How a Qualified EB 5 Attorney Helps in Legal Risks with Regional Centers

In a multitude of cases, the success of requesting an EB5 investment visa resides in the selection of the regional center. Regional centers are practically the very foundation of the EB 5 concept and, based on the success of the investment, the foreign investor may or may not attain naturalization. And that is the reason why there are so many questions related to regional centers which only a specialized EB5 attorney could properly answer.

Characteristics of Regional Centers
There are some general facts that define regional centers and that you should be informed about.

•     Regional centers are established by local American business people in order to attract investment capital to serve current or future business venture needs.
•     Types of investment may range from solar energy plants to commercial real property.
•     In most cases, such ventures are not likely to attract investors as they are not supported by a great history of track records.
•     The financial returns are generally modest.
•     They accept foreign investors in the EB5 investment visa program.
•     There are 150 USCIS regional centers throughout the United States.
•     The selection of the most adequate center involves a complex evaluation process handled by an EB5 attorney in the majority of cases.
  

Legal Risks with Regional Centers
There certain issues which may trigger legal risks related to the selected regional center. Here are some of the most common EB investment visa issues that an EB5 attorney identifies in that respect:

•     The methodology employed by that specific regional center to create the ten required jobs.
•     The history of the center for immigration petitions related to the EB5 Investment visa.
•     Securities and Exchange Commission compliance, otherwise known as SEC compliance.
•     Litigation cases in which the center or principles may be involved.
•     Any significant changes in the business plan.
•     Systemic risks such as changes in the immigration law or US tax law.
  

Financial Risks with Regional Centers
Although the EB5 investment visa program is not a typical investment opportunity, it is still an investment and any investment involves certain financial risks which can or cannot be predicted or estimated by the EB5 attorney. There are obviously factors which need to be assessed as to the financial risks they may entail and here are some examples:

•    Equity or loan based investment involving advantages and disadvantages of each case as well as investment period.
•     Operating history of the current project such as secured funding to date or the number of investors.
•     Organizational issues such as the pros and cons of a limited partnership or a limited liability company, voting rights for members, and personnel turnover.
•     Yield on investment including past rate on return to investors and current year rate on return.
•     An impartial assessment of the principals including history, credentials, Dun and Bradstreet report, and experience with immigration, job creation, SEC compliance, and many more.
•     Exit options including time until the investment is liquidated, the percent of recovered investment, options in case of failure to create jobs, and other similar factors.
•     Financial strength and underlying business entity including debt equity ratio, balance sheets, cash flow statements, operating profit, strategic relationships, and other factors must be evaluated and analyzed by the EB5 attorney.
•     Competition risks including competitor evaluation and market trends.
•     Financial transparency including the access of the investors to financial statements and reports and the frequency of the reports to investors.