Response of the Center for Immigration Studies, Washington, D.C., September 3, 2012,
to A Request for Comments by the Department of Homeland Security
on the Collection of Information Through USCIS Forms I-924 and I-924A (Both Related to the EB-5 (Immigrant Investor Program)
Federal Register Vol. 77, No. 162, Tuesday, August 21, 2012/Notices p. 50520 OMB Control # 1615-0061
These comments are submitted on behalf of the Center for Immigration Studies, a non-partisan think tank in Washington, D.C., that concentrates on the impact of immigration on U.S. systems; the writer is David North, a fellow at CIS. The FR notice is here.
Policy Context, Generally. These forms are filled out by what are usually private, for-profit firms that want to handle a small subset of investments by aliens in the United States; if the investments, usually half a million dollars each, are approved by USCIS, the investor, by definition an otherwise inadmissable alien, and all the members of his or her immediate family, all otherwise inadmissable to the United States, are put on paths to green card status. The firm that has filed the I-924 earlier then is in the position of handling the investment for the alien — who typically does nothing but write a check — while the firm collects fees from various interested parties.
These middle-man entities are called regional centers, and one has to file the I-924 form successfully to operate as a regional center.
Those filing the I-924 are thus seeking to get their hands on government-facilitated investment funds. Routinely these moneys are invested in projects that could not be funded were it not for the visa-granting nature of the investments. The I-924 operators are thus working with a form of federal funds.
This is an extremely controversial program and the form, the I-924, unlike most forms handled by USCIS, is often rejected by USCIS staff on the grounds that the application does not meet legal requirements and/or appears to be fraudulent in nature. Bearing in mind that USCIS routinely says yes to 95-99 percent of the forms before it, depending on definitions, decisions on this form, during the first nine months of the current fiscal year, according to the agency's own statistics, were as follows:
- Total I-924 decisions made by staff, FY 2012 quarters 1-3: 74
- Approvals: 30
- Denials: 44
- Percentage of denials: 59.5 percent1
Clearly the career staff — if not the political leadership of the agency, which likes the EB-5 program — is faced with a troublesome set of applications. The agency's request to simply continue the use of the form in its current format is puzzling, given both the number of scandals that have arisen in connection with the program, and the remarkable percentage of denials recorded in the agency's own statistics.
There are many other indications, besides these statistics, that the EB-5 program is a troubled one — for instance, there was a front-page exposé of some EB-5 investments in the usually pro-migration New York Times.2
This is just one of the multitudinous problems and scandals in the EB-5 program described in a comprehensive report by the Center for Immigration Studies, entitled "The Immigrant Investor (EB-5) Visa: A Program that is, and Deserves to be, Failing".
How Revision of the I-924 Form Can Help Prevent Abuse of This Much-Abused Program. One of the most notable failures, which caused USCIS to revoke the charter of an existing regional center, came in El Monte, Calif. According to an industry information service, routinely favorable to this program, EB5info.com:
It happened again, and it probably won't be the last time.
The El Monte Regional Center in El Monte, California, just got the boot from USCIS. In the agency's own words, the regional center was "no longer promoting job creation or the kind of local economic development for which it was initially certified to do."
In a CIS blog we summarized the problems of the El Monte Regional Center in this way:
- "The developers had been accused of committing felonies and at one point were placed under arrest.
- "The developer had filed for bankruptcy.
- "Bang Zhao Lin who purchased the project's original developer, had never developed property in the United States and had zero real estate experience outside of Asia.
- "An executive with the developer had been named as a defendant in another EB-5-related lawsuit in which investors were allegedly swindled."
Many of these problems might have been avoided had USCIS, and the two investors who put money into the program, been aware of the records of the people running the El Monte regional center, and much of the needed information would have been available for all to see were the I-924 form to be revised to include questions about the individuals involved in the proposed regional center. No such line of questioning is included in the current form.
My precedent is a document that everyone reading this response will have completed, the SF 171; since the regional center operators are working with a kind of federal funds, their decision-makers should be asked the same questions as would-be federal employees. These are the questions that should be asked of all regional center decision-makers, all taken from the SF 171:
37 Are you a citizen of the United States? (In most cases you must be a U.S. Citizen to be hired. You will be required to submit proof of identity and citizenship at the time you are hired.) If "NO", give the country or countries you are a citizen of:
NOTE: It is important that you give complete and truthful answers to questions 38 through 44. If you answer "YES" to any of them, provide your explanation(s) in Item 45. Include convictions resulting from a plea of nolo contendere (no contest). Omit: 1) traffic fines of $100.00 or less; 2) any violation of law committed before your 16th birthday; 3) any violation of law committed before your 18th birthday, if finally decided in juvenile court or under a Youth Offender law; 4) any conviction set aside under the Federal Youth Corrections Act or similar State law; 5) any conviction whose record was expunged under Federal or State law. We will consider the date, facts, and circumstances of each event you list. In most cases you can still be considered for Federal jobs. However, if you fail to tell the truth or fail to list all relevant events or circumstances, this may grounds for not hiring you, for firing you after you begin work, or for criminal prosecution (18 USC 1001).
38 During the last 10 years, were you fired from any job for any reason, did you quit after being told that you would be fired, or did you leave by mutual agreement because of specific problems?
39 Have you ever been convicted of, or forfeited collateral for any felony violation? (Generally, a felony is defined as any violation of law punishable by imprisonment of longer than one year, except for violations called misdemeanors under State law which are punishable by imprisonment of two years or less.)
40 Have you ever been convicted of, or forfeited collateral for any firearms or explosives violation?
41 Are you now under charges for any violation of law?
42 During the last 10 years have you forfeited collateral, been convicted, been imprisoned, been on probation, or been on parole? Do not include violations reported in 39, 40, or 41, above.
43 Have you ever been convicted by a military court-martial? If no military service, answer "NO"
44 Are you delinquent on any Federal debt? (Include delinquencies arising from Federal taxes, loans, overpayment of benefits, and other debts to the U.S Government plus defaults on Federally guaranteed or insured loans such as student or home mortgage loans.)3
Were these questions to be added to the current form it might reveal some useful information to the government; in cases where the questions were answered dishonestly, and this becomes known, it would help prosecutors file fraud cases.
Should anyone want to speak to me about any of this, the office address is CIS, 1629 K Street, NW, Suite 600, Washington, DC, 20006, and my e-mail address is [email protected].
David North
End Notes
1 These statistics were released by USCIS on July 26, 2012, and were reported in the immigration bar's trade paper, Interpreter Releases, in its August 6, 2012, issue, on p. 1519. For
an electronic reference, see http://info.eb5info.com/bid/150656/USCIS-EB-5-Visa-Stakeholders-Call-201.... Both the agency and the trade paper show the raw numbers for the first three quarters of the year, but neither summarize those numbers nor shows percentages, perhaps because institutional interests would not suggest such a clear-cut format.
2 See "Rules Stretched as Green Cards Go to Investors", by Patrick McGeehan and Kirk Semple, The New York Times, December 19, 2011, http://www.nytimes.com/2011/12/19/nyregion/new-york-developers-take-adva....
3 These questions are reprinted from Form SF 171, with the boxes for "yes" and "no" removed.