported by Law360.

Two paragraphs from the Law360 story are about all we need here:

The 24 Chinese investors filed what is the second suit in as many months over an EB-5 regional center-funded hotel resort project, alleging they were repeatedly told by Coconut Beach/Hawaii LLC, Forefront EB-5 Fund (HCR) LLC and two other members that, up until 2022, work on the project was progressing. In reality, the entities lost the property to foreclosure in 2019.

And by the time the litigants learned of the project's true status from an attorney litigating another unbuilt EB-5 project in Chicago involving overlapping entities, the property owner was in the middle of bankruptcy proceedings with no record of where investors' funds had gone, per the complaint.

Douglas Litowitz, whom we have mentioned in the past, is the lawyer who saw a connection between this project in Hawaii and the one in Chicago. We do not know the names of the inattentive Chinese investors who did not notice the foreclosure for years.

EB-5 just continues to grind out scandals on investors losing their shirts, and often their hoped-for green cards, and rarely, if ever, do we find that the agency running the program, USCIS, has noticed the fraud; it is usually the Securities and Exchange Commission or a non-governmental lawyer.