The Integrity Act of 2016 would require foreign agents to register with USCIS. While there may be some flexibility on this issue, it is very likely that EB-5 issuers will be required to disclose the precise compensation amounts paid to agents. In fact, it is a reasonable argument that this is already an SEC requirement on EB-5 issuers.
The Integrity Bill would require RCs to supervise all offers and sales of securities. Would this require RCs to be registered as a broker dealer if they do supervise sales of securities?
Certifications in the Integrity Bill of 2015 require regional centers to have policies and procedures in place to monitor New Commercial Entities (NCE) and the Job-Creating Enterprises (JCE)
Regional centers are being asked to file annual statements which include providing bona fides and background checks, on principals of the regional center, the new commercial enterprise, and the job-creating entity.
An overview of the rules that govern EB-5 business plans and other key considerations and decisions.
The custody rule; Fee deduction rules; Account statement rules; State RIA regulation, Foreign RIA regulation and AIFMD.
Last year the SEC was much more active in the EB-5 industry. I guesstimate that in 2015 there were twenty (20) SEC enforcement actions related to EB-5.
The on-again, off-again Re-authorization Bill became the on-again, off-again Integrity Bill of 2015. While not yet law, the bill's overall direction and spirit should be taken as a clear message of expected best practices and required disclosures. The panel will discuss a number of best practices to consider implementing regardless of whether and when the Integrity Bill gets passed and in some circumstances notwithstanding the bill's specific provisions.
The borrower of EB-5 funds provides information for the business plan which is part of the PPM, so they should be reviewing it, and the NCE should be making sure there are no material misstatements.