April 16, 2012
Times op-ed: EB-5 program lacks credibility, needs reform, but "solutions are straightforward" (really?)
Atlantic Yards Report
A New York Times op-ed today, Making Visas-for-Dollars Work, suggests that the EB-5 program can and must be fixed. Writes author Ann Lee a senior fellow at the center-left think tank Demos and the author of “What the U.S. Can Learn From China”:
Given how many high-worth investors are clamoring to enter the United States, the program could have a significant effect on American unemployment. Indeed, it has brought in some $1 billion over the last fiscal year, and the President’s Council on Jobs and Competitiveness has called for the program to be “radically” expanded over the next few years.
Unfortunately, the program is so rife with fraud and corruption that it could actually have the opposite impact and deter investment. To regain its credibility, the program must make a number of changes to enable more transparency and demand more competence from its operators.
The most egregious problems with the EB-5 program can be found in its 218 regional centers, which work with private-sector brokers to identify local investments and direct foreign participants to them. Examples abound of centers and brokers playing down risky investments and misrepresenting how the program works, including a promise that EB-5 investments are guaranteed by the federal government — when the government in fact does nothing of the sort. Many investments have failed to create the required 10 jobs and even gone bankrupt, leaving the investor without his money or his green card.
That's not the half of it. It goes far, far deeper, such as misrepresenting the project itself. And the regional centers do not merely "work with private-sector brokers," that's what they are: private businesses.
Posted by eric at April 16, 2012 12:09 PM