The number of people from other countries -- especially China -- who want to invest in the United States in exchange for a permanent resident visa reached its highest level in 2015.
The program is known as EB-5 or Employment-Based Fifth Initiative. It was created in 1990 during the presidency of George W. Bush and supported by both major political parties.
The United States Citizenship and Immigration Services says the program gives permanent resident status to those who invest at least $1,000,000 in a new project “that will create or preserve at least ten full-time jobs in the United States” within about two years. The agency says a foreign citizen needs to invest just “$500,000 if the (project) is in a targeted employment area,” which includes some rural areas and areas with high joblessness. Critics of the program say much of the investment takes place in wealthy cities like Dallas, New York and Washington.
The USCIS reported there were 17,691 requests for EB-5 visas in 2015. In 2013 there were 6,554 requests.
Experts say the reason for the sharp increase last year is rich people were worried that the program would be cancelled. But in December, it was extended for 10 months.
The USCIS told Congress that an estimated “$8.7 billion has been invested into the U.S. economy through the EB-5 program since October 1, 2012.” It estimates “35,140 jobs have been created for U.S. workers through foreign investment via the EB-5 program.”
The Wall Street Journal newspaper recently reported that more than 80 percent of the EB-5 visas are given to Chinese investors. The newspaper reports many investors are given two or three visas and use them to give family members permanent resident status.
Chinese students wait outside the U.S. Embassy for their visa application interviews in Beijing, China.
Without the program, many of them would have to wait many years before they could legally enter and live in the U.S. The U.S. State Department reports some Chinese citizens who have asked for visas without taking part in the program have been waiting since 2001.
Questions raised on the visa program
In 2014, The Washington City Paper reported that Chinese take part in the program not to make money but to be able to educate their children in the United States. Another reason, the paper reported, “is the ability to own private property, which can be difficult in China.”
The Government Accountability Office reported last year that some people who have asked for or been given an EB-5 visa might have lied about where they earned their money. The GAO report said some of the money that is invested in job-creating businesses may come from the “drug trade, human trafficking or other criminal activities.”
The report said the USCIS should increase its efforts to prevent and find fraud in the program and should ask people who are applying for an EB-5 visa to give more information. It also said USCIS should study the program to see how many new jobs are created. USCIS said it agreed with the GAO recommendations.
Senate Judiciary Committee Chairman Chuck Grassley, left, and ranking member Pat Leahy in 2015.
Republican Senator Charles E. Grassley of Iowa is a frequent critic of the program. He recently told The New York Times “it’s no secret that the program has long been riddled with corruption and national security vulnerabilities.” Last week, he led a Senate Judiciary Committee hearing that investigated the reported abuse of the “targeted employment area” part of the program.
Senator Dianne Feinstein is a Democrat from California. She has said “I don’t believe that America should be selling visas and eventually citizenship.” And she said “The right to immigrate should not be for sale.”
Senator Patrick Leahy, a Democrat from Vermont, has supported the EB-5 program since it began. But he recently called for major changes.
In a statement, he said “fraud and abuse cannot be tolerated, no matter where it occurs. Even when there is no indication of fraud, the incentives that Congress created to direct EB-5 investment to underserved areas are regularly abused. Given the significant problems plaguing this program, I will continue to push for meaningful reform. Without reform, I believe the time has come for the program to end.”
Carolyn Lee is an attorney and managing partner at the EB-5 group at the Miller Mayer law firm in Ithaca, New York. The firm says it has helped raise more than $3 billion in EB-5 funding for projects in at least eleven American states. It has helped investors gain more than 5,000 visas. It has been involved with the program for 20 years.
She told VOA “there’s no question that the program can be improved.” She says Congress needs to watch the program more closely, and she said background investigations should be more thorough.
But she disagrees with Senator Feinstein that the program sells visas and citizenship to rich people.
“I don’t think it is quite fair to characterize it in that way. We confer immigration benefits based on a number of factors. The policy goal that is furthered with this program is U.S. economic growth,” she said.
She says visas and citizenship are “an asset, an ideal, almost sacred. What do you want to give for this national asset?”
I’m Christopher Jones-Cruise.
Christopher Jones-Cruise reported this story with information from The Wall Street Journal, The Washington City Paper and The New York Times newspapers, Fortune magazine and USCIS.gov. Hai Do was the editor.
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status – n. the official position of a person or thing according to the law
via – preposition by means of (a person, machine, etc.); by using (something or someone)
riddle – v. to fill (something) with something that is bad or unpleasant -- usually used as “riddled with”
incentive – n. something that encourages a person to do something or to work harder
plague – v. to cause constant or repeated trouble, illness, etc., for (someone or something)
background – n. the experiences, knowledge, education, etc., in a person’s past
characterize – v. to describe the character or special qualities of (someone or something)
confer – v. to give (something, such as a degree, award, title, right, etc.) to someone or something -- usually + on or upon