The EB-5 Visa Program is a program that allows foreign investors to receive a United States green card through an investment in a U.S. enterprise. Investors must fund certain EB-5 projects approved by the USCIS. The EB-5 program requires that the investment is made at risk, meaning the investor assumes the risk involved in making the investment.
What the EB5 at Risk Requirement Means
An EB-5 at-risk requirement refers to the obligation for EB-5 investors to invest their capital in a new commercial enterprise subject to risks. Investors have the opportunity to choose from multiple EB-5 projects to find a promising investment opportunity. As with any other business endeavor, the investor is at risk of losing or gaining on the investment.
This risk must be assumed by the investor and no other person or entity, and they should not be guaranteed any certain outcome. The at-risk requirement helps encourage investors to choose projects and enterprises that have the highest potential for success. This can be beneficial for both the US economy, the investor, and the EB-5 program as a whole.
How To Minimize Risk
Some investors can find it stressful to make an at-risk investment. Here are some ways to possibly minimize risk:
Work With a Regional Center
Regional centers can be less risky than making an independent investment. Investors can research a regional center’s track record to see their success rate. Regional centers may also offer various EB-5 projects at once, offering investors many options to choose between. The USCIS also counts both indirect and direct jobs towards the job creation requirement. With direct investments, only direct full-time employees count towards the requirement. This makes it easier to meet the program requirements and eventually achieve citizenship.
Choose a Promising Project
When researching different EB-5 projects, investors should look for a project with a sound business plan, market research, and financial projections. Investors should also research the number of jobs that the project is projected to create once completed. This can help them select a project that is viable and sustainable, which can minimize their risk and help them meet the job creation requirement.
Avoid Guaranteed Returns
Investment opportunities that offer guaranteed returns or are advertised as not having risk likely won’t meet the at-risk requirement. Investors should avoid projects that promise risk-free returns because it puts their ability to participate in the program at risk.
Consequences of Not Meeting the Requirements
There are serious consequences of failing to meet the at-risk requirement. The USCIS closely evaluates EB-5 applications to make sure the investor is complying with all guidelines as well as the at-risk requirement. If an investor fails to meet this requirement, their I-526 petition may be denied. This means the investor will not receive a conditional green card or be able to participate in the EB-5 program. If the USCIS discovers that the investment was not made properly, the investor may not receive through the EB-5 program.
Research EB-5 Projects To Find the Right Fit
The EB-5 at-risk requirement helps safeguard the integrity of investments and helps stimulate economic growth in the U.S. By making informed decisions and choosing a viable, job-creating enterprise, investors can fulfill the project requirements and contribute to the US economy.
Failure to meet the at-risk requirement may result in USCIS scrutiny and rejection from the EB-5 program. Some investors may choose to invest in a regional center because of their ability to pool investments from multiple investors. This can help reduce risk and help investors get an EB-5 green card and eventual U.S. citizenship. Seek the services of a reputable regional center to get started today.