A visa program that lets foreigners invest their way into permanent residency is getting a new lease on life, thanks to the recession and tight credit.
More recently, the U.S. Secret Service has been investigating Derick Coles, a British man who promised foreigners help in obtaining EB-2 and EB-5 visas if they invested in his Sarasota-based businesses, but he allegedly stole their money instead. According to the British press, his victims collectively lost more than $3 million. Coles’ whereabouts are unknown.
The biggest impediment to the EB-5 program these days may be bureaucracy and continuing red tape. A 2005 Government Accountability Office study of the program attributed the low rate of participation to numerous factors, including an onerous application process, lengthy adjudication periods and changing interpretations of the regulations regarding financial qualifications for the program.
To build confidence in the program among foreign investors, Behar and Parnell say the government needs to enact a five-year or permanent extension of the regional center program, a pilot program that was started in 1993 but is set to expire on Sept. 30. “While we’re very grateful it’s been extended, it does not give an enormous amount of confidence to a wealthy individual looking to pull the trigger,” says Parnell.
He explains it can take about six months alone to properly evaluate a potential EB-5 investment opportunity. Once a foreign investor actually decides to take the plunge, background checks performed by the Department of Homeland Security can range anywhere from 26 days to 17 months.
Parnell says he would also like to see the government allow “premium processing” of EB-5 applications, letting clients pay a premium to move their applications through faster.
Behar believes the program deserves a future. The economic downturn, he says, has made many in the U.S. finally see the EB-5 program for what it is —?a valuable economic development tool. The U.S. economy benefits from the job creation, the foreign investor may get a good return on his investment and a path to citizenship, and the U.S. sponsor has a way to raise all-cash financing for a project, he says. “It’s a triple-win situation.”
Walter M. “Marty” Cummins Jr. hopes to develop a chain of restaurant bookstores along the High Tech Corridor with money from foreign investors. [Photo:Jeffrey Camp]