What Is EB-5 Fraud?
The EB-5 Immigrant Investor Program was designed to give immigrants an opportunity to earn a green card visa and residency status if they make a substantial investment in a United States business that will create jobs within the country.
Sadly, this program has been exploited by business owners who misrepresent themselves as EB-5 opportunities in the hope of procuring investments from foreigners who are seeking citizenship in the United States.
The Investment Scheme
A business committing EB-5 fraud applies to become a regional center for the EB-5 program that sponsors investment opportunities for foreigners interested in coming to the U.S., although in some cases, a business won’t even bother to masquerade as a regional center and simply markets itself as an EB-5-qualifying business.
The problem is that these businesses aren’t being vetted to determine their legitimacy.
Once a business has gained the trust of a foreign investor, it will then misuse the investment and fail to create jobs for U.S citizens or put the money back into the economy.
This use disqualifies the foreign investor from an EB-5 visa, as his or her investment did not meet EB-5 program requirements. When this happens, not only do the investors lose their money, but they fail to secure the immigration status they were seeking.
Warning Signs of an EB-5 Scam
The Securities and Exchange Commission (SEC) takes EB-5 fraud very seriously—so much so that it has issued red flags for foreign investors to be cautious of when seeking an EB-5-qualifying business. Some of these include being leery of private investments (or those not designated as regional centers), the promise of low-risk, high-return investments, and guaranteed residency status within the U.S.
Contact a Securities Fraud Whistleblower Attorney
If you know of an EB-5 investment scam in action and are considering becoming a whistleblower, reach out to an experienced attorney with Meissner Associates today.
We can help you file your tip with the SEC while protecting your identity and increasing your chances of receiving an award. You can schedule a free consultation by giving us a call at 1-866-764-3100 or filling out our secure contact form below.