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It is quite common for EB-5 visa seekers to encounter unethical and unscrupulous individuals. EB-5 visa seekers and immigration attorneys need to ask probing questions that will help them separate the newcomers and dishonest people from the honest and ethical people.

Here are some questions that can help EB-5 visa seekers and immigration attorneys make better informed decisions:

For EB-5 visa seekers interested in Direct Investment Business, the following questions are crucial:
1) What is your role and how are you qualified to fulfil that role?
2) What is the license you hold and how does it qualify you?
3) What is your practical experience in EB-5 visa? How many clients have you helped so far and how long have you done so?
4) What is your track record? Have your clients experienced capital loss, visa loss or operating loss?
5) What do you do to help me avoid getting defrauded?
6) Do I fully own and control my business and capital?
7) What is the exit strategy?
8) What is the typical approval time?
9) Are you willing to offer a notarized guarantee saying that you will fully disclose all material facts in an ongoing manner and refrain from engaging in conflict of interest?
10) Do you offer a turnkey solution?
11) Do you expect me to pay for your mistakes, or will you refund my fees in case I'm denied due to your negligence and / or incompetence?
12) Do you owe a fiduciary duty to your clients?

Critical questions to ask of a regional center CEO and CFO:
1) Are you willing to offer a notarized guarantee confirming that you will fully disclose all material facts in an ongoing manner and refrain from engaging in conflict of interest?
2) What is your practical experience? How many clients have you helped so far and how long have you done so?
3) What is your track record? Have your clients experienced capital loss, visa loss or operating loss?
4) What do you do to help me avoid getting defrauded?
5) What is the exit strategy?
6) What is the typical approval time?
7) Do you fully comply with the securities laws of the US and overseas jurisdictions where you offer and sell securities?
8) Will you refund my fees in case my petition is denied due to your negligence or incompetence, or am I expected to pay for your mistakes?

An honest service provider will never expect a client to pay for the mistakes and negligence of the service provider, and will always agree to fully disclose all facts. We believe in honesty, transparency and accountability, and we always put our client's interests ahead of our own.

This is an effective preliminary checklist to help EB-5 visa seekers avoid getting defrauded:

1. EB-5 visa seekers should demand NOTARISED AFFIDAVITS signed under the penalty of perjury from the CFO, CEO and Attorney of the regional center confirming that:

a) All material information has been disclosed to the EB-5 visa seeker. If material information is not fully disclosed, then the regional center's executives are engaged in SECURITIES FRAUD, and EB-5 visa seekers as well as honest immigration attorneys and visa consultants should avoid them like the plague.
b) The regional center is in FULL compliance with US Securities, tax and foreign exchange laws as well as the laws of the country in which the securities are being sold. If the regional center is violating securities laws, tax laws or foreign exchange laws, the EB-5 visa will most likely be revoked or denied, and the funds will be seized and may potentially be subject to forfeiture.
c) The regional center procures products and services in a competitive and transparent manner, and does not engage inconflict of interest and nepotistic (related party) hiring. After all, you do NOT wish to pay inflated salaries to some regional center promoter's mistress or nephew, do you?

If a Regional Center's executives REFUSE to present the above information in notarized affidavits to investors, EB-5 visa seekers should AVOID their offering like the plague because the regional center is definitely attempting to defraud investors, as US law clearly states that failure to disclose all material information is defined as securities fraud.

EB-5 visa seekers should also ask regional center executives and attorneys to answer the following questions in a notarised affidavit signed under the penalty of perjury, answering each question separately:

a) How long has the Regional Center / business been operating?
b) How much of a capital loss have investors seen (minimum, maximum, median and mean)?
c) What is the exit strategy and how much will it cost investors to exit and is exit mandatory only through related entities?
d) Does the Regional Center / project have a STRICT arm's length policy for procurement of products and services in a competitive manner?
e) Do they regularly offer audited books of accounts for review by investors?
f) Have they ever faced any criminal investigations or lawsuits?
g) Are they in full compliance with tax and securities laws in the US and country of offering?
h) What is the annual dividend? Is it paid regularly? Is the dividend enough to let the investor and his / her family live comfortably or is it below what even a bank would offer?
i) How long is the investment locked in and can investors exit right after they get the I-829 approved or are they locked in for 5-9 years?
j) Do investors have a right to kick out corrupt or incompetent managers who fail to perform?
k) How much are their fees and what is the breakdown? This is to identify the junk fees.
l) What is their money back policy?
m) How much equity have the promoters invested and how much money (salary / share of profits / benefits, etc.) are they getting?
n) Are officers and directors hired in an objective and competitive fashion or do they hire related persons such as girlfriends, friends, wives, nephews, etc.?
o) Have investors ever exited with a capital gain?

I believe the above affidavits should be a good starting point to detect and prevent fraud committed by regional centers. Those regional centers that don't disclose all material information or engage in conflict of interest and nepotism are undeserving of the trust of EB-5 visa seekers. For more information on how to get the best results for EB-5 visa seekers, please add me to your network and join my group 'EB-5 experts - Direct Investment' on LinkedIn.

EB-5 visa seekers should remember that it is a lot quicker to gain approvals for I-526 petitions on basis of Direct Investment Businesses, while petitions filed by regional centers have been languishing for a year or more. They should also remember that there is a massive interagency investigation by DHS, SEC, IRS and FBI, and it is expected that over 98% of the regional centers will be shut down for violating securities laws and committing securities fraud. There was a very interesting conference call that USCIS and SEC had in April 2013, where SEC announced that they're going to take strong action against regional centers and partnerships that violate securities laws such as broker dealer registration, investment company regulations and failure to disclose material facts.

The above is my opinion, PLEASE consult a qualified attorney for advice to confirm that the above is correct.

Yours truly,
Mohammed Shaikh, MBA, CFE, Licensed Business & RE Broker (CA & FL)
Online: http://www.smartbusinessbroker.com

We can easily search on Google to discover hundreds of examples of fraud committed by regional centers.

SOME EXAMPLES OF EB-5 FRAUD COMMITTED BY REGIONAL CENTERS ARE:

http://www.sec.gov/news/press/2013/2013-20.htm

http://www.nasaa.org/3752/top-investor-threats/

http://cis.org/north/two-more-eb-5-projects-vermont-and-virginia-are-trouble?goback=.gmp_3747690.gde_3747690_member_229689396

http://eb5info.web11.hubspot.com/bid/134818/eb-5-visa-investor-lawsuit-alleges-fraud-deceit-in-new-orleans-regional-center-investments?__hstc=161489384.a64bf8828487988cd4fd6f6e638a7009.1365329429569.1365329429569.1365329429574.2&__hssc=161489384.1.1365329429574

http://www.usa-immigration.com/litigation.htm

http://eb5info.web11.hubspot.com/bid/105193/huge-chicago-eb-5-multi-hotel-project-under-scrutiny-by-investors?__hstc=161489384.a64bf8828487988cd4fd6f6e638a7009.1365329429569.1365329429569.1365329429574.2&__hssc=161489384.1.1365329429574

1. Exclusive visas and their team, including Joe Sloboda, Fred Burgess, Renata Castro, N. Guru, etc. They also conduct business under the name EB5Match.com. We've reason to believe that this group has facilated the illegal offering and sale of US securities overseas and have also engaged in serious securities fraud. It is also believed that they've misled EB-5 visa investors into buying substandard franchises such as Voodoo BBQ.

2. Brian Su, Thom Casebolt, etc. of Artisan Business Group: We've reason to believe that this group has facilitated the illegal offering and sale of US securities overseas and have also engaged in securities fraud and facilitated money laundering.

3. Marc Hyman: Pretends to have EB-5 experience, but I seriously doubt this as I've personally found him to be unfamiliar with a lot of legal processes related to EB-5 visa processing. He also conducts business brokerage activities illegally through Pacific West Investor Services, which is NOT licensed by the CA Dept. of Real Estate to offer business or real estate brokerage services.

4. Lalit Advani: From personal communication with him, I learnt that Mr. Advani illegally offers and sells US securities in India, and in addition to committing securities law violations is also engaged in an ongoing conspiracy to commit securities fraud.

5. Varun Gupta: Has already been arrested once for fraud, and has a pending fraud case against him for forging bank documents and fabricating records. See www.indianexpress.com/news/healthyway-fraud-ca-sent-to-police-remand/839566/ Mr. Gupta is a Chartered Accountant and is an expert at money laundering, and now seems to have graduated to being an active co-conspirator in committing securities fraud, violating securities laws and laundering funds. His website is http://www.eb5indiacenter.com

6. Chaim Katzap: We've reason to believe that this individual has faciliated the illegal offering and sale of US securities overseas and also engaged in  securities fraud. I also suspect he is affiliated with Organized Crime.

7. John Shepherd Senior and Junior: Illegally offer US securities in the US and abroad, and engage in securities fraud by failing to disclose material facts. 

8. Anthony Rodham, Terry McAuliffe and GreenTech Automotive: I've solid reasons to believe that they've committed securities fraud, violated securities laws and laundered millions of dollars.

There are also several service providers who claim to do "Due Diligence" about regional centers and EB-5 partnerships, but are actually just taking the investor's money and not doing due diligence in a professional and thorough manner. Some of these service providers are listed below:

1) Wassem Amin: I asked him online about how exactly has he done due diligence, and he had no answers, and instead fled the forum and went on to start his own. I mean, just how can someone miss the fact that securities were being marketed and sold illegally without authorisation of the overseas regulators, commissions were being paid illegally, and material facts (such as procuring goods & services from related parties as well as related parties being hired at inflated salaries) were being withheld from the investor (which qualifies as securities fraud in the US)?

2) John Roth, John Muller and Laurie Wu of EB5DueDiligence.com: They claim to do due diligence, and like Mr. Amin, they also fail to advise investors about the fact that securities were being marketed and sold illegally by the regional centers without authorisation of the overseas regulators, commissions were being paid illegally, and material facts (such as procuring goods & services from related parties as well as related parties being hired at inflated salaries) were being withheld from the investor (which qualifies as securities fraud in the US).

3) Michael Gibson: I thought he was honest, but I stand corrected now. Like the other 2 above, Mr. Gibson also fails to advise investors about the fact that securities were being marketed and sold illegally by the regional centers without authoriation of the overseas regulators, commissions were being paid illegally, and material facts (such as procuring goods & services from related parties as well as related parties being hired at inflated salaries) were being withheld from the investor (which qualifies as securities fraud in the US).