News & Politics

Senate Hearing on Investor Visa Program a Fraud

Sen. Chuck Grassley (AP Photo/J. Scott Applewhite)

The Senate Judiciary Committee had a hearing this week to disparage the one immigration program that creates American jobs and encourages billions in investment in American infrastructure projects – the EB-5 Investor Visa program. Anti-immigration conservatives have teamed up with class warfare progressives to sabotage the program.  Right now, allies of Senator Chuck Grassley (R-IA) are pushing a last-minute regulation drafted by President Barack Obama intended to kill the EB-5 program.

Some Republican Senators are teaming up with the left to put on a full court press to end this program.  A study by the American Action Forum released in January of this year found that the EB-5 program created at least $20 billion in the U.S. economy since 2008, with over $5 billion invested in 2017 alone and over 174,000 jobs (which equates to approximately 16 jobs per investor). This past week, the Senate Judiciary Committee had a biased hearing titled “Citizenship for Sale: Oversight of the EB-5 Investor Visa Program” to make the case that the program is rife with fraud and is a national security threat.  The testimony at the hearing proved the opposite of what Senators Grassley and liberal Dianne Feinstein (D-CA) had hoped.  The hearing proved that this program is subject to increased oversight and policing of bad actors, therefore the program is not in need of a regulatory scheme intended to end the program.

The person in charge of securing the program testified at the hearing about measures taken to provide protections against fraud and foreign bad guys using the program to create national security problems. At the hearing, L. Francis Cissna, Director, United States Citizenship and Immigration Services at DHS testified about increased officers “dedicated to conducting EB-5 site visits” of EB-5 job creating projects. Cissna also testified about the department has “expanded our security checks to cover both regional center businesses and individuals participating in the program” while expanding access to Financial Crimes Enforcement Network (FinCEN) resources to conduct security checks. Cissna also described partnerships with the Securities and Exchange Commission (SEC) and a new practice of conducting remote interviews of foreign investors to increase security measures on monitoring these individual petitioners. The United States Citizenship and Immigration Services has implemented security measures making the Obama era regulations unnecessary.

Yet these factors do not matter to the ideologically driven individuals who want to end many of the legal immigration programs on the books – even when they have proven to be a success in implementing President Trump’s goal of an America First policy with more foreign investment in America that creates jobs. Progressives hate this program because they allow wealthy foreigners to get preferential treatment in getting a visa and prefer low or no skill labor.  This is classic class warfare that some Republicans are ok with if it forwards the goal of terminating, one-by-one, legal immigration programs.  This is a program that should have the full support of free market Republicans who want to create domestic jobs.

A Trump Administration staffer who used to work for Senator Chuck Grassley and embedded in the federal government’s immigration program administration is ushering through the Obama Administration’s EB-5 investor visa program regulation.  Kathy Neubel Kovarik, Chief of the Office of Policy and Strategy, U.S. Citizenship and Immigration Services (USCIS), announced at Invest In The USA (IIUSA) conference in April of this year that her department will get the Obama EB-5 regulatory reform done by the end of the year. These are Obama era regulations that were part of a regulatory blizzard in the last months of the Obama Administration intended to leave behind the footprint of President Obama during President Trump’s term in office.  This specific regulation was intended deter foreign investment and job creation.

The bottom line is that progressives drafted Obama era regulations to sabotage the EB-5 investor visa program because they don’t like the idea of wealthy foreigners getting preferential treatment with regard to immigration policy. Some conservatives are in alliance because they want to dial back all legal immigration programs to lower the overall legal immigration numbers.

The Trump Administration should not push through Obama’s class warfare regulations, because this program both creates American jobs and encourages investment in American infrastructure projects. Congress needs to act in a way that expands the program while making changes that will protect against fraud, but don’t sabotage one of the few legal immigration programs that makes economic sense.