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Brooklyn Journal of International Law

First Page

925

Abstract

This Note examines the controversy of the EB-5 Immigrant Investor Visa, which was created under the 1990 U.S. Immigration Act. The EB-5 Immigrant Investor Visa was meant to encourage foreign investment in U.S. real estate. Under the EB-5 immigrant visa program, an investor can obtain U.S. permanent residency through the EB-5 category, if the investor fulfills either of the two requirements. After an applicant proves they have met the requirements, the holder of the visa and their immediate family members can begin their paths to citizenship, first through the Greencard program. While created with good intent, the EB-5 visa program is often used as a shortcut by wealthy foreign investors, particularly Chinese foreign investors, to gain U.S. resident status, thus allowing the global elite to buy citizenship. It is well known that the EB-5 visa program has had many problems with corruption, such as fraud and abuse due to a lack of stringent regulatory oversight. Many specific problems occur within regional centers, which advise foreign investors in purchasing U.S. properties using the EB-5 visa, while there also is a lack of regulation, accountability, and oversight in the EB-5 visa program. The EB-5 visa creates an unfair real-estate marketplace, which is problematic for the United States and its citizens. This Note argues that the EB-5 visa leads to unfair competition for U.S. citizen and residency status, as it favors the foreign wealthy investors. This Note asserts that the United States should follow the Australian model for further regulation on foreign investors in U.S. real estate. First, this Note will examine the current foreign investment real estate laws and policies in the United States and Australia. Next, this Note will uncover the effects of current U.S. law foreign real estate investments, specifically that of wealthy Chinese foreign real estate investors who benefit from the United States’ EB-5 program, and many immigrants benefitting from relaxed regulatory and oversight policies.Finally, this Note will conclude by arguing that the United States must eliminate the EB-5 immigrant investor visa program and use Australia as a model for new legislation and policies, such as enacting legislation similar to Australia’s FATA and implementing a regulatory board, like the FIRB, to help create a stricter regulatory scheme that will provide more oversight and control over the foreign real estate investment marketplace in the United States.

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