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Initially, the program is positioned in a very strange and non-helpful administrative area for the stimulation of global investment in the United States. Second, its scale is all incorrect. We are offering away way too much for too small of an investment. Further, increasing equity capital fifty percent a million bucks a tranche is, to claim the least, ineffective.


The local facilities, with their half-million schemes, essentially undercut the a lot more sensible million-dollar part of the EB-5 program. Third, such programs, if we have them whatsoever, as they carry out in Australia, should be concerning developing company entities, not easy financial investments. It must have to do with creating real tasks, not clarify estimations about the indirect development of tasks, which is currently part of the regulations.


Maybe that is among the reasons that it has actually fallen short time after time to get to the legal objective of 10,000 investment visas. Fifth, the Regional Center Program is naturally clumsy, and the program is too full of middlemen, both public and personal. The program has more than its share of scandals, which I will get involved in later on if anybody is interested.


This is an agency that enjoys to claim yes to candidates, however as the table in my statement shows, USCIS officers have a lot more problem with EB-5 applications than others. I believe that is something that nobody has actually spoken about much. EB5 Regional Center Program. There are high prices of interior denials in this program and forever factor

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Seventh, in this program visas most likely to people that could not obtain them any various other way and to individuals whose planned financial investment is really much less, according to the Federal Book, than the ordinary mean net well worth of all American family members in 2007. Let me increase on one of my monitorings.


My estimate based upon the investors' environment-friendly card applications filed 2 years after the very first financial investment-- these are the solid ones that continue to be and are authorized. This is 2009-- was that they had about $191 million validated-- that is my price quote. USCIS does not supply the type of information that we can use on this.


So for each $100 of raised foreign investment that year, the EB program added one dime. Under a much more unsteady analytical base, the first applications of would-be immigrant investors, USCIS is telling journalists that the level of investment in the just-concluded year was concerning $1.2 billion. Allow us approve that.

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Thank you for paying attention to me. I eagerly anticipate your remarks and questions. [The ready statement of David North shows up as a submission for the record.] Chairman Leahy. Thanks. Our next witness is Robert Divine. He is a shareholder of Baker, Donelson, Bearman, Caldwell, and Berkowitz. He is the head of the company's migration technique group.




Divine offered as Chief Guidance of the USA Citizenship and Immigration Providers from July 2004 until November 2006, the year in which he was Performing Director, and after that Acting Replacement Director. He has functioned extensively with the EB-5 program secretive method. He was elected, as I recognize, vice president of the Association to Spend in USA, the nationwide industry association of local.


Divine, we are delighted 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, INVEST IN THE U.S.A. (IIUSA) Mr. Divine. Thank you, Mr. Chairman, Senator Grassley, and others. Thanks for having me.


At many, if all 10,000 slots were used, it would certainly be 1 percent of the migration annually to the United States. It is not near that yet, however it is expanding and obtaining towards that. Specifically as USCIS, the agency that supervises the program, has been making the policies more clear and the procedures more logical and clear for the individuals that are arranging financial investments and for the capitalists that are investing, more individuals have actually wanted and able to put effort and money into the process to discover great jobs and establish them, and afterwards a lot more financiers have actually been ready to spend their cash and take the danger and make use of the money to create the jobs that is the point of the program.

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These jobs do not linger for life, and USCIS recognizes that and are trying to speed up the program, speed the procedure - EB5 Regional Center Program. That does not indicate that they are relaxing their analysis, and, as a matter of fact, they are ready to reject applications that are not qualifying. And they do so, as was stated


The local center part of the program is not. It is part of an appropriations bill that was enacted in 1992, and since then that program has been prolonged five times for 19 years. It is time for it to be irreversible, and it requires to be done now and not nearer to the day of expiry in September.


The process takes a good while to develop a task and after that to get the capitalists accepted. And they do not want their money moving through till they have actually been approved. And the specter of the expiry of this Regional Center Program in September is currently discouraging the development of jobs.

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I wish to make clear that the Regional Center Program is not the like the half-million-dollar point. The idea of half a million or a million is a function of the normal EB-5 law that is part here of the code. It simply is a truth that many of the regional centers that are merging financial investments have set those instead of high joblessness or in backwoods where half- million-dollar financial investments are enabled, which makes feeling.