The EB-5 visa program was first launched in 1990 in order to allow foreign nationals an opportunity to obtain a green card in exchange for their investments in qualified real estate development projects. Several projects throughout New York have to come to fruition, thereby permitting many foreign residents an opportunity to make a new start in this country. While this program has been beneficial to both sides in the majority of cases, there have been numerous allegations of investors losing their monies due to alleged EB-5 fraud.
Recently, three separate development companies reached a settlement with the SEC over the monies provided by an estimated 90 foreign investors who feared that they had lost more than $49 million in funding. The Securities and Exchange Commission announced that the developers who were accused of misappropriation of the funds were able to fully refund the investors. According to an investigation, the developers informed their investors that their monies would be used to complete an extensive mixed-use real estate project.
It was determined, however, that the developers inappropriately channeled an estimated $20 million of the $49.5 million in investments into unapproved projects. It was also determined that the monies were used for other unapproved purposes. It was not clear whether the affected Chinese nationals had received the refunds on their investments yet or if their immigration status has been adversely affected.
It is also unknown whether the three Texas-based developers involved in these EB-5 fraud allegations will be subjected to fines or other legal consequences. New York residents who suspect the possibility they have been victims of this type of fraud understandably are concerned about how it could potentially impact their immigration status. An attorney who is experienced in this area of immigration law can provide assistance in ensuring that their rights will be protected.