After speaking to brokers in China, EB5 visa program service provider Brian Su believes the recent ruling handed down from China's Supreme People's Court is a very serious turn of events for EB5 marketers.
On January 25, Su will be hosting a seminar in New York City that addresses this topic for regional center operators, immigration attorneys, and other EB5 practitioners. Additional speakers will include Jason Lee, who is on the Board of the Beijing Exit-Entry Administration, Gillian Shuang of PKF China, Lu Sun of Maslink, and Walter Huang, an expert on Chinese securities.
According to Su, brokers view the the court's interpretation as a warning from the Chinese government, and they have suggested a few ideas to protect EB5 visa program brokers and regional centers ?
- The emphasis should be on providing immigration services rather than selling "investment" projects.
- Review client service contracts to ensure that there will be no "investment' elements in the clauses; again ? focus on immigration services.
- Avoid any "investment" OR "return" claims in the public media ad campaign.
For regional centers:
- Review your finder (agents) agreement to re-position or re-define the relationship between regional center and broker.
- Closely watch marketing materials put out by brokers.
- Pre-approve all marketing materials by brokers.
- Closely monitor broker conduct in the marketplace.
- Cut ties immediately with brokers who do not comply with Chinese law; one bad broker in the broker network will cause damage to all brokers who promote the same EB5 visa project and regional center.
Su also offers the following comments:
"In the past, some regional centers may have felt that Chinese broker conduct had little to do with the regional center, and they turned a blind eye to broker activities. It is now very risky for regional centers to ignore such activities. If the general public has a massive loss of funds (in a project), the authority will go after not only brokers, but also trace the root (regional center) in the US.
"In the past it might have been a civil offense, and the broker may have lost his or her license, but now it would be a criminal offense. The broker may go to jail! If no large quantities of project funding are lost at this point, you will not see much enforcement; however, if massive fund loss occurs as a result of EB5, someone will be in trouble or in jail."
To register or learn more about Brian Su's seminar, visit the Artisan Business Group's event page.