EB5: Why Is It So Complicated To Create A Simple EB5 Project ?
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Fellow EB5 practitioners,

As I read the discussions in this group and elsewhere on the internet, I have started to ask myself some fundamental questions about the EB5 program.

The USCIS created the EB5 program with a simple goal in mind, to generate full time permanent jobs for qualified U.S. residents.

In order to avoid appearing that the U.S. was in the business of "selling" green cards to foreign investors, USCIS imposed the additional restriction that 100% of the funds invested had to be at risk.

A reasonable entrepreneur would see these 2 requirements as the necessary elements of a simple business model i.e. create 10 full time permanent jobs + 100% of invested capital must be at risk and actually invested in the new business.

Somewhere along the way the EB5 process became much more complicated and prone to modifications that have attracted scrutiny from the USCIS and generated less than favorable results.

Somewhere along the way the idea of an immigrant investor starting a business that put 10 eligible employees to work gave way to a labyrinthine process that even the USCIS now finds difficult to review, examine, understand and approve.

Could the answer to the current issues be the K.I.S.S. principle ? ( Keep It Simple, Stupid ! )

You comments, as always, are encouraged !

Marc S Hyman JD
Pacific West Investor Services
EB5 Advisors
Santa Barbara California
E:Marc.Hyman@yahoo.com
C:805.288.2269

回复: Interesting Discussion on Linkin about EB-5 Projects

John Gezelius • In the beginning there was The Project - and we saw that it was good. And it was fruitful and the jobs did multiply so that there were 10 jobs unto The Project. Thus endeth the initial $1,000,000 project.

And then the rules did change and allow and foster investment in depressed areas, and to foster such investments, a blessing was bestowed to allow a $500,000 investment - and this was good - up to a point. Because the job still required $1,000,000 to complete. And because the job count was tied to the number of investors, the $1 million project now required two (2) investors, each of which had to get 10 jobs out of the deal for a total of 20 employees. And oh, by the way, we now need a partnership agreement for the two partners invested at the $500,000 level.

And time passed and it became apparent that direct jobs were not forthcoming. And the investors said "Oh come accountants and lawyers, how can I fix this plague of not enough direct jobs?" and thus the notion of induced and tenant occupancy came to pass.

And the accountants and lawyers, seeing opportunity in the program, said "If a little EB5 investment is good, then lots more will be lots better. How can we upscale this?" And this idea became the Regional Center.

And now, on the fourth day, the Service became confused and asked "What is this creature called the Regional Center. We do not understand it so we must regulate it." And thus flowed work for economists and plan writers...

In all seriousness, the projects outgrew the small one-on-one business model and as more money was needed the projects grew in size and scope. The Service was now in the business model evaluation business which was not anything that it was familiar with. The EB5 model grew faster that the ability of the Service to learn. The Service reacted as Congress directed and not in a smart, business savvy way. Add to that people who were real estate wheelers and dealers (vs. immigration professionals) who simply saw numbers and sacks of money and the wheeler dealer real estate developer methods came into the picture.

回复: Interesting Discussion on Linkin about EB-5 Projects

Donald Safranek • Marc, our firm Wert-Berater, Inc. (http://www.wert-berater.com) provides feasibility studies. We have recently completed several reports on EB-5 projects. Of a $40M project, there are $10M in junk fees the developer adds in trying to hit a home run taking money from EB-5 investors. When we explain to them that the fees cannot be included they do not seem to understand that adding so much makes a project infeasible.

Also, we get about 50 calls per month from EB-5 people. Of those calls about 49 have no money and want us to work for free in the hopes that we will be paid when the project is funded. Because of the conflict of interest we do not provide studies having a financial interest in any project.

Based on our experience, it is the developers who often make the process impossible. I think the term is "Greed". I guess 2008 did not teach enough lessons.

The problem seems to be too much concern over the "going in strategy" and how much can be taken on the front end instead of "earned" on the exit.

回复: Interesting Discussion on Linkin about EB-5 Projects

Marc S. Hyman JD • Hello Donald,

Thank you posting your comment in response to my question.

As the number of petitions increase dramatically, USCIS will be hard pressed to deliver timely adjudications on complex deals.

The key to getting past the I526 stage and reaching successful I829 adjudications seems to be the simplicity of the project.

Complex projects with multiple layers of management, multiple corporate entities, seemingly guaranteed returns or exit strategies attract USCIS scrutiny and result in significant delays.

The RC structure is not a justification for treating the project like a traditional syndication deal where the developers, GP's and agents are handsomely rewarded whether or not the project delivers green cards or profits.

The RC structure is a unique opportunity that allows indirect jobs to be counted in the EB5 job creation tally. It is not a green light for any and all synication deals. Syndicated deals already have a market through Wall Street and licensed brokers. RC deals need to be treated differently by investors, developers, practitioners and those who promote RC deals.

As the delays in adjudications increase perhaps more streamlined deals will appear.

Thanks again.

Marc S Hyman JD
Pacific West Investor Services
EB5 Advisors
Santa Barbara CA
805.288.2269

回复: Interesting Discussion on Linkin about EB-5 Projects

好贴！

回复: Interesting Discussion on Linkin about EB-5 Projects

EB-5黑马 说:

Of a $40M project, there are $10M in junk fees the developer adds in trying to hit a home run taking money from EB-5 investors. When we explain to them that the fees cannot be included they do not seem to understand that adding so much makes a project infeasible.

点击展开...

4000万的EB-5的项目，项目方要收费1000万。然后，靠就业报告牵强附会凑足就业。80个投资人的项目，又是中介的最爱，在国内忽悠几十个投资人不是个问题。 投资人递交526申请以后，移民局看出了项目方的圈套，就把投资人的526申请吊着不批准。

这就是经典的区域中心项目。

回复: Interesting Discussion on Linkin about EB-5 Projects

有些一天到晚黑区域中心的不用嘴说话，但是我们投资人都会用脑思考。

回复: Interesting Discussion on Linkin about EB-5 Projects

EB-5黑马 说:

Donald Safranek • Marc, our firm Wert-Berater, Inc. (http://www.wert-berater.com) provides feasibility studies. We have recently completed several reports on EB-5 projects. Of a $40M project, there are $10M in junk fees the developer adds in trying to hit a home run taking money from EB-5 investors. When we explain to them that the fees cannot be included they do not seem to understand that adding so much makes a project infeasible.

Also, we get about 50 calls per month from EB-5 people. Of those calls about 49 have no money and want us to work for free in the hopes that we will be paid when the project is funded. Because of the conflict of interest we do not provide studies having a financial interest in any project.

Based on our experience, it is the developers who often make the process impossible. I think the term is "Greed". I guess 2008 did not teach enough lessons.

The problem seems to be too much concern over the "going in strategy" and how much can be taken on the front end instead of "earned" on the exit.

点击展开...

请问从哪可以看出这是区域中心的项目，这个开发商显然没有和任何一个区域中心关联。

回复: Interesting Discussion on Linkin about EB-5 Projects

EB-5黑马 说:

4000万的EB-5的项目，项目方要收费1000万。然后，靠就业报告牵强附会凑足就业。80个投资人的项目，又是中介的最爱，在国内忽悠几十个投资人不是个问题。 投资人递交526申请以后，移民局看出了项目方的圈套，就把投资人的526申请吊着不批准。

这就是经典的区域中心项目。

点击展开...

谢谢你的例子，这个例子正好说明区域中心和项目律师（包括前期规划设计者）拒绝这种带有junk money 的项目。连可行性分析研究都无法通过。

这种菜鸟开发商，没有区域中心的支持，是不是只能搞独立直投或者合伙直投？

回复: Interesting Discussion on Linkin about EB-5 Projects

visatousa 说:

谢谢你的例子，这个例子正好说明区域中心和项目律师（包括前期规划设计者）拒绝这种带有junk money 的项目。连可行性分析研究都无法通过。

这种菜鸟开发商，没有区域中心的支持，是不是只能搞独立直投或者合伙直投？

点击展开...

这种项目只能借用区域中心的招牌，躲在虚假的间接就业的经济报告的背后，使用夸大的就业人数来欺骗EB-5投资人。这种骗术是不用，也没有可行性报告分析的，因为根本行不通。这种项目根本不能靠直接就业做项目，就业人数根本就不够EB-5投资人用的。你可以介绍一下，你推广的哪个项目有给投资人展示其可行性报告了？？？

给你一个基本原则。能做直接投资的EB-5项目，肯定是可以成功的区域中心项目。能做区域中心的EB-5项目，不一定能做直投EB-5.

回复: Interesting Discussion on Linkin about EB-5 Projects

每个项目都有商业计划书，并都要经过可行性研究，投资者都可以看到。

我也送你一个基本常识：能做区域中心的EB-5项目，没有必要“自废武功”去做直投EB-5。

回复: Interesting Discussion on Linkin about EB-5 Projects

visatousa 说:

每个项目都有商业计划书，并都要经过可行性研究，投资者都可以看到。

我也送你一个基本常识：能做区域中心的EB-5项目，没有必要“自废武功”去做直投EB-5。

点击展开...

告诉你一个常识，有商业计划书，并不等于做过可行性报告，经过第三方验证。我引用的那个专业人士就是说，有些项目方商业计划书里，25％的费用都是项目方／区域中心的杂费，根本不符合EB-5的要求,只是项目方要一夜暴富的黄粱梦。

有些项目方的商业计划书是用来忽悠投资人的。这些商业计划书在中介的手里就摇身一变，成为了混EB-5永久绿卡的九阴真经了。

回复: Interesting Discussion on Linkin about EB-5 Projects

visatousa 说:

我也送你一个基本常识：能做区域中心的EB-5项目，没有必要“自废武功”去做直投EB-5。

点击展开...

我们的项目曾经被批准为区域中心模型，400万的投资，按模型计算，直接和间接就业是268个就业。就是说我可以召集20人投资人，1000万的资金，就业入数“超过移民局要求34％”。

因为我们的项目用过两个就业模型计算间接就业人数，区域中心的模型的就业人数比我另外的模型的多了100多个间接就业。因为这个发现才让我对区域中心的就业模型产生怀疑。

我也想一夜暴富的美梦，100多个就业，就是500万美金到手。因为移民局规定项目有风险，最后项目失败，投资人也无法起诉项目方的。 只能吃哑巴亏的。

最后我是有心没胆，就自废武功，放弃区域中心模型，改做直接就业直接投资项目。我们还是赚良心钱吧。

回复: Interesting Discussion on Linkin about EB-5 Projects

你只能用一种就业计算模型，就是移民局批准区域中心时用的那种。

你根本不需要研究，也不可以使用两种就业模型。

现在才知道，你这个“自废武功”的行为，原来是源自您的无知啊！

别看“九阴真经”了，你该看看“辟邪剑谱”，免得再次走火入魔。

回复: Interesting Discussion on Linkin about EB-5 Projects

你根本就是无知。你知道你们当初推广的日内瓦湖酒店扩建项目的就业模型吗？（不用说他们项目2009年召集的投资人，3年后，酒店根本就没有扩建，829的下场了？）

在2011年3／17日前，移民局没有强调模型的一致性，所有我先选择可以控制就业风险的IMPLAN直接就业输入模型，做个就业报告。后来移民局要求就业模型和区域中心一致，区域中心又给出了一个就业报告。同样的项目，就业报告的结果却不一样。

回复: Interesting Discussion on Linkin about EB-5 Projects

你的项目和该区域中心别的项目没有关系，只是确定了一个约定的方法。

不同的就业模型基于其背后的区域经济数据库不同，加上时间上的差异，不管最终需求乘数还是间接就业乘数，导致最终结果存在少许误差也是正常的。正因为以上缘故，移民局不会让你自己去选择更有利于你的计算方式，而是当初批了用什么方式，将来就只能用这种计算方法。

回复: Interesting Discussion on Linkin about EB-5 Projects

别再听风就是雨，有些话在哪种场合无法表达清楚，也不是代表他们的真实意图。会议纪要、备忘录甚至是手册，都还不称之为法律。所以在USCIS内部尚没有一个长期被接受的标准被应用在与区域中心相关的个案中。

其审批标准也是在实践中逐步形成的，同时并非全部USCIS审判官对适用标准的认定都与执业律师一致。

投资在一个指定区域中心的EB5投资者不被要求依赖直接创造就业机会的证据，可以在他们申请永久居民的申请中包含合理方式计算出来间接创造就业的证明。这个证据通常是经济学家专业分析的模式，如RIMSII、IMPLAN、REDYN等。EB-5区域中心方案的这一特征被视为是对作为创造就业的证据标准的放松。

这个和有没有“良心”没有半毛钱的关系！

回复: Interesting Discussion on Linkin about EB-5 Projects

visatousa 说:

你的项目和该区域中心别的项目没有关系，只是确定了一个约定的方法。

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确实我们的项目和区域中心的其他项目没有什么关系，但是我们不愿意和有欺诈的项目在同一个区域中心下面，不希望染上一条臭鱼搅的一锅腥。

我想问，你这位经验丰富的移民中介，如果你的投资人投资的项目，526批准过了以后，项目根本没有按商业计划启动，你的投资人829的前途未卜，你作为中介，能为你的投资人做什么？