EB-5 Planning Steps for Indian Families (2 of 2)

Hello EB-5 investors. This is Floyd Mitchell with the EB-5 Investor Portal; the leading resource for information regarding the EB-5 visa. I publish articles based upon my interviews with leading US immigration attorneys and other EB-5 professionals which are produced as podcasts to educate EB-5 investors. Our podcasts are syndicated around the world on search engines, social media, YouTube, Google Podcasts and our own Apple News Channel – “EB5 Investor Portal”.

So, this is not a forum, or a blog post based upon personal opinions or experiences. It is information taken from my many, many hours of interviews with licensed immigration and securities attorneys, securities professionals and others.

Today’s episode is titled EB-5 planning steps for Indian families. Our special guest is Poorvi Chothani. Poorvi is the managing partner of LawQuest, Mumbai and the law office of Poorvi Chothani PLLC Florida is a prominent immigration attorney with a successful immigration practice in Mumbai, India. LawQuest is a global immigration firm that offers citizenship and residence by investment options to its clients. Over the past two years, Poorvi has assisted several Indians with EB-5 advice and I-526 petitions. Poorvi is an active member of AILA, founder and past chair of The Global Migration Section, the ABA, Immigration Committee vice-chair and diversity as well as the International Bar Association where she is an office bearer in the Immigration Committee. Poorvi is also going to take over as the president of the Indo-American Chamber of Commerce.

This article is one in a series from Poorvi.

I asked how long does it take from beginning to end to file the I-526 petition?

It really depends on the individual and how well they have documented their earnings and investments. People say, “Oh, ours is very easy. Our paperwork is all in place and it’s not going to take you very long because it was only investments and security which I inherited, blah, blah, blah.” My goodness, but by the time you trace every transaction and every statement and every share valuation report, it can take a while. The quickest we’ve been able to turn it around is ten working days after we receive everything from the investor. We could do it faster, but we would rather take the little bit of extra time and be thorough than rush through the process.

If you’re talking about the entire process, let’s say that they decided that they want to invest today, they look for … We’ll talk about regional centers because that’s the most popular and more quicker process that we’ve seen. If they’ve decided which regional center they want to invest in and they have done the paperwork with that regional center in parallelly, they’ve begun documenting their source and path of funds and they give it to us, we hit the ground running and keep it all ready and file it, like I said, within ten working days generally.
Once it is filed you get a receipt within one to three weeks, sometimes four weeks, from the USCIS and after that it takes about 14 to 20 months to get approved. Then once it’s approved the case will then have to be sent to the Department of State and then they will schedule an appointment at the consulate in India where they have to go for a visa interview. From approval to visa interview date we are seeing anywhere from two to four months. It’s at that time that they really get the green card and then they can arrive in the United States. In an ideal situation, within about 24 months they could be here.

How long from the point of, let’s say engaging you as their immigration attorney and beginning the I-526 petition. How long typically is it before they get their conditional green card so that they can travel here?

They’re looking at two years to get their green card and then two years to remove their green card, so they can travel to the United States once they’ve been issued their initial green card, which I said is about two years from the date they start choosing their regional center and their attorney. The removal of conditions application can be filed just before two years from the date on which they got their green card.

You’ve also got to calibrate that with the investment because some of these investments lie in an escrow account until they are really invested into the business. But just now because of the long wait times we are seeing that investment amounts are deployed to projects right away rather than waiting because no project is going to wait for two years to get financed so regional centers are forced to deploy right away but the immigration benefit kicks in at a later date because of the processing wait times.

I asked, can a family travel to the US while the application is pending and what are those conditions?

Technically speaking there is … When you want to travel on a tourist visa or a business visa you’ve got to have non-immigrant intent. Having filed an EB-5 petition, which is really a green card application by investment and creating employment, you have established that you have immigrant intent. If you apply for a new tourist or business visa, you’ve got a higher threshold to meet to convince the officer that you have no immigrant intent until your green card is approved, so you’ve got to prove that, which could be a bit of a challenge.

Not only that, suppose you already have a business visa or a tourist visa from the past, I mean you got it five years ago and they’re valid for ten years and you decided to travel to the United States. You’re absolutely allowed to do that, but when you come to the port of entry or the airport where you land, you’ve got to again establish to the officer that you are intending to visit the United States for a short period, it’s a temporary visit, and you have no intention to reside there until your immigrant visa is approved or until your EB-5 visa is approved.

To briefly answer your question, yes you can travel while the EB-5 is pending, but you’ve got to tread carefully. If your clients ask you, “How soon do I get my permanent green card?” What is your response there? I would say seven to … A permanent green card I would say four years and then citizenship I say generally seven to eight years, based on current processing time. But again, these are all estimates. For the program to work the investor has to make an investment in a project that’s … Basically it’s what is referred to as an at-risk investment. That involves, as you mentioned, we’re discussing the regional center EB-5 program, not the direct investment, that’s a topic for another call.

I wanted to know how she advises clients to choose a good regional center project? What does an EB-5 investor look for in a good regional center project?

By law, and ethically I am not allowed to advise clients on which regional center to choose or to make their investment in, so we don’t advise on that at all. There are other bodies in India and regional centers have representatives in India and they send their senior members from the United States frequently to India to advise potential investors and to “recruit” investors out of India. We do not get involved in the choosing process, that is completely independent of our legal services.

However, when clients come to us they say, “But we want a guarantee. We want to invest in a regional center that guarantees a return or we want to put it in a regional center that has got guaranteed returns on it.” Both these are not allowed because that removes the element of risk, so when clients ask that I tell them that to qualify for EB-5 your money will have to be at risk and any terminology that you may negotiate with the regional center, which is very unlikely, giving you any guarantees or assured returns is going to actually harm your case rather than help your case.

Clients in India are very, very conscious of return on investment so this dialog, this conversation about security of capital and return on the investment happens very frequently at several stages. The way I have handled it in the past is that we tell clients, “You must think of the green card as your return on investment and do not focus on the monetary return. To make sure that you’re, or to at least reduce the risk of losing capital, you should look at robust projects and invest with regional centers which have a good track record.”

That doesn’t mean that people with good track records don’t make mistakes and their projects don’t fail, but there is a certain comfort level in knowing that in the past they’ve been successful and honest about returning their money. Other than that, I leave the investment advice and the choosing of regional center to other professionals.

Today’s conversation is mainly surrounding investors from India. Is she accepting new clients at this point and, if so, does she only work specifically with Indian EB-5 investors or are her services available worldwide?

My services are available worldwide but just because of the nature of our practice, the geographic location of our team, etcetera, all our clients so far have been Indian nationals only. I have advised Pakistani and Bangladeshi nationals on the EB-5 program, but I have not filed any cases for them. Briefly, all our clients so far have been only Indian nationals, but the same rules apply across the world.
The individuals in India that are seeking more information on EB-5 or considering it as a path to US citizenship, the individuals in India are very data-driven, very much researchers, seeking really rich information. Do you have any … I don’t know what to say secret or information that they may not be able to get, but do you have any really deep insights that they may not find on the internet or recent changes or anything that you could share with this audience that they might find elsewhere?

Sure. What I see is that the advice on the Indian compliance, on the compliance with the Foreign Exchange Management Act on the Reserve Bank of India’s Liberalized Remittance Scheme, etcetera, that is the area where many clients are misguided. For example, the LRS does not allow you to receive a gift for LRS remittance for immigration. I have seen many practitioners file affidavits which in their gift affidavit, it’s an affidavit recording the gift to, let’s say a child, says, “I have given a gift of $250,000 to my daughter out of love and affection to enable her to invest in the EB-5 project, X, Y, Z project.”
This is a complete violation of the law, so not only is it a violation in what they are doing, but the violation is recorded in a written document that could be picked up by an Indian official at any time should there be a suspicion, and that could actually bring everything down like a house of cards. A lot of the US practitioners who do come into India and fly in and fly out advising on EB-5, they’ve got a huge market base, they’ve got a huge client base, they’re doing very, very well. But some of the new entrants trip up on these issues and that’s why it’s important to get advise at both ends.
Being triple-qualified lawyers in India, I’m licensed in the State of New York and in India and I’ve got other members in our team who are equally qualified, we have an ability to give clients end-to-end advice and pick up on these nuanced things which sometimes go unnoticed by the untrained eye.

Are there any types of creative financing, so to speak? Could someone sell their home, take a loan, start a business? Are there any strategies or things that you’ve seen as they specifically relate to India that might help an investor who otherwise might not think they qualify?

Under the Liberalized Remittance Scheme you’re not allowed to take debt or take a loan to move money out. For example, if I know that I don’t have $250,000 to move out of the country this year, I cannot go to the bank, pledge my home, get a mortgage and send that money out. That’s not allowed, that’s illegal. Not only that, there are many banks in the United States who offer financing for this. Again, that would be a loan and a person resident in India, a person who’s a tax resident in India, is not allowed to create debt outside of the country, so even getting the loan outside is not legal.
We have seen many parents liquidate their life earnings, life savings, even in rare occasions sell their home, to meet the half a million dollar investment. However, we are very cautious in such cases because the USCIS also looks at the solvency of the person giving the gift after the gift has been made. If it’s going to leave them indigent, there might be questions so you have to be careful about that.
The typical cases are the ones where they’ve got oodles of money and it’s not going to be difficult to prove that they’re going to have more than enough to live on even after they have given the gift, those are the easy ones. The more difficult ones are the ones where you’ve got to prove that they still are solvent after the gift.

Some of our frequent cases are students in the United States, they’re here on an F1 visa, they’ve decided that this is the life for them, America is the place where they want to build a career and a life. What the parents are doing is because they know the uncertainties with the visa system and H1Bs and EB-2, EB-3, et cetera, they are actually giving the gift to the children to make that investment. Those are the ones, these are multi-millionaire, in dollar terms, multi-millionaire parents making these gifts. Those don’t raise too much of a question.

Well, we thoroughly covered a range of topics! I am happy I was able to share to share what I think is great advice, guidance and strategies for EB-5 investors. You can hear the full podcast by clicking on the following link which features the podcast series on the EB-5 Investor Portal https://www.eb5eb5.com/eb-5-podcast/.

Make sure you watch for additional articles as this is a series of articles from Poorvi Chothani.

Please remember that the information in this article and the podcast series is for informational purposes only and should not be used as a substitute for individualized advice from qualified immigration counsel.