EB-5 Lawful Source of Funds

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Gray International (Gray) is an international network of public accounting and consulting firms based in the U.S., Hong Kong, China and Europe. Gray was started over 10 years ago in the U.S. (via its predecessor) and took the form of Gray International in 2013 as the result of the networking of multiple independent practices and professionals.

Gray provides international accounting and compliance solutions in the U.S., Americas, Asia and Europe. Gray focuses on U.S. accounting, tax, and governmental compliance for multinational companies, investors, U.S. persons living overseas and foreign investors and companies investing in or moving to the U.S.

Gray also consults on compliance with U.S. laws for businesses and financial institutions overseas such as the Foreign Corrupt Practices Act (FCPA) and the Foreign Account Tax Compliance Act (FATCA), the IRS Offshore Voluntary Disclosure Program, and the Program for Non-Prosecution Agreements or Non-Target letters for Swiss Banks.

Grays principals, partners, and employees have served clients worldwide. Gray has offices in Geneva, Hong Kong, Seattle, Shanghai and plans to open an office in Singapore in late 2013.

Grays U.S. public accounting firm (Gray CPA, PC) is registered with the U.S. Public Company Accounting Oversight Board and is a member of the American Institute of Certified Public Accountants and the Center for Audit Quality.

For more information about us, please visit us at:

www.grayintl.com

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EB-5 Lawful Source of Funds

  1. 1. EB-5 LAWFUL SOURCE OF FUNDS REPORTING Overview of our Immigration Services International Accounting & Compliance GENEVA          |          HONG  KONG        |          SEATTLE        |          SHANGHAI        
  2. 2. LEGAL NOTICE IMPORTANT LEGAL INFORMATION PLEASE READ This  presentation  is  prepared  for  general  guidance  only,  and  does  not  constitute  the  provision  of  accounting,    legal   or  tax  advice  in  any  manner,  written  tax  advice  under  U.S.  Internal  Revenue  Service  Circular  230,  or  any  professional   advice  of  any  kind.  “Gray  International”  or  “Gray”  refers  to  Gray  CPA,  PC  (a  U.S.  CertiIied  Public  Accounting  Iirm)  and   Gray  International  Ltd  (a  Hong  Kong  Limited  Company).     The  information  provided  in  this  presentation  should  not  be  a  substitute  for  consultation  with  qualiIied   professionals  who  understand  your  situation,  as  it  will  differ  from  others.  In  addition,  when  making  any  tax  planning   decisions  you  should  consult  with  your  own  legal,  tax,  accounting  and  other  professional  advisors.     This  presentation  has  been  provided  as  a  courtesy,  and  therefore  while  care  has  been  executed  in  the  preparation  of   this  information  Gray  CPA,  PC  (U.S.),  Gray  International,  Ltd.  and  all  of  their  afIiliates  make  no  representations  as  to   its  completeness,  accuracy  or  the  timeliness  of  the  information  and  takes  no  responsibility  to  update  this   information,  such  information  is  being  provided  without  warranty  of  any  kind.     IRS  Circular  230  notice:  Tax  advice,  if  any,  included  in  this  communication  (including  any  attachments)  is  not   intended  or  written  to  be  used,  and  cannot  be  used,  by  the  recipient  for  the  purpose  of  avoiding  penalties  that  may   be  imposed  under  the  U.S.  Internal  Revenue  Code  or  by  any  other  governmental  tax  authority.         ©  2013  Gray  CPA,  PC  and  Gray  International  Ltd.  with  all  rights  reserved,  this  document  shall  not  be  reproduced  or   distributed  without  the  express  written  permission  of  Gray  CPA,  PC  or  Gray  International,  Ltd.     For  more  information  about  us,  please  visit  us  at  www.grayintl.com.   International   Accounting &   Compliance  
  3. 3. WHO WE ARE OUR  PROFILE   Gray  International  (“Gray”)  is   an  international  network  of   public  accounting  and   consulting  Iirms  based  in  the   U.S.,  Hong  Kong,  China  and   Europe.  Gray  was  started  over   10  years  ago  in  the  U.S.  (via  its   predecessor)  and  took  the   form  of  Gray  International  in   2013  as  the  result  of  the   networking  of  multiple   independent  practices  and   professionals.     Gray  provides  international   accounting  and  compliance   solutions  in  the  U.S.,  Americas,   Asia  and  Europe.  Gray  focuses   on  U.S.  accounting,  tax,  and   governmental  compliance  for     multinational  companies,   investors,  U.S.  persons  living   overseas  and  foreign  investors   and  companies  investing  in  or   moving  to  the  U.S.       Gray  also  consults  on   compliance  with  U.S.  laws  for   businesses  and  Iinancial   institutions  overseas  such  as   the  Foreign  Corrupt  Practices   Act  (FCPA)  and  the  Foreign   Account  Tax  Compliance  Act   (FATCA),  the  IRS  Offshore   Voluntary  Disclosure  Program,   and  the  Program  for  Non-­‐ Prosecution  Agreements  or   Non-­‐Target  letters  for  Swiss   Banks.       Gray’s  principals,  partners,   and  employees  have  served   clients  worldwide.  Gray  has   ofIices  in  Geneva,  Hong  Kong,   Seattle,  Shanghai  and  plans  to   open  an  ofIice  in  Singapore  in   late  2013.                                                                                                                               Gray’s  U.S.  public  accounting     Iirm  (Gray  CPA,  PC)  is     registered  with  the  U.S.  Public   Company  Accounting   Oversight  Board  and  is  a   member  of  the  American   Institute  of  CertiIied  Public   Accountants  and  the  Center   for  Audit  Quality.     For  more  information  about   us,  please  visit  us  at:       www.grayintl.com     International   Accounting &   Compliance  
  4. 4. WHAT WE DO OUR SERVICES AUDIT AND ATTEST SERVICES INTL. FORENSIC ACCOUNTING U.S. TAX COMPLIANCE U.S. FATCA COMPLIANCE INTL. TAX STRUCTURING U.S. FCPA COMPLIANCE International   Accounting &   Compliance  
  5. 5. WHAT WE DO OUR  PRACTICE  AREAS   AUDIT  AND  ATTEST  SERVICES   INTL.  FORENSIC  ACCOUNTING   U.S.  TAX  COMPLIANCE   Our  experienced  auditors  provide   extensive  experience  auditing  public   and  private  companies  in  the   developed  and  developing  markets.       Let  us  put  our  extensive  experience   operating  in  the  U.S.,  Asia,  Europe  and   the  Americas  to  work  for  you.     Our  forensic  accounting  services  are   designed  to  providing  vigilance  before   the  fact,  reconstructing  and  tracing   records  after  the  fact,  and  preparing   for  trial  once  the  Iindings  are  made.     Our  team  of  experts  are  available  for   worldwide  engagement.   U.S.  FATCA  COMPLIANCE   INTL.  TAX  STRUCTURING   Gray  provides  extensive  U.S.  tax   compliance  solutions  to  clients   worldwide.  We  work  with  individuals,   family  ofIices,  investors,  Iinancial     institutions,  multinational  companies   and  domestic  (U.S.)  businesses.       Let  us  guide  you  through  the  maze  of   complex  U.S.  tax  compliance.     No  single  piece  of  U.S.  legislation  will   have  a  larger  impact  on  foreign   Iinancial  institutions  and   intermediaries  in  the  next  5  years  as   FATCA.       Let  us  help  you  assess  how  this  will   impact  your  organization  and  how  to   implement  a  practical,  affordable   solution.   In  today’s  global  landscape   international  tax  structuring  and   planning  has  never  been  more   important.       From  transfer  pricing,  treaty   compliance,  withholding   minimization,    estate  planning  and   domiciliation,    to  pre-­‐residency  tax   planning  Gray  is  ready  to  help  you   navigate  this  difIicult  terrain.   U.S.  FCPA  COMPLIANCE   Widespread  globalization  brings     increased  risks  of  corrupt  practices,   and  correspondingly,  an  increase  in   FCPA  enforcement,  penalties  and   prosecutions.       Let  Gray  help  you  prepare  and   implement  appropriate  controls  to   protect  your  organization  from   violations.   International   Accounting &   Compliance  
  6. 6. WHERE WE WORK GEOGRAPHIC AREAS OF EXPERIENCE Greenland   Alaska   Iceland   Canada   USA   Bahamas   Mexico   Belize   Guatemala   El  Salvador   Cuba   Honduras   Nikaragua   Dom.  Rep.   Jamaica   Venezuela   Costa  Rica   Guyana   Panama   Columbia   Suriname   Fr.  Guyana   Ecuador   Brazil   Peru   Norway   Sweden   Russia   Great     Germany   Belarus   Ireland   Britain     Poland   Ukraine   Kazazhstan   France   Mongolia   Romania   Uzbekistan     Kyrgysistan     Italy   North  Korea   Spain   Portugal   Turkey   Tajikistan   Japan   Greece   Syria   Turkmenistan   China   South  Korea   Tunisia   Lebanon   Iraq   Iran   Afghanistan   Morocco   Bhutan   Israel   Nepal   Qatar   Algeria   Libya   Pakistan   Saudi   Westsahara   Taiwan   Egypt   Myanmar   Arabia   U.A.E   India   Laos   Eritrea   Oman   Mauritania   Bangladesh     Mali   Niger   Vietnam    Chad   Senegal   Yemen   Sudan   Cambodia   Burkina   Guinea   Philippines   Nigeria   Thailand   Ethiopia     Sierra  Leone   C.A.R.   Kamerun     Somalia   Malaysia   Liberia   Togo   Uganda   Ghana   Cote  d‘Ivoire   Gabun   D.  R.     Kenya   Congo     Indonesia   Tanzania   R.  Congo   Angola   Bolivia   Paraguay   Finland   Namibia   Zambia   Papua  New  Guinea   Mozambique   Zimbabwe     Botswana   Madagascar   Australia   Swaziland   South  Africa   Chile   Uruguay   Argenena   Lesotho   New  Zealand   International   Accounting &   Compliance  
  7. 7. EB-5 LAWFUL SOURCE OF FUNDS REPORTING     A BRIEF OVERVIEW International   Accounting &   Compliance  
  8. 8. OUR IMMIGRATION PRACTICE AREAS EB-­‐5  LAWFUL  SOURCE  OF  FUNDS   •  Independent  Accountants  report   for  documenting  investment  in   EB-­‐5  Programs   •  Source  of  funds  engagements   conducted  in  accordance  with   AICPA  Standards   •  Procedures  applied  and  evidence   is  gathered  to  support  lawful   source  of  funds  documentation   required  by  U.S.  Citizenship  and   Immigration  Services  (“USCIS”)   •  China  assurance  and  testing  team   •  Experience  in:                    Mexico/  Latin  America                    Asia/China                  Europe                  Middle  East   IMMIGRATION  FIRM  SUPPORT   RENUNCIATIONS   •  “Exit  Tax”  calculations  and   opinions   •  Assistance  with  tax  compliance   prior  to  or  during  petition   •  OVDP  as  required  prior  to   renunciation   •  Forensic  accounting  and  reporting   as  required   •  Audited  or  reviewed  personal   Iinancial  statements   •  Accounting  and  documentation   “back  ofIice”  services   •  Agreed  upon  procedures  reports   and  engagements   •  Tax  compliance     •  Expert  analysis  and  reports   TRANSACTION  SERVICES   •  Business    valuations  related  to   immigrant  investor  business   purchases/investments  in  the  U.S.   •  Transaction  valuations   •  Proferred  wage  qualiIication   expert  opinions   •  Tax  structuring  and  consulting   prior  to  investment   International   Accounting &   Compliance  
  9. 9. EB-5 OVERVIEW §  Established  in  1990  by  U.S.  Congress  to  stimulate  the  ecomony  through  job   creation  and  capital  investment  by  foreign  investors.   §  Investors  must  invest  capital  of  either  $1.0MM  USD  (or  $500k  USD  in  a   “targeted  investment  area”    or  via  a  regional  investment  center)  in  a  new   commercial  enterprise  (established  after  1990  or  a  pre-­‐1990  business  that  is   purchased  and  reorganized  or  expanded  by  40%  in  net  worth  or  number  of   employees).   §  Within  2  years  of  the  investor  being  granted  conditional  permanent  residence,   the  investment  must  create  or  preserve  at  least  10  direct  U.S.  jobs  or  10   indirect  U.S.  jobs  if  investment  is  made  through  a  qualiIied  regional  investment   center.       §  Investor  is  almost  immediately  elgible  for  U.S.  conditional  permanent   residence.   §  For  more  information  please  visit:  www.uscis.gov     International   Accounting &   Compliance  
  10. 10. LAWFUL SOURCE OF FUNDS DEFINED §  USCIS’s  deIinition  of  "capital”  for  EB-­‐5  purposes  excludes  “assets  acquired,   directly  or  indirectly,  by  unlawful  means  (such  as  criminal  activities)”  8  C.F.R.   §204.6  (e).   §  Although  this  deIinition  seems  fairly  simple,  USCIS  has  applied  this  to  place  an   extremely  rigorous  burden  on  the  EB-­‐5  investor  to  prove  that  the  capital  was   “obtained  through  lawful  means.”  8  C.F.R.  §  204.6  (j)(3).    SpeciIically,  8  C.F.R.   §204.6(j)(3)  requires  either  “foreign  business  registration  records”;  corporate,   partnership  and  personal  tax  returns  Iiled  within  5  years;  “evidence   identifying  any  other  source  of  capital”;  or  documentation  of  court  judgments   or  pending  court  cases.   §  USCIS  generally  requests  more  information  than  required  by  regulation  and   insists  upon  far  more  documentation  and  evidence  to  prove  lawful  source  of   funds.   §  Gray’s  lawful  source  of  funds  report,  applying  agreed  upon  procedures,  can   greatly  assist  with  documenting  and  clearly  demonstrating  compliance  with   this  requirement.             International   Accounting &   Compliance  
  11. 11. GRAY LAWFUL SOURCE OF FUNDS REPORT   §  USCIS  documentaeon    requirements  are  very  o  if   extensive  (especially  s CLEAR  DOCUMENTATION     source  documents  are  in  a     foreign  language).   §    If  documentaeon  is  not  clear     or  sufficient  USCIS  will   request  further  informaeon   delaying  peeeon,  or  may   deny  peeeon.   §  Source  documents  are   clearly  referenced  and   included  in  our  report  and   source  of  funds  is  simple  to   follow  and  understand.     ORGANIZED  FOR  USCIS   PROFESSIONAL  REPORT   §  Professional  report  from  U.S.   PCAOB  registered  public   accouneng  firm  lends   credibility  to  the  peeeon  and   reduces  akorney  eme.   §  In  some  jurisdiceons  such  as   China,  documentaeon  of   lawful  source  of  funds  may   be  difficult,  our  engagement   team  has  extensive   experience  in  providing   assurance  and  audit  services   internaeonally.   §  Our  report  is  specifically   organized  with  USCIS   review  in  mind.     §  We  provide  the  evidence  in   a  clear,  legible,  translated   and  understandable   format.   §  Our  report  can  provide  a   basis  for  appeal  if   necessary.     §  Our  report  summarizes  our   findings  and  the  procedures   applied  during  the   engagement     International   Accounting &   Compliance  
  12. 12. LAWFUL SOURCE OF FUNDS REPORTING PROCESS     1.  Client  engages  Gray  to   provide  agreed  upon   procedures  report   documeneng  lawful  source   of  funds.   Step  1   3.  Gray  compiles  evidence.   Once  sufficient  evidence  is   obtained  that  sources   provided  meet  U.S.   requirements  then  proceeds   to  step  4.   Step  2   Step  3   2.  Gray  provides  inieal   documentaeon  list  for   engagement  and  other  “provided   by  client”  informaeon.  Client   provides  informaeon  and  other   documentary  evidence  required.     Step  4   5.  Client’s  akorney  submits   evidence  and  report  to  U.S.   Ciezenship  and  Immigraeon   Services  along  with  I-­‐526   Peeeon.     Step  5   4.  Gray  draos  and  issues   agreed  upon  procedures   report  detailing  EB-­‐5  lawful   source  of  funds   substaneaeon.   International   Accounting &   Compliance  
  13. 13. CONTACT US Gray  welcomes  your  questions,  comments  and  inquiries  and   would  like  the  opportunity  to  serve  you.   Addresses U.S.  International  OfIice   Attn:  Jeremy  Stobie,  CPA,  CFE 10900  NE  8th  Street   Suite  1000     Bellevue,  WA  98004                                 Phone +  001  425.999.3685  xt  10   Website www.grayintl.com   E-mail info@grayintl.com     International   Accounting &   Compliance  

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