No announcement yet.

Article: Making The Right Choice Between Regional Center And Direct Investment With David Hirson By Hermione Krumm, Esq.


  • Article: Making The Right Choice Between Regional Center And Direct Investment With David Hirson By Hermione Krumm, Esq.

    EB-5 Investment Voice; Mona Shah & Associates Global Podcast Series


    EB-5 Investment Voice is the only Podcast series that focuses on and the United States immigrant investor visa, EB-5 and foreign direct investment. Mona Shah, Esq. welcomes guests from the industry, including: Developers, Regional Center Operatives, Attorneys, Legislators and Politicians.

    Of the 15,000 immigration lawyers in the United States, only about 300 specialize in the EB-5 program. An experienced lawyer who understands the nuances of the program and your unique situation can help you navigate the system and make informed decisions around the type of investment you choose to make. Unfortunately, it only takes one misstep along the way to lose your money—and your green card.

    The guest for this episode is David Hirson, the managing partner of David Hirson & Partners. Like Mona, Mr. Hirson has been continuously voted as one of the Top 25 Attorneys by the EB-5 Investors Magazine and is on the list of Year 2017’s Top 25 Attorneys. He has been working on EB-5 cases since establishment of the program, preparing and filing one of the first EB-5 cases back in 1991. Mr. Hirson is an active member of the immigration law community, and his firm is often called upon by trade groups, investors, projects and universities to serve as subject-matter experts on the topic of EB-5 investment visas.

    Mr. Hirson joins Mona in this episode to discuss the differences between a Regional Center and a direct investment, specifically the job creation requirements and the investor’s level of involvement in project management. They cover the common mistakes made by investors who purchase existing businesses and misconceptions among inexperienced attorneys with regard to the two-tier level of investment. Finally, they speak to the difficulty investors face in getting meaningful information from Regional Centers as well as USCIS and the value of securing assistance from a qualified EB-5 attorney.

    Choosing a Top Attorney

    • Though there are 15,000-plus immigration lawyers in the US, only about 300 deal with EB-5. It is arguably the most difficult type of cases to prepare, and it is in an investor’s best interest to work with an expert as failure can be disastrous to them and their family.
    • Investors should try to make sure their attorney understands their specific situation as well as the full spectrum of immigration options available. EB-5 may not be the best choice for some investors.
    • While an applicant could conceivably file an I-526 on their own, the 13-page form can be a minefield. An experienced EB-5 attorney can help you avoid mistakes and deal with any changes to the program in real time.

    EB-5 Investment Options

    · There are two programs under the EB-5 umbrella: (1) Regional Center and (2) Direct Investment.

    · When asked which program the lawyers prefer, David Hirson responds that he prefers the case of direct investment, for the following reason: in a direct project, there must be ten full-time employees per investor on payroll to fulfill the job creation requirements. Regional Centers, on the other hand, can count indirect and induced jobs. If a project is short on the final job count, a direct investment can still get approved by proving that additional employees will be hired within a reasonable amount of time. (USCIS has gotten better about understanding the legitimate reasons why there might be a delay.) In comparison, it is very difficult in a regional center model to increase the job count.

    Level of Involvement

    • Another difference between regional center and direct investment projects involves management. Regional Center project managers are unrelated to the investors, while investors who put their money into a direct project have the option to manage the project themselves.
    • The type of investment an investor chooses should depend on their circumstances. If an investor plans to attend school full-time, it makes more sense to do a Regional Center project that they do not have to manage themselves. If, however, an investor intends to earn an income by managing the project, he/she should choose the direct investment option.

    Common Mistakes

    • Don’t make the mistake of buying an existing business that already employs ten-plus full-time workers and thinking your work is done. Ten new jobs per investor are required to be generated. There is one exception to this rule, but it requires proof that an investor is saving existing jobs in a failing business. If an investor buys a business that has a 20% loss of equity over the last one to two years, he/she may be allowed to count those existing jobs. Again, the investor should ensure that his/her attorney is capable of a careful analysis.
    • Investors should begin with a specific plan regarding how their investment will be used to create jobs and be careful not to over- or under-capitalize.

    Regional Center Pros & Cons

    • Unlike direct investment, the Regional Center program is not a permanent program. So far, Congress has continued to extend the program, but there are no guarantees. The direct investment program, on the other hand, is not in danger of sunsetting.
    • The big advantage of investing in a Regional Center is the unique way job creation is calculated. Businesses generate economic growth in an area, creating new jobs beyond the walls of the business itself as employees spend money in the community. Regional Centers get credit for those ‘hidden jobs.’
    • Unless the business is profitable from the outset, $500,000 is usually not a credible sum for a business with 10 full-time employees.
    • Choosing to invest in a Regional Center project does not prevent an investor from starting their own business in the US. Mona contends that it may be easier to invest in a feasible Regional Center project to get your green card, and then start your own business without the associated worries around immigration.

    Location vs. Project

    • There is a common misconception among inexperienced immigration attorneys that entrepreneurial visas require a $1M investment. The two-tier level of investment actually applies to both Regional Center and direct projects.
    • The option to invest $500K is based on location rather than project type. The smaller investment amount is allowed on projects in target employment areas whether Regional Center or direct investment.

    Staying Informed

    • Perhaps the most frustrating aspect of Regional Centers is that some communicate better than others. Investors often struggle to get the information and documents necessary when it is time to file an I-829.
    • Mr. Hirson contends that it is nearly impossible to get useful information from USCIS. While they do respond promptly to inquiries, the information provided does not offer a real sense of what is going on.

    Please see the link below for access to the podcast episode: .

    About The Author

    Hermione Krumm, Esq. is an associate attorney with Mona Shah and Associates Global. Hermione works with EB-5, corporate, merger and acquisition (M&A), intellectual property and foreign direct investment (FDI) matters involving China, the UK and the US. Hermione writes and comments frequently on current business and immigration issues. Her articles have been published by LexisNexis, ILW, EB-5info, EB-5 Supermarket, etc. Hermione received her LL.B. (Hons) from the University of Manchester School of Law (UK), and obtained her LL.M. from Cornell Law School. Hermione speaks fluent English, Mandarin and Cantonese.

    The opinions expressed in this article do not necessarily reflect the opinion of ILW.COM.

      Posting comments is disabled.





    There are no tags yet.

    Latest Articles


    • Article: The EB-5 Immigration Program and the Investors Process By H. Ronald Klasko
      The EB-5 Immigration Program and the Investors Process by H. Ronald Klasko At Klasko Immigration Law Partners, LLP, we represent businesses, individuals, and organizations across the world with various aspects of employment-based immigration. The EB-5 Immigrant Investor Visa Program is one program through which we help wealthy foreign nationals with no employment sponsorship or family in the United States gain permanent residence status. In the infographic below, we highlight the steps of the EB-5 program and the investment requirements associated with it, so individuals and companies alike can understand the program before coming to Klasko Immigration Law Partners, LLP for assistance. This post originally appeared on Reprinted with permission. About The Author H. Ronald Klasko is recognized by businesses, universities, hospitals, scholars, investors and other lawyers as one of the country's leading immigration lawyers. A founding member of Klasko, Rulon, Stock & Seltzer, LLP and its Managing Partner, he has practiced immigration law exclusively over three decades. Under his leadership, the firm was chosen with five other firms by Chambers Global in 2006, 2007, 2008 and 2009 as the top U.S. business, hospital and university immigration law firm. Ron, himself, was named as the world's most respected corporate immigration lawyer (The International Who's Who of Business Lawyers 2007 and 2008) and one of the country's top immigration lawyers by clients and other immigration lawyers who said he is revered for coming up with unique arguments that can save a clients (Chambers Global). A former National President of the American Immigration Lawyers Association (AILA), Ron served as General...
      08-20-2018, 08:15 AM
    • Article: Immigration Judges’ Union Fights for Judicial Independence By Karolina Walters
      Immigration Judges’ Union Fights for Judicial Independence by Karolina Walters The National Association of Immigration Judges (NAIJ), the union that represents the nation’s immigration judges, is challenging the government’s decision to remove an immigration judge from a well-known case and replace him with a judge who immediately ordered the immigrant in the case deported. NAIJ’s grievance addresses the treatment of one immigration judge, but its resolution will have implications for judicial independence throughout the entire immigration court system. The grievance was filed on behalf of Philadelphia-based immigration judge Steven A. Morley, who was presiding over the case of Mr. Reynaldo Castro-Tum. Castro-Tum’s case rose to national importance earlier this year when Attorney General Jeff Sessions chose to refer the case to himself to reconsider the Board of Immigration Appeals’ previous decision in the case. In reconsidering the decision, Sessions effectively eliminated judges’ use of administrative closure, a docket management tool. Sessions sent Castro-Tum’s case back to Judge Morley, noting that the immigration court order Castro-Tum removed if he did not appear at his next hearing. Castro-Tum did not appear at the next hearing. However, Judge Morley continued the case to resolve whether Castro-Tum received adequate notice of the hearing. Due process requires, at a minimum, that an individual be given notice of proceedings and an opportunity to be heard by a judge. But before the next hearing could take place, the Executive Office for Immigration Review (EOIR) replaced Judge Morley with an Assistant Chief Immigration Judge who ordered Castro-Tum removed when he did not appear at court again. In their grievance, NAIJ asserts that the decision to remove Judge Morley from Castro-Tum’s case and reassign many other cases from his docket resulted in unacceptable interference with judicial independence. The grievance specifically claims that EOIR’s actions violate immigration judges’ authority under the regulations to exerci...
      08-17-2018, 11:12 AM
    • Article: Indirect Refoulement: Why the US Cannot Create a Safe Third Country Agreement with Mexico By Sophia Genovese
      Indirect Refoulement: Why the US Cannot Create a Safe Third Country Agreement with Mexico by Sophia Genovese The Trump Administration is seeking to create and implement a safe third country agreement with Mexico . Under this agreement, asylum seekers arriving at the US border who have travelled through Mexico would be denied the ability to file their asylum claims in the US. Such an agreement would trample on the rights of asylum-seekers, violating both international and US asylum law. In particular, the US would be violating the international principle of non-refoulement , which provides that no State “shall expel or return (“refouler”) a refugee in any manner whatsoever to the frontiers of territories where his [or her] life or freedom would be threatened,” where Mexico has a proven track record of being anything but safe for asylum seekers . The US has also codified Article 33(1) of the Refugee Convention into Section 208(a)(2)(A) of the Immigration and Nationality Act (INA) which provides that it will not return an asylum seeker to his or her country of origin, but may, at the determination of the Attorney General, remove the asylum seeker to a “safe third country… where the [asylum seeker] would have access to a full and fair procedure for determining a claim to asylum or equivalent temporary protection.” Although Mexican officials have not yet indicated whether they would sign a safe third country agreement with the US, asylum advocates should proactively seek to prevent such a devastating policy with a country that lacks adequate asylum protections. As reported by Human Rights First and Amnesty International , 75 percent of asylum seekers apprehended and detained by the National Institute of Migration (INM), the Mexican immigration enforcement agency, were not informed of their right to seek asylum. Even if asylum seekers are able to make their claims, only 30% of the asylum proceedings are ever concluded , and even fewer are granted, leaving many bona fide asylum seekers stranded without a resolution. The treatment of unaccompanied minors’ asylum claims in Mexico are even more dismal. Of the 35,000 minors apprehended by the INM in the first half of 2016, only 138 were able to apply for asylum , of which only 77 were granted protection. Beyond the failing asylum system in Mexico, asylum seekers are also in extreme danger of kidnapping, murder, rape, trafficking, and other crimes by INM officers and civilians. A safe third country agreement with Mexico would violate the United States’ international obligations under the 1967 Optional Protocol to the Refugee Convention, to which we are a signatory, which adopts by incorporation the obligations outlined in the 1951 Refugee Convention, to which the US is not a signatory. Take the example of an asylum-seeker, Mrs. H, who is fleeing politically-motivated violence in Honduras. Her husband, Mr. H, was a vocal political activist who opposed the National Party and members of the Honduran government. Mr. H began to receive death threats due to his political beliefs and reported such threats to the authorities. The authorities, however, di...
      08-16-2018, 02:32 PM
    • Article: Flawed Statistics Undermine USCIS/ICE/SEVP’s Restriction of D/S for Unlawful Presence By Eugene Goldstein, Esq.

      Flawed Statistics Undermine USCIS/ICE/SEVP’s Restriction of D/S for Unlawful Presence


      On August 9, 2018 USCIS published a “Policy Memorandum” restricting the 20-year-old calculation of Duration of Status (D/S) for F-1, J-1 and M-1 entrants (and their derivative families).

      USCIS also published an announcement (hereinafter “announcement”) “USCIS Issues Revised Guidance on Unlawful Presence for Students and Exchange Visitors , and a general discussion “Unlawful Presence and Bars to Admissibility” ...

      08-15-2018, 12:57 PM
    • Article: Update On Express Entry Immigration To Canada By Edward C. Corrigan and Selvin Mejia
      Update On Express Entry Immigration To Canada by Edward C. Corrigan and Selvin Mejia On January 1, 2015 the Federal Conservatives introduced significant changes to Canada’s economic immigration program. Formerly called the Skilled Worker program the new program was re-branded as Express Entry which included Skilled Workers, the Federal Skilled Trades program, and the In-Canada Experience Program. Canada modelled its revamped economic immigration program on New Zealand’s. There is also an Atlantic Immigration program. In addition there is a separate Live-In Caregiver program where individuals can apply for Permanent Residence after two years employment in this category. EXPRESS ENTRY The initial object of the changes was to create a list of Applicants where the Federal Government could select the best and the brightest from the list of Applicants. The Express Entry was supposed have applicants who had an approved Labour Market Impact Assessment (LMIA) and a valid job offer from an approved Canadian Employer. Under the Comprehensive Ranking System (CRS) candidates were award 600 points for having an approved job offer. Applicants would have achieved a point score of around 1,000 with the 600 points for having a valid offer of employment under the CRS. The provinces in Canada were also allowed to select Applicants according to their economic needs and these applicants that were selected through the respective provincial nominee programs by a province were awarded 600 points to be added to their score. Ontario also has a program where graduates from an Ontario University with a Master’s or who were in a PhD. program would be approved and awarded 600 points which virtually assured that they would be approved and provided with an invitation to apply. There is a quota that governs this graduate program. LABOUR MARKET IMPACT ASSESSMENTS Things did not go according to plan with Federal Express Entry. Very few Applicants were able to attai...
      08-14-2018, 12:50 PM
    • Article: USCIS Finalizes Unlawful Presence Policy Putting F, J and M Nonimmigrants In Great Jeopardy By Cyrus D. Mehta
      USCIS Finalizes Unlawful Presence Policy Putting F, J and M Nonimmigrants In Great Jeopardy by Cyrus D. Mehta The USCIS finalized its unlawful presence policy for F, J and M nonimmigrants on August 9, 2018. The final policy makes no significant changes from the draft policy of May 10, 2018. My earlier blog noted the flaws in the draft policy, which persist in the final policy. The final policy incorrectly breaks down the distinction between violating status and being unlawfully present in the US. As of August 9, 2018, F, J and M nonimmigrants who have failed to maintain nonimmigrant status will start accruing unlawful presence. Individuals who have accrued more than 180 days of unlawful presence during a single stay, and then depart, may be subject to 3-year or 10-year bars to admission, depending on how much unlawful presence they accrued before they departed the United States. See INA § 212(a)(9)(B)(i)(I) & (II) . Individuals who have accrued a total period of more than one year of unlawful presence, whether in a single stay or during multiple stays in the United States, and who then reenter or attempt to reenter the United States without being admitted or paroled, are permanently inadmissible. See INA § 212(a)(9)(C)(i)(1). Prior to August 9, 2018, foreign students (F nonimmigrants) and exchange visitors (J nonimmigrants) who were admitted for, or present in the United States in, Duration of Status started accruing unlawful presence on the day after USCIS formally found a nonimmigrant status violation while adjudicating a request for another immigrant benefit or on the day after an immigration judge ordered the applicant excluded, deported, or removed (whether or not the decision was appealed), whichever came first. F and J nonimmigrants, and foreign vocational students (M nonimmigrants), who were admitted until a specific date certain accrued unlawful presence on the day after their Form I-94 expired, on the day after USCIS formally found a nonimmigrant status violation while adjudicating a request for another immigration benefit, or on the day after an immigration judge ordered the applicant excluded, deported, or removed (whether or not the decision was appealed), whichever came first. This will no longer be the case. Under the new policy effective August 9, 2018, any status violation will start the accrual of unlawful presence. The nonimmigrant will not be provided with any formal notice of a status violation, and any violation from the past that has been discovered would have already started the accrual of unlawful presence. According to the pol...
      08-14-2018, 10:51 AM