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The program is placed in a really strange and non-helpful governmental area for the stimulation of international financial investment in the United States. We are providing away also much for as well tiny of a financial investment.


The local facilities, with their half-million systems, essentially damaged the extra sensible million-dollar component of the EB-5 program. Third, such programs, if we have them in any way, as they perform in Australia, need to have to do with producing service entities, not passive financial investments. It ought to be about creating actual jobs, not specify calculations about the indirect production of jobs, which is now component of the regulations.


Possibly that is just one of the reasons it has stopped working every year to get to the legal goal of 10,000 investment visas. Fifth, the Regional Center Program is naturally clumsy, and the program is too loaded with intermediaries, both public and personal. The program has more than its share of scandals, which I will obtain into later on if anybody is interested.


This is a firm that enjoys to claim yes to candidates, yet as the table in my statement reveals, USCIS officers have far more trouble with EB-5 applications than others. I assume that is something that no one has actually talked about a lot. EB5 Regional Center Program. There are high prices of internal denials in this program and forever reason

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Seventh, in this program visas go to individuals that can not get them otherwise and to individuals whose scheduled financial investment is in fact much less, according to the Federal Book, than the average mean total assets of all American families in 2007. Allow me expand on among my monitorings.


My price quote based upon the financiers' permit applications submitted 2 years after the first investment-- these are the solid ones that stay and are authorized. This is 2009-- was that they had about $191 million validated-- that is my price quote. USCIS does not offer the sort of information that we can make use of on this.


So for every single $100 of increased foreign financial investment that year, the EB program contributed one cent. Under a much extra unsteady statistical base, the preliminary applications of potential immigrant financiers, USCIS is telling journalists that the level of investment in the just-concluded year was about $1.2 billion. Let us accept that.

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Thanks for paying attention to me. I expect your comments and questions. [The prepared statement of David North looks like an entry for the document.] Chairman Leahy. website Thanks. Our next witness is Robert Divine. He is an investor of Baker, Donelson, Bearman, Caldwell, and Berkowitz. He is the head of the firm's immigration practice group.




Divine acted as Principal Advise of the United States Citizenship and Migration Services from July 2004 till November 2006, the year in which he was Performing Director, and after that Performing Deputy Director. He has worked extensively with the EB-5 program secretive practice. He was chosen, as I recognize, vice president of the Association to Invest in United States, the national industry organization of local.


Divine, we are thrilled 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 PRESIDENT, INVEST IN THE USA (IIUSA) Mr. Divine. Thank you, Mr. Chairman, Senator Grassley, and others. Thank you for having me.


At most, if all 10,000 slots were used, it would be 1 percent of the immigration every year to the USA. It is not near that yet, but it is expanding and obtaining toward that. Especially as USCIS, the agency that oversees the program, has actually been making the rules clearer and the processes much more rational and clear for individuals that are arranging financial investments and for the capitalists who are spending, even more individuals have agreed and able to put initiative and cash into the procedure to discover excellent projects and create them, and then more capitalists have wanted to spend their money and take the threat and use the cash to produce the jobs that is the point of the program.

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These projects do not linger permanently, and USCIS comprehends that and are trying to speed the program, speed the procedure - EB5 Regional Center Program. That does not mean that they are relaxing their analysis, and, actually, they prepare 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 component of an appropriations bill that was enacted in 1992, and because then that program has actually been prolonged 5 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 expiration in September.


The process takes a great while to work up a project and afterwards to get the investors accepted. And they do not desire their cash flowing through till they have been approved. And the specter of the expiry of this Regional Facility Program in September is already preventing the development of projects.

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I want to make clear that the Regional Center Program is not the like the half-million-dollar point. The concept of half a million or a million is a function of the regular EB-5 legislation that belongs to the code. It simply is a reality that most of the local facilities that are pooling investments have actually established those in areas of high joblessness or in country locations where half- million-dollar financial investments are enabled, which makes good sense.