How regional centers should maintain proper oversight for annual certification

Posted by EB5Admin on October 25, 2019

IIUSA has organized a roundtable on regional center best practices for annual certification (form I-924). Some highlights: Timing is crucial — prepare in early September each year. Acquiring third-party documents is a challenge; have agreements allowing you to obtain any necessary information — with consequences in the event of failure to comply. Also, ensure consistent tracking, and well-organized record keeping.

The preparation for a proper I-924 filing is an ongoing responsibility that requires oversight and record-keeping throughout the development of each EB-5 project. A regional center needs to maintain certain consistent practices to do this effectively and prove to U.S. Citizenship and Immigration Services (USCIS) that they are “continuing to promote economic growth.” 

Timing

As the fiscal year ends on September 30, regional centers should prepare to file their I-924 in the beginning of September each year. By contacting licensees and job-creating entities, it gives those entities time to acquire and pass on the information and documents needed to file the I-924 by December 29.

Challenges

Third-party documentation, such as verification of economic inputs, can be difficult to acquire by regional centers, but they must document the amount of investment and the job creation resulting from the EB-5 capital. Thus, a regional center should consistently track the spending of the job-creating entity. If EB-5 fund maintains a subordinate position in the capital stack, it can be useful to collect reporting information from the senior lender.

Organized records are critical

To maintain the necessary oversight, regional centers must keep organized records and files — for both I-924 filings as well as any USCIS audits, construction lenders, and I-829 filings. The record-keeping should include investor subscriptions, project landmarks, construction draw requests, records from each financial source, tax records, and employment records.

If a regional center receives a high volume of inquiries, they should use a customer relationship management (CRM) system for monitoring investor status from prospect to unconditional permanent resident, with the necessary records of the distribution of return on investment and tax documents.

Licensing agreements are needed

If an EB-5 regional center works with third-party licensees, they should have an agreement to acquire any information or documents when necessary. These agreements should have requirements for the timely provision of such information. Without such an agreement, the job creation entity is not compelled to provide the required documentation. And these agreements should include consequences if a timely response is not made.

Read the IIUSA article

  
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