On April 5, 2017, federal authorities raided a business run by a California attorney and her father that is suspected of orchestrating a $50 million EB-5 visa scheme. According to the court filings, the father-daughter company, California Investment Immigration Fund, LLC (CIIF), raised money from more than 100 Chinese investors for several business projects. Under the EB-5 program, these Chinese investors would qualify for U.S. green cards if the business projects created at least ten jobs. However, rather than legitimately investing the funds, CIIF hired high school students to pose as full-time employees for fake projects and used the investors’ funds to buy their own personal luxury items, including million-dollar homes, and for other improper uses.
The scheme began around 2008 and went undetected for years. Due to a lack of oversight of the EB-5 program, many of CIIF’s investors were even able to improperly obtain U.S. green cards without investing in legitimate businesses or creating any jobs. Notably, three of the CIIF’s investors who received green cards were fugitives wanted by the Chinese government.
This EB-5 visa scandal marks yet another misuse of the program, which has experienced widespread fraud in the past few years. Whistleblowers have played a critical role in exposing EB-5 fraud and the SEC Whistleblower Program provides a financial incentive for whistleblowers to expose EB-5 fraud.
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