{"database": "press", "table": "releases", "rows": [["https://www.grassley.senate.gov/news/news-releases/grassley-denounces-inaction-flawed-eb-5-visa-program", "Grassley Denounces Inaction on Flawed EB-5 Visa Program", "2016-12-08", "2016", "2016-12", "Republican", "House", "IA", "Charles Grassley", "G000386", "www.grassley.senate.gov", null, null, "legacy", "Prepared Senate Floor Statement by Senator Chuck Grassley of IowaChairman, Senate Judiciary CommitteeEB-5 Regional Center Program ReformsThursday, December 08, 2016Mr. President, \u00a0One year ago, Ranking Member Leahy and I came to the floor to express frustration that the EB-5 regional center program was extended without reforms. I could easily read the same statement I gave at that time and it would be just as relevant today. \u00a0We are very disappointed that reforms were not included in the continuing resolution, which extended this very flawed immigration program.\u00a0The EB-5 regional center program has been plagued by fraud and abuse. \u00a0It poses significant national security risks. \u00a0There are serious allegations that the program may be facilitating terrorist travel, economic espionage, money laundering and investment fraud. \u00a0Yet, the continuing resolution before us fails to include much needed reforms. \u00a0So after another year, we have yet another missed opportunity.\u00a0The Chairs and Ranking Members of the House and Senate Judiciary Committees have agreed on a package of reforms. \u00a0We have worked in a bipartisan and bicameral fashion. \u00a0We have agreed on every aspect. \u00a0We instituted compliance measures. We instituted background checks. And we instituted transparency provisions. \u00a0We made sure that rural and distressed urban areas benefited from the program, as Congress always intended, and as Senator Leahy very clearly laid out the problems.Despite the bipartisan support, not a single one of our recommendations will be implemented. Instead of reforming the program, we have status quo. \u00a0\u00a0The status quo means this:\u00a0  \u2022\u00a0\u00a0 \u00a0Investments can be spent before business plans are approved.\u00a0  \u2022\u00a0\u00a0 \u00a0Regional Center operators can charge excessive fees of foreign nationals in addition to their required investments. \u00a0  \u2022\u00a0\u00a0 \u00a0None of the jobs created have to be \u201cdirect\u201d or verifiable jobs but rather are \u201cindirect\u201d and based on estimates or economic modeling. Again, not knowing for sure if jobs are created.  \u2022\u00a0\u00a0 \u00a0Investment funds are not adequately vetted.\u00a0  \u2022\u00a0\u00a0 \u00a0Gifts and loans from anyone are acceptable sources of funds from foreign nationals.  \u2022\u00a0\u00a0 \u00a0There\u2019s no prohibition against foreign governments owning or operating regional centers or projects.  \u2022\u00a0\u00a0 \u00a0Regional centers can be rented or sold without government oversight or approval.  \u2022\u00a0\u00a0 \u00a0Regional centers don\u2019t have to certify that they comply with securities laws. \u00a0  \u2022\u00a0\u00a0 \u00a0There\u2019s no set of sanctions for violations, no recourse for bad actors.  \u2022\u00a0\u00a0 \u00a0There are no required background checks on anyone associated with a regional center.  \u2022\u00a0\u00a0 \u00a0The investment level is lower than Congress ever intended. \u00a0  \u2022\u00a0\u00a0 \u00a0Gerrymandering continues and rural and urban distressed areas lose out. \u00a0  \u2022\u00a0\u00a0 \u00a0Site visits or even audits are not required. \u00a0  \u2022\u00a0\u00a0 \u00a0There\u2019s no transparency on how funds are spent, who is paid, and what investors are told about the projects they invest in. \u00a0  \u2022\u00a0\u00a0 \u00a0The preferential treatment we have seen in the past is enabled without strict code of conduct rules. \u00a0Now, that's just some of the things that are wrong. So the four of us on the two committees, in a bicameral and bipartisan way, tried to address awareness and to have process for dialogue leading to reform. My committee held two hearings this year. The house held one. Staff met with every interested stakeholders that asked, and we offered more concessions than we did last year. \u00a0To top it off, we were ready to provide a six-year reauthorization. \u00a0This would have provided long term stability for investors and regional centers. \u00a0 \u00a0But, let\u2019s talk about why this package was not acceptable to some \u2013 notably the U.S. Chamber of Commerce that was the most rigid in not compromising. \u00a0Here\u2019s a list of issues raised by this leading voice of business in opposition to our package:\u00a0  \u2022\u00a0\u00a0 \u00a0They want, in effect, one investment level. \u00a0They don\u2019t want any meaningful discount for rural or urban distressed areas. And, don't forget, this law was passed 20 years ago to help rural and high-employment areas. That's the purpose of it.\u00a0  \u2022\u00a0\u00a0 \u00a0They don\u2019t want visa set asides for areas that Congress selected as targeted employment areas for fear that investors in affluent areas would have to wait slightly longer for a visa.  \u2022\u00a0\u00a0 \u00a0They didn\u2019t want to incentivize foreign investors to fund manufacturing projects that create long term, sustainable and real jobs that this country desperately needs. \u00a0  \u2022\u00a0\u00a0 \u00a0They wanted to make it harder for rural areas to qualify at a discount investment level even though it\u2019s common knowledge that small and rural communities have a harder time attracting capital.\u00a0  \u2022\u00a0\u00a0 \u00a0They wanted certifications and compliance measures to be delegated to the agency. \u00a0They didn\u2019t want Congress to dictate transparency and reporting requirements. \u00a0Our job is to legislate \u2013 not delegate! \u00a0Delegating authority to the Executive Branch on this program would result in more of the same. \u00a0Because even by the departments in charge, there's very little oversight or monitoring now, even if it might be required by law. But not enough of it is required by law. That's why you get away with this stuff.\u00a0  \u2022\u00a0\u00a0 \u00a0The chamber didn't like a provision saying a foreign national had to be 18 years old to invest and obtain a green card through the program. They would like children as young as 14 to be able to make these major financial decisions and invest up to $1 million\u2014a fourteen-year old to do that.  \u2022\u00a0\u00a0 \u00a0They wanted restrictions on where investor funds came from lifted. \u00a0Our package limited a foreign national from taking out a questionable loan or taking gifts from unknown sources. \u00a0One way to find out what\u2019s wrong is to follow the money. We wanted to be sure that those investing were doing so because they obtained funds lawfully. \u00a0The Chamber of Commerce wanted no such restrictions.  \u2022\u00a0\u00a0 \u00a0They wanted foreign governments and sovereign wealth funds to own EB-5 projects. \u00a0They wanted to delay rules saying foreign governments could not own or administer regional centers by requiring bureaucratic rulemaking. \u00a0Despite the changes we made this year on this very strict provision, they continued to water it down in every negotiating session that we had.  \u2022\u00a0\u00a0 \u00a0They didn\u2019t want regional centers to have to consult with local officials about EB-5 projects to ensure that economic development efforts were coordinated. \u00a0  \u2022\u00a0\u00a0 \u00a0They wanted to do away with a requirement that a foreign investor would have to create at least one direct job before obtaining a green card. \u00a0Now here you've got a situation where a program was instituted 25 years ago to create jobs, particularly in rural America and high unemployment areas, to create jobs, and they don't even want the investors to show that they're going to create at least one job. Right now, they use economic modeling to show indirect jobs. Neither the existence of those jobs nor the location of those jobs can truly be verified. Now, when you have the federal government setting up a program like this, that's supposed to create jobs in rural areas and high unemployment areas, wouldn't you think there ought to be a way of showing those jobs are actually created?  \u2022\u00a0\u00a0 \u00a0They raised new concerns about provisions that have been discussed since last June \u2013 such as, requiring regional centers to pay a fee to an enforcement and monitoring fund. \u00a0  \u2022\u00a0\u00a0 \u00a0They wanted a three-day notification of a site visit by the agency to determine if the regional center truly exists. Sure, tell the inspectors you're coming, so you can get everything in order before the inspectors get there.  \u2022\u00a0\u00a0 \u00a0They fought efforts to require transparency of how investor funds were used. \u00a0This is a major problem of the program. \u00a0Nearly every story of fraud relates to how regional center operators use EB-5 funds for their own personal gain and luxury. This program is meant to create jobs, not to help individuals in charge of the program have personal gain and, more importantly, even the luxury that might go with that.  \u2022\u00a0\u00a0 \u00a0But, the kicker in all of this is that these business interests insist on more visas and to make them cheaper. \u00a0They want Congress to increase immigration numbers \u2013 through controversial recapture mechanisms or by exempting certain people from the annual cap. \u00a0The pro-EB5 groups want more visas for an already faulty program \u2013 which means more money in their pockets. \u00a0  \u2022\u00a0\u00a0 \u00a0On top of that, they asked us to make the visa cheaper than it is under current law. \u00a0I refused to do that. \u00a0I refuse to go below the $1 million level that has been in law since 1990. \u00a0The demand for visas is there. \u00a0There\u2019s no justification to further cheapen this program and the green cards that come with it. \u00a0We will have five months until we are faced with another reauthorization. \u00a0In that time, however, I expect that proposed rules changing the investment level and stopping gerrymandering will be published by the end of the year by the Obama Administration \u2013 and I will support these proposed rules. \u00a0I will be asking the new Trump administration to keep them and build off of them. \u00a0Now, in regard to the new administration coming in, they've took a very strong position on various immigration issues, and in taking that position, I would expect them to consider very closely the fraud and the misuse of the EB-5 program. When the Obama administration sees things wrong with it and they can correct those things through regulation, those regulations are some that should be backed up very solidly by the new administration coming inNext year, I will continue to work with Senator Leahy and the House Judiciary Committee. \u00a0But, I will also work closely with the incoming Ranking Member, Senator Feinstein. \u00a0She is not a fan of this program at all, and has been vocal about closing it down because of all the fault we find with it whether it's fraud or misuse of the program or possible terrorist activity taking advantage of it or whatever national security reasons. And some of these have been pointed out by law enforcement agencies at the federal level.So I want everyone to know that change is coming. \u00a0I have always wanted to reform the program. \u00a0But, I\u2019m not sure the industry will ever come around. \u00a0The leadership of this body and the other body could help by ending this program in a continuing resolution, let it sunset and all those people come to the table with a more compromising point of view to correct everything that's wrong here. But the industry love the status quo and the billions of dollars that pour in to affluent areas. And consequently the money is not directed to where it was intended. In 1990 when this legislation was passed, which was to rural areas and high unemployment areas. So I'm not sure with the attitude of the industry that reforms are possible. So, it may be time to do away with it completely. \u00a0I said it one year ago and I\u2019ll repeat: \u00a0Maybe we should spend our time, resources and efforts in other programs that benefit the American people as opposed to benefiting the well healed and the well connected. \u00a0Maybe it\u2019s time this program goes away. \u00a0-30-", 1, "2026-03-30T12:14:52Z", "2026-03-30T12:14:52Z"]], "columns": ["url", "title", "date", "year", "month", "party", "chamber", "state", "member_name", "bioguide_id", "domain", "scraper", "source", "date_source", "text", "has_text", "collected_at", "updated_at"], "primary_keys": ["url"], "primary_key_values": ["https://www.grassley.senate.gov/news/news-releases/grassley-denounces-inaction-flawed-eb-5-visa-program"], "units": {}, "query_ms": 2.074823947623372, "source": "dwillis/congress-press", "source_url": "https://github.com/dwillis/congress-press", "license": "MIT", "license_url": "https://github.com/dwillis/congress-press/blob/main/LICENSE"}