More EB-5 AAO Decisions Posted Today 6-9-2014

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More EB-5 AAO Decisions Posted Today 6-9-2014

  1. 1. Contact: joseph.whalen774@gmail.com OR (716) 604-4233 OR (716) 768-6506 Page 1 More EB5 AAO Decisions Posted Today By Joseph P. Whalen (June 9, 2014) Bright and early this morning I checked for any new EB-5 AAO Decisions and found some! Hereare some links and notes: LINK TO AAO DECISION & COMMENTARY OUTCOME, EXCERPTS, COMMENTS MAY272014_01B7203.pdf This I-526 for investing in the establishment of an assisted living facility was obviously filed prematurely. Numerous fundamental errors were found. These errors were mostly things that could not be corrected after filing the I- 526. This investment was not associated with a Regional Center so the I-526 could not be filed as an I-924 containing an I-526 Exemplar Petition. There simply was no “wiggle room” to make any material or substantive corrections. Once all of the issues have been addressed, the investor will have to re-file a new I- 526. The AAO’s Appeal Dismissal addressed ALL issues known to date. As long as no new issues crop up, a corrected filing should get approved. AAO identified additional issues beyond the director and in so doing did the customer a “favor” or a “positive” service. APPEAL DISMISSED: Investment not “at risk”—redemption agreement, no actual business activity has taken placed, non-EB-5 funds were not secured, no assurance that any business would be conducted, and the investor’s funds were not sourced. “The petitioner has not shown that he has placed the required amount of capital at risk for the purpose of generating a return on the capital. While not determinative, page 31 of the Confidential Private Offering Memorandum explicitly states that "[a]n investment in the partnership is purely for immigration benefits and not for commercial return on investment." For the reasons discussed below, the documents in the record do not establish that the petitioner has placed the claimed capital investment at risk to generate a return.” At p. 4 Attempts to make material changes to plans, documents, and the money in response to the director’s RFE and AAO’s Notice of Derogatory Information were NOT acceptable due to the timing. As this was an actual visa petition, the “eligibility at time of filing” rule was in full force. The filing date of an approved preference visa petition transforms into a “priority date” for visa allocation purposes!
  2. 2. Contact: joseph.whalen774@gmail.com OR (716) 604-4233 OR (716) 768-6506 Page 2 LINK TO AAO DECISION & COMMENTARY OUTCOME, EXCERPTS, COMMENTS MAY272014_02B7203.pdf Another Texas assisted living facility project. It is unclear if this is the exact same project as in the above case or not. The “developer” that the investors are working with seems to be attempting to use $1 to 1.5 million in EB-5 money plus another $2 to 2.5 million of non-EB-5 funding at each of 13 facilities in Texas. Total cost if only $3.5 million per facility. APPEAL DISMISSED: “The chief determined that the petitioner did not demonstrate that he had invested or was actively in the process of making an at-risk investment of the required $500,000. For the reasons discussed below, the petitioner has not overcome the chief's sole ground for denial. In addition, the petitioner has not documented the lawful source of his required amount of capital. Accordingly, the petitioner's appeal will be dismissed.” At p. 2 MAY272014_03B7203.pd “According to the business plan, the NCE "is primarily engaged in wholesaling and exporting sea cucumber[ s] to Asia." The petitioner indicated in part 2 of the petition that the NCE is located in a targeted employment area. Thus, the required amount of equity investment is $500,000.” At p. 2 Overcapitalizing an existing successful business with no plan to expand is insufficient for EB-5 purposes. APPEAL DISMISSED: “The chief determined that the petitioner did not demonstrate that he had invested or was actively in the process of making an at-risk investment of the required $500,000. For the reasons discussed below, the petitioner has not overcome the chief's sole ground for denial. In addition, the petitioner has not documented the lawful source of his required amount of capital. Accordingly, the petitioner's appeal will be dismissed.” At p. 2 That’s my two-cents, for now!

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