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The program is placed in a really odd and non-helpful administrative area for the stimulation of global financial investment in the United States. We are giving away as well much for also tiny of a financial investment.

The local facilities, with their half-million plans, basically undercut the more sensible million-dollar part of the EB-5 program. Third, such programs, if we have them in all, as they perform in Australia, ought to have to do with creating company entities, not passive investments. It needs to be regarding creating actual work, not clarify calculations concerning the indirect production of tasks, which is now component of the regulations.


Possibly that is just one of the factors why it has failed every year to reach the legal goal of 10,000 financial investment visas. Fifth, the Regional Center Program is inherently awkward, and the program is too loaded with middlemen, both public and private. The program has even more than its share of scandals, which I will get right into later if anyone is interested.


This is an agency that loves to state yes to candidates, but as the table in my testimony reveals, USCIS officers have far more problem with EB-5 applications than others. I think that is something that no one has actually truly discussed a lot. EB5 Regional Center Program. There are high rates of internal denials in this program and forever factor

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Seventh, in this program visas go to people who could not get them differently and to people whose planned investment is in fact much less, according to the Federal Get, than the average mean total assets of all American family members in 2007. Let me broaden on one of my monitorings.


My estimate based on the investors' eco-friendly card applications submitted 2 years after the very first financial investment-- these are the strong ones that remain and are accepted. This is 2009-- was that they had concerning $191 million verified-- that is my quote. USCIS does not give the type of data that we might make use of on this.


So for every single $100 of raised foreign financial investment that year, the EB program contributed one penny. Under a much extra wobbly statistical base, the first applications of would-be immigrant capitalists, USCIS is telling journalists that the level of investment in the just-concluded year was concerning $1.2 billion. Let us accept that.

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Thank you for listening to me. I eagerly anticipate your remarks and questions. [The prepared Website declaration of David North appears as a submission for the record.] Chairman Leahy. Thank you. Our following witness is Robert Divine. He is an investor of Baker, Donelson, Bearman, Caldwell, and Berkowitz. He is the head of the firm's immigration method group.

Divine served as Chief Advise of the USA Citizenship and Immigration Services from July 2004 up until November 2006, the year in which he was Performing Director, and after that Performing Deputy Director. He has functioned extensively with the EB-5 program in personal technique. He was chosen, as I comprehend, vice head of state of the Organization to Spend in U.S.A., the nationwide market association of regional.


Divine, we are happy to have you right here. Please go on, sir. STATEMENT OF ROBERT C. DIVINE, ATTORNEY, BAKER, DONELSON, BEARMAN, CALDWELL, AND BERKOWITZ, P.C., CHATTANOOGA, TENNESSEE, AND VICE HEAD OF STATE, PURCHASE THE United States (IIUSA) Mr. Divine. Thanks, Mr. Chairman, Senator Grassley, and others. Thanks for having me.


At the majority of, if all 10,000 ports were used, it would be 1 percent of the immigration yearly to the United States. It is not near that yet, but it is growing and obtaining towards that. Especially as USCIS, the company that oversees the program, has actually been making the rules more clear and the processes much more logical and clear for the individuals who are arranging financial investments and for the investors that are spending, even more individuals have wanted and able to put effort and money right into the process to locate great projects and develop them, and afterwards extra investors have agreed to invest their money and take the risk and use the cash to produce the work that a fantastic read is the factor of the program.

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These tasks do not wait around forever, and USCIS comprehends that and are trying to speed up the program, speed the process - EB5 Regional Center Program. That does not suggest that they are relaxing their scrutiny, and, as a matter of fact, they prepare to deny applications that are not certifying. And they do so, as was discussed

The local center part of the program is not. It becomes part of an appropriations expense that was established in 1992, and ever since that program has actually been extended 5 times for 19 years. It is time for it to be long-term, and it requires to be done now and not nearer to the day of expiry in September.


The process takes an excellent while to function up a project and after that to obtain the investors approved. And they do not want their money flowing through till they have been accepted. And the specter of the expiry of this Regional Facility Program in September is already preventing the advancement of projects.

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I would like to make clear that the Regional Facility Program is not the exact same as the half-million-dollar point. The concept of half a million or a million is a function of the routine EB-5 legislation that belongs to the code. It simply is a truth that a lot of the regional centers that are merging investments have set those instead of high joblessness or in backwoods helpful resources where fifty percent- million-dollar financial investments are permitted, which makes good sense.