Luật Chứng khoán và Luật Doanh nghiệp so với Luật Di trú trong bối cảnh Chương trình EB-5

Although the EB-5 investment and immigration processes are interconnected, they remain legally distinct for purposes of seeking recourse. These processes fall under distinct areas of law, typically handled by different legal professionals. Investments in securities, including EB-5 private equity offerings, are generally regulated by federal and state securities laws, while corporate matters such as shareholder disputes are primarily governed by state law. In contrast, the immigration process is governed by federal immigration statutes enacted by Congress and administered through regulations and policies of the Department of Homeland Security (DHS), primarily its agency U.S. Citizenship and Immigration Services (USCIS). Matters relating to entry visas are additionally governed by the U.S. Department of State.

The impact of litigation on the immigration process varies from case to case. Nevertheless, many investors hesitate to pursue legal action out of concern that doing so may adversely affect their immigration process, allowing issuers’ misconduct to go unchallenged.

Pursuing litigation against an investment issuer may become necessary when corporate malfeasance jeopardizes an investor’s immigration process. A common concern among investors is whether initiating such litigation could itself hinder their immigration case. In these situations, it is crucial to engage separate attorneys experienced in each area of law. Issues such as fraud, misuse of investor funds, insufficient job creation, failure to report material changes affecting the project, or noncompliance with SEC or USCIS filing requirements can all have an adverse impact on the investor’s immigration outcome.

In some cases, issuers delay the repayment of invested capital; in more egregious instances, they may misappropriate investor funds in violation of the subscription documents. Project-related issues generally do not surface during the initial stage of the EB-5 process, when the investor’s temporary green card is issued pursuant to the I-526E petition. At that stage, USCIS adjudicates the project’s compliance with EB-5 requirements based primarily on projections of future performance. However, such issues often emerge approximately two years later, when the investor files the I-829 Petition by Investor to Remove Conditions on Permanent Resident Status. At this point, the investor’s immigration outcome depends entirely on the project’s actual compliance with EB-5 regulations and its ability to substantiate the original projections. If the issuer is unable to provide documentation demonstrating that the investor’s capital was properly deployed and resulted in the creation of the required number of jobs, the investor may be unable to establish eligibility for permanent residency.

Consequently, USCIS may deny the investor’s I-829 petition, potentially resulting in the loss of permanent residency for the investor and their family members if the investor fails to provide sufficient evidence in response to a Request for Evidence (RFE) or Notice of Intent to Deny (NOID). If USCIS ultimately denies the I-829 petition, the investor may face difficult options, such as making a new investment in a qualifying new commercial enterprise (NCE) or restructuring the existing project—often at a significant loss of original capital. Although certain avenues may exist to challenge a USCIS denial, such options are limited and beyond the scope of this discussion. Even after a denial at the I-829 stage, the investor may still pursue litigation against the issuer to compel redemption of equity and recover funds; however, the causes of action and available remedies will depend on the specific circumstances of each case.

Typically, as long as EB-5 investor’s capital was directed to the project in compliance with project documents and filings, remained invested for the mandatory period of time, and led to creation of the requisite number of jobs, investor’s I-829 petition for removal of conditions and issuance of permanent green card will be approved.

It is critical for investors to act promptly when there are reasonable grounds to suspect fraud or project irregularities. In many cases, investors fail to monitor the status of their projects and only discover the project’s collapse – and the resulting loss of both their investment and immigration benefits – when it is too late to intervene. At that point, they may face an expensive and uphill battle against judgment-proof entities and individuals who were supposed to safeguard and manage their capital. Timely action is essential, as civil claims may become time-barred if not filed within the applicable statute of limitations, and key evidence may be lost. Investors who delay asserting their rights often find themselves without meaningful legal recourse.

If you suspect that your project is not proceeding as planned or you feel being misled or underinformed by your issuer, please contact AIIA for support.