“The most powerful narcotic in the world is the promise of belonging.” —Kalle Lasn
Opening a business in the U.S. is complex enough without citizenship issues. I’ve helped countless people realize their dreams of going to work for themselves and building companies they believe in. When the folks with the vision are not U.S. citizens, their eagerness to put up a “We are Open” sign can overshadow their thoroughness when it comes to the intersection of business and immigration law.
Believe it or not, some people –including lawyers — can exploit that.
The federal government has incentivized foreigners looking to open a business in the U.S. and also gain citizenship. If that’s your goal, then you may need an EB-5 visa. Let’s explore what you’ll need to achieve your dream.
A Brief Overview of the EB-5
The Immigrant Investor Program is known as EB-5 for the name of the employment-based fifth preference visa that participants receive and was created to stimulate the economy. It caters to entrepreneurs (and their immediate families), who will be eligible to apply for permanent residence if they:
- Make the necessary investment in a commercial enterprise in the United States; and
- Plan to create or preserve 10 permanent full-time jobs for qualified U.S. workers.
In short, if you can create or fund a business that employs at least 10 Americans, full-time, you can be rewarded with a green card.
However, you should ask your lawyer if you should be referred to an immigration lawyer.
Because Some Firms Double-Dip
Late last year, the SEC leaned on some immigration firms that may have been acting as unlicensed visa brokers.
The complaint was filed in federal district court in Los Angeles and was the mark of a major crackdown on this type of activity.
One immigration firm made some headlines and in a press release, the SEC alleged that it:
…acted as unregistered brokers by selling EB-5 investments to more than 100 investors, and also defrauded clients by failing to disclose they received commissions on the investments in breach of their fiduciary and legal duties. They also allegedly defrauded some entities offering the EB-5 investments.
Though this firm was the only one formally named in the complaint, the SEC was obviously making an example of it and its principal. Other firms took note because recently, several lawyers made settlement payments to the SEC “without admitting or denying the SEC’s findings.”
Collectively these firms’ questionable actions cost them $727,484 in disgorgement, prejudgment interests and penalties.
Imagine if you’d acquired an EB-5 from one of these firms and found out that your status was now under the government’s microscope. I cannot imagine that you’d want anything to hold up the opening of your proverbial shop.
The Takeaway for Small Business Owners
If you are a non-citizen looking to start a business in the U.S., you’re encouraged to try your hand. Initial hirings will be among the most critical actions you take. That formative period requires workers who understand and share your vision for the business — those willing to get their boots in the mud for you.
It’s important to confirm if your lawyer is a reputable immigration attorney. If he/she is not, be sure to connect with one to ensure your business will not be subject to scrutiny.
Contact us to discuss how work visas can impact your small business.