(By Rahul Reddy & Rebecca Chen, Attorneys at Law)

 EB-5 fraud has cost investors millions of dollars in 2015 alone. In July of 2015, the Securities and Exchange Commission (SEC) filed charges against a California oil and gas company for intentionally defrauding EB-5 investors in a $68 million Ponzi scheme. The SEC’s complaint alleges that Bingqing Yang, owner of Luca International Group, LLC and its affiliated companies, represented to investors that their money would be invested in oil and gas drilling operations,  but actually used the investors’ money for sham profit payments to earlier investors, along with his own personal use. Even though Luca International’s drilling operations were losing millions of dollars, Yang and her co-conspirators spent massive amounts of investor money on vacations, golf outings, a $2.5 million home in a gated community, and even $200,000 in speaking fees to have Former President George W. Bush speak at golf outing for new potential investors hosted in Pebble Beach, California.

In addition to losing investors millions of dollars, fraud can jeopardize EB-5 investors’ legal status in the United States. This is because the EB-5 program initially awards the investor a conditional green card good for two years before providing him with a permanent green card. If the investor does not provide the investment required for EB-5 status, he could ultimately lose his permanent residence status. (Please refer to our article titled EB-5 Investors: Explained for more details on the EB-5 visa) 

How to become an EB-5 Immigrant Investor, the Right Way

If you are looking to become an EB-5 immigrant investor, you should ensure your investment is fully compliant with USCIS regulations to avoid falling prey to EB-5 investment fraud. Be sure that any EB-5 investment you make with another party is done through a properly registered broker-dealer to minimize the chance you will be a victim of fraud. Additionally, be wary of any signals that fraud may be present, such as promises that the investment will lead to the receipt of a green card, guaranteed investment returns, or extremely consistent investment returns regardless of market conditions. 

However, the safest possible option for becoming an EB-5 investor is to not trust another individual or group with your investment, and instead invest your capital into your own business enterprise. By doing so, you will retain financial and managerial control over your investment, ensure that you will not be victimized by an EB-5 investment scam, and have the best likelihood of retaining your green card after the initial 2-year provisionary period.

Regardless, it is important to keep in mind that an EB-5 petition will not automatically result in a permanent green card. In 2012, approximately 80% of investors who applied for conditional two-year green cards received approvals. While this statistic is promising, the real struggle occurs after this initial step. Less than 50% of EB-5 investors with temporary green card approvals ultimately apply for permanent green cards, and of those about 80% obtain permanent green cards. This surprising figure is essentially due to one underlying issue: the failure of the applicants’ investments.  In order to gain permanent residence status, an investor must sustain an investment in a business for the full two years and provide full time jobs for 10 qualifying or existing employees, which many investors are unable to accomplish.

  

Reddy & Neumann, P.C. is an immigration law firm in Houston, Texas. For over 15 years, our firm has successfully represented corporate clients across the United States in their efforts to bring foreign workers and business professionals to the United States. Reddy & Neumann, P.C. is highly experienced in working with employment-based visas, adjustment of status, green cards, and PERM labor certification. From filing, through approval, and on to appeal, we do everything possible to ensure that your company can bring the best and brightest in the world to the United States.

 

(By Rahul Reddy & Rebecca Chen, Attorneys at Law)

While the EB-5 immigrant investor visa has many advantages for those who are able to meet the requirements, it is not without its risks. This article discusses the substance of the EB-5 immigrant investor visa, along with tips to become an EB-5 investor in the safest possible manner.

What are the Qualifications for an EB-5 Visa? 

The “immigrant investor visa”, also known as the EB-5 visa, is an investment-based opportunity to obtain U.S. permanent resident status (a “green card”). Generally, one may obtain a green card through the EB-5 category by meeting two requirements: (1) invest $1,000,000 of legally obtained capital in a U.S. commercial enterprise and (2) create 10 jobs for U.S. workers.

The $1,000,000 investment requirement may be lowered in some limited circumstances. For example, the requirement may be bypassed by investing within a “Targeted Employment Area”, which includes areas that have been defined as “rural” or with “high unemployment”. In that case, the investment requirement is lowered to $500,000.

The second requirement may be lessened in certain circumstances as well. For example, if the investor invests in a “troubled” business, jobs that are “saved” are counted towards the 10 job requirement, in addition to “jobs created”.

Who May Benefit?

The investor, along with his or her spouse and unmarried children may all obtain green cards through this category

What are the Advantages?

Does not require PERM Labor Certification: There is no requirement to demonstrate that there is a shortage of U.S. workers available to perform your job. EB-5 allows PERM labor certification to be avoided altogether. 

Does not require a permanent job offer in the U.S.: This is unlike the EB-1C Multinational Executives or Managers Category, which requires a permanent job offer in the U.S.

Does not require extraordinary ability: The EB-5 visa category does not require a demonstration of any  special skills or abilities. 

What are the Disadvantages?

Investment risk: EB-5 investors are often the targets of Ponzi Schemes, and fraud has cost investors millions of dollars in 2015 alone. However, fraud can have even more drastic effects on EB-5 investors than loss of earnings (since many EB-5 investors choose to forego other investments with a higher rate of return due to the immigration benefits the EB-5 program provides). Because the EB-5 program does not initially award the entrepreneur full permanent residency, but rather a conditional green card good for two years, EB-5 fraud can have drastic effects on immigration benefits long after the initial investment was made, such as loss of permanent residency status.

Expensive: Most of the time, one must invest at least $500,000 or $1,000,000 just to meet the EB-5 investment requirement. This is in addition to the additional work and expenses required (such as administrative and legal fees) beyond the actual investment.

Removes non-immigrant status: The EB-5 category gives the investor a two year temporary green card, which causes the investor to lose any previous non-immigrant status (H-1, L-1, etc.), unlike most other paths to permanent residence. For this reason, it is extremely important that the case is ultimately successful.



Reddy & Neumann, P.C. is an immigration law firm in Houston, Texas. For over 15 years, our firm has successfully represented corporate clients across the United States in their efforts to bring foreign workers and business professionals to the United States. Reddy & Neumann, P.C. is highly experienced in working with employment-based visas, adjustment of status, green cards, and PERM labor certification. From filing, through approval, and on to appeal, we do everything possible to ensure that your company can bring the best and brightest in the world to the United States.

 

 

 

(By Rahul Reddy & Rebecca Chen, Attorneys at Law)

Most H1-B visa holders are aware of the six-year limit that applies to H1-B visas, which may be renewed by staying outside the U.S. for at least 1 year and re-applying under the cap for a new H1-B visa. However, H1-B visa holders who have spent time outside the United States also have the option of “recapturing” their time spent outside the country. This option allows their H1-B visa to be extended by one day for every full day spent outside the U.S., up to the six-year limit. 

Alternatively, many people are eligible for more than one type of visa, and may switch between visa types during their stay in the U.S. One question these visa holders may have is how switching between visa types (for example, from H1-B to TN and back to H1-B) affects their visa eligibility duration. The answer to this question is that time spent inside the United States on any visa other than an H1-B does not count towards the H1-B six year maximum, and may be recaptured accordingly. According to Chapter 31.3(g)(9)(A) of the USCIS Adjudicator’s Field Manual, “only time spent in the United States as an H1-B counts towards the maximum.” (Emphasis added) Under this guidance, as well as that contained within the December 5, 2006 USCIS Guidance Memo by Associate Director Michael Aytes, a change of status from H1-B to another visa type interrupts the visa holder’s H1-B period of admission. Therefore, recapture of the time spent outside of H1-B status up to the six-year maximum is permitted. Beyond that, an approved I-140 would be required to extend H1-B status beyond the maximum in one-year increments as allowed by the American Competitiveness in the Twenty-First Century Act (“AC21”). However, because some visa classifications (such as TN) require proof of non-immigrant intent, be sure to speak to a qualified immigration attorney before pursuing a change in visa type. 

 

Reddy & Neumann, P.C. is an immigration law firm in Houston, Texas. For over 15 years, our firm has successfully represented corporate clients across the United States in their efforts to bring foreign workers and business professionals to the United States. Our experienced team of immigration lawyers in Houston & Dallas advises clients throughout the H-1B visa application process, including responding to various requests for evidence and consular processing issues. From filing, through approval, and on to appeal, we do everything possible to ensure that your company can bring the best and brightest in the world to the United States.

 

 

(By Rahul Reddy & Rebecca Chen, Attorneys at Law)


Foreign students who maintain valid F-1 non-immigrant status may be able to work in the United States by participating in Curricular Practical Training (CPT). Participation in CPT is available only before a foreign student completes the degree program, and the CPT employment must be an important part of the school’s existing curriculum. The student must also meet additional requirements to qualify for CPT, which includes obtaining authorization from the school’s Designated School Official (DSO). Typically, students are only eligible for CPT if they have been studying full-time for at least one year. However, some schools enable students to participate in CPT during the first year of student. Those who participate in CPT within the first academic year often face obstacles when they later attempt to transfer to H-1B status. 

Foreign students who have engaged in CPT are often faced with Requests for Evidence (RFEs) from the USCIS upon seeking a transfer to H-1B status. These RFEs are most frequently issued when the applicant has attended a small, accredited institution and engaged in CPT within the first academic year at the institution. Additionally, RFEs are often issued when the USCIS is trying to determine whether the applicant is in violation of his status, especially when the CPT employer’s address is far from the applicant’s school address.

The RFEs typically request additional documentation to establish that the applicant maintained valid F-1 non immigrant status by engaging in full course of study, whether the applicant physically attended classes, and whether the applicant actually worked during CPT. 

 The RFEs are typically asking for the following information:

Evidence that the applicant attended classes and maintained valid F-1 non-immigrant status: Such evidence may include school transcripts, proof of tuition payments, receipts for books and school supplies, parking passes, copies of student ID, class schedules, and course syllabi. If the applicant attended live courses with any online courses, but the CPT employer’s address is far from the school, it is the burden of the applicant to establish that he attended the live courses.

If the student did not continually reside within normal commuting distance from school, he may submit evidence of travel from his residence to school, including plane ticket receipts, train or bus passes and interstate gas receipts. Online courses can be considered as a violation of your student visa. Only one online course per semester is permitted by law.

Evidence that immediate participation in CPT was required within the first academic year: Such evidence can include a letter from the Designated School Official (DSO) of the institution, evidence from the institution’s student handbook or course catalog describing the graduate degree program, and any evidence from the institution establishing that immediate participation in CPT was required as an integral part of your degree program.

Evidence that CPT directly relates to the applicant’s major area of study: Such evidence may include an offer letter from the CPT employer, a letter from the DSO of the institution, evidence from the institution’s course catalog, the applicant’s course syllabi of his courses, and CPT cooperative agreement between the CPT employer and institution. It is important that a formal authorization between the school and CPT employer be made through a cooperative agreement.

Things to keep in mind:

On January 29, 2015, the Student and Exchange Visitor Program (SEVP) released Broadcast Message 1501-03 encouraging DSOs to remind F-1 students of the regulations related to employment while studying in the United States. In the message, the SEVP reiterated the importance of obtaining DSO authorization on the Form I-20 before starting CPT, and of obtaining a formal cooperative agreement between the CPT employer and the institution verifying that CPT is an integral part of the student’s program of study.

Our office has received multiple RFEs regarding CPT employment this year. As of August 2015, 75% of the responses to the RFEs have resulted in approvals, while 25% have resulted in denials. We have noticed that the USCIS does a thorough review of the evidence to determine whether the applicant violated his status, and that those denied are usually due to lack of documentation. 

As the statistics above show, it is not impossible to get an I-129 approval when issued an RFE regarding CPT. However, keep in mind that providing sufficient documentation that the applicant maintained his F-1 status while taking a full course of study, appropriately attended his classes, and actually engaged in CPT is vital to drafting an RFE response that will result in an approval.

We strongly recommend that you contact a competent attorney before responding to the RFE.

 

Reddy & Neumann, P.C. is an immigration law firm in Houston, Texas. For over 15 years, our firm has successfully represented corporate clients across the United States in their efforts to bring foreign workers and business professionals to the United States. Our experienced team of immigration lawyers in Houston & Dallas advises clients throughout the H-1B visa application process, including responding to various requests for evidence and consular processing issues. From filing, through approval, and on to appeal, we do everything possible to ensure that your company can bring the best and brightest in the world to the United States.