A Guide to Avoiding Immigration Benefit Fraud During the EB-5 Investor Visa Process

Ever since its creation in 1990, the EB-5 Immigrant Investor Program has become one of the most sought-after pathways for foreigners seeking to immigrate to the United States. With an investment of $1.05 million dollars into a job-creating commercial enterprise, or $800,000 into a business located in a rural or high-unemployment area as part of the EB-5 Regional Center Program, foreigners with eligible funds have a relatively straightforward path to obtaining a green card for themselves and their families. This also comes with the opportunity to eventually apply for naturalization as a U.S. citizen.

Alongside the rising demand for EB-5 visas across the past three decades, a dangerous criminal market with the aim of defrauding these EB-5 aspirants out of their investment money has risen in turn – an issue that’s only worsened in the digital age where misinformation runs rampant.

With this in mind, it’s important to stay educated on the potential security risks and common fraud schemes associated with the EB-5 investor program, commonly known as immigration benefit fraud. Vigilance throughout the application process is important to make sure your EB-5 procedures will go as smoothly as possible and to avoid becoming a victim of EB-5 fraud.

There are a number of ways an applicant can commit or become a victim of immigration benefit fraud during the application process, which would likely result in the rejection of their EB-5 application by USCIS.

Keep reading to learn more about the different types of EB-5 visa fraud and what you can do to ensure your own application meets USCIS guidelines to the fullest.

How to Avoid Fraudulent EB-5 Program Offers

Before sending any funds to a business in the context of an EB-5 application, it’s essential to perform due diligence on the enterprise in question to make sure it’s legitimate – especially if the EB-5 applicant is not personally involved in said enterprise’s day-to-day operations. Even if you’re a victim of fraud, USCIS can still invoke your investment in a fraudulent scheme as a valid reason to deny your investor visa application or revoke its acceptance.

Here’s a checklist on what to look for – and what to avoid – when seeking out the right investment opportunity for your EB-5 program petition.

Some fraudulent actors will advertise their business as part of the USCIS EB-5 Regional Center Program when they have not applied for the program or their approval is still pending; consult with local regulatory authorities to make sure the business in question is in fact a part of the Regional Center Program.
USCIS regional center approval, the status of which can be found on the agency’s website, is only a jumping-off point for EB-5 investor’s due diligence. Make sure to thoroughly research any business, as well as the people behind the business, before sending any funds its way.
Get the business plan, the proposal for the use of your investment funds, and any other relevant documents from a potential investment in writing to protect yourself should things go sideways. Any glaring inconsistencies between USCIS guidelines and the business’s documents may be a sign that the investment is fraudulent.
If investing in real estate development – which is a common EB-5 investment platform – you may want to ask for the construction permits and zoning approvals from the local authorities, as well as request an independent appraisal on the value of said property or piece of land when it comes time to sell.
Double check if the business owner has invested their own money in the business; if the founder isn’t putting any of their own money into the project, that may be a red flag.
Ensure that the business you’re investing in isn’t held under layers of shell companies to avoid getting caught in a shell company fraud scheme.
If an investment promoter is advertising the investment as risk-free, this could be a sign of potential fraud as all EB-5 investments require by law that you make an “at risk” investment.
Once you’ve made an investment, monitor the business’ use of funds to ensure your money is being used for EB-5-approved purposes and not to fill the pockets of the business owners or cover fund administration costs, which counts as immigration benefit fraud in the eyes of the USCIS.
It is generally advisable to have an independent financial advisor review the investment platform before you make your investment. Several independent financial advisors who operate in the EB-5 space can be found online. Make sure you find one that suits your needs.
Always remember: if it sounds too good to be true, it probably is.

Other Types of Immigration Benefit Fraud

Businesses and investment promoters may also attempt to lure you into a fraudulent investment opportunity by making false or misleading statements. Here are a few things you should avoid at all costs:

Using falsified affidavits or writing incorrect information on immigration forms and documents.
Committing identity fraud by using other individuals’ identification during the application process.
Using funds obtained illegally, such as through money laundering or other criminal activity, to fund the EB-5 investment.
Falsely representing the amount or type of jobs created by an EB-5 investment on the petition, an issue that can also be committed by the regional center itself.
Using the EB-5 program to enter the United States for purposes that may pose a risk to the country’s national security.

Methods of USCIS Fraud Detection in EB-5 Petitions

Curious about what happens if you or the business you’ve invested in commits immigration benefit fraud? Here’s a rundown of how USCIS navigates fraud claims – and what happens to applicants who’ve been found to have committed fraud on their petition.

Due to the high vulnerability of fraud in the EB-5 program, the USCIS has delegated the Fraud Detection and National Security Directorate (FDNS) to flag and investigate potentially fraudulent applications, whether requested internally by the USCIS or tipped off by an external source.

The FDNS review process begins with either a referral or a request for assistance. Referrals usually stem from a USCIS adjudicator, law enforcement agents, or automated flags from an applicant’s biometric or biographic screening data, the majority of which will be entered into the FDNS’ data system as a lead.

Requests for assistance, which can be submitted internally or externally, usually concern information on a specific individual or organization related to an application; if the FDNS finds sufficient suspicion during its initial investigation, the case is then flagged in the data system as a lead.

The FDNS will then begin a preliminary investigation into all applications classified as leads, collecting evidence that USCIS adjudicators can use to determine applicants’ eligibility for the EB-5 visa program through governments’ systems of record and other USCIS sources. From here, the FDNS will determine if the lead in question meets its suspicion threshold for fraud and if it is actionable and determinable; if so, the lead is then elevated to a case in the FDNS data system.

All applications designated as cases will then go under further review by the FDNS, which will document all findings from the investigation before ultimately determining whether the case is proven to be fraudulent or if no fraud was committed.

USCIS will hand over confirmed cases of immigration benefit fraud to the corresponding federal authorities, which may include the Securities and Exchange Commission (SEC), Federal Bureau of Investigation (FBI) and Immigration and Customs Enforcement Homeland Security Investigations (ICE HS). Once the case is passed on to the authorities, the consequences for those who committed immigration benefit fraud could be much more serious than the simple rejection of their EB-5 visa petition, and criminal charges could follow.

In Conclusion

While the U.S. federal government has implemented additional steps to prevent and identify immigration benefit fraud within the FDNS and the Immigrant Investor Program Office (IPO), it’s ultimately up to the applicant to confirm their petition is by the book and their investment of choice is legitimate.

Considering the notorious complexity of the U.S. immigration system and the significant sum of money involved in the EB-5 investor visa program, it may be wise to consult with a legal immigration expert as well as an independent financial advisor for guidance.