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06/29/2018

Congress Should Let the EB-5 Cash-for-Visa Program Expire

Can the EB-5 Immigrant Investor Program be fixed? It’s been over a year since we called for an end to the program that is now set to expire unless renewed by September 30. As we previously wrote: 

Simply stated, the EB-5 Program operates as a cash-for-visa scheme. Whatever economic advantage it might offer is outweighed by the corruption it engenders and negative influence it has on national security and good government.  Congress should end the program or work to reform its governing rules to prevent continued abuse by the political class. 

There wasn’t much congressional interest in ending the program when we wrote that in May 2017, but the tide appears to be turning. The Senate Judiciary Committee recently held a hearing to discuss the EB-5 program with Lee Francis Cissna, Director of the U.S. Citizenship and Immigration Services (“USCIS”), which is the agency responsible for the program. At the hearing, members of both parties and Director Cissna agreed that, barring legislative reform or publication of long-pending modernization rules, the EB-5 program should be allowed to expire. 

Below are the key quotes and exchanges from the hearing:

Chairman Grassley’s opening statement laid out the significant issues associated with the Regional Center Program:  

As interest in the EB-5 Regional Center Program has grown, so have cases of fraud, corruption and threats to national security. There are many, many well-documented examples of the inherent problems in this program. In fact, over the last five years, I along with several of my colleagues, have written over thirty oversight letters highlighting the various vulnerabilities of this visa program. 

USCIS Director Cissna agreed that the program is rife with fraud and should be eliminated. In his opening statement, he said, “In the absence of legislative reforms, I believe Congress should indeed consider allowing the program to expire.”  

Senator Feinstein then prodded Cissna, “That’s the reason I’m concerned with this program, I think its rife with fraud.” In response, Cissna carried Feinstein’s concern even further, stating, “I think a lot of the cases . . .  involve full on criminal activity too. Fraud with our agency is one thing, but then it often gets magnified into full on criminal activity.”  

Senator Feinstein stated, “It’s no secret that I oppose this program. I believe it should be eliminated entirely.” She continued, lamenting that “under the EB-5 system, the wealthy can cut to the front of the line. This on its face is fundamentally unamerican.” These are the same cronyism concerns that we’ve been worried about throughout our time investigating the program. 

Finally, Senator Durbin said, “I am proud to be the only cosponsor of the Grassley-Feinstein bill to eliminate this program, I hope others will join us.” He then claimed that the EB-5 program is “outrageous and embarrassing to this nation.”  

Come September 30, Congress should allow the EB-5 program to expire with or without modernization rules. While the modernization rules would be better than the current system, they will not fix the endemic problems of fraud and corruption with the cash-for-visa program. It’s time to end it.  

Max Menkes is a Research Fellow at Cause of Action Institute.

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10/27/2014

Las Vegas Review-Journal: Ethics panel ‘never received’ complaint against Reid

Read the full story: Las Vegas Review-Journal

Cause of Action went public this week saying the committee had never responded to its complaint filed Dec. 16. Executive Director Daniel Epstein suggested it had either been dismissed without notification, or ignored.

 

In a letter made public on Friday, the group said it got a call back from the committee staff director indicating the complaint was “never received.”

 

Cause of Action then refiled the complaint, calling for prompt consideration. At the same time, it produced copies of a postal receipt showing the original packet was delivered and signed at a Senate address Dec. 20.

 

It was not clear whether the mail was delivered to the committee’s office or to a holding facility where Senate mail is scanned for security.

 

“The notion that committee staff may have lost or otherwise misplaced Cause of Action’s complaint against the majority leader is plausible,” Epstein said Friday. “However the available evidence contradicts the committee’s claim.”

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10/24/2014

Politico: Conservative group: Ethics panel ignored Reid complaint

Read the full story: Politico

Cause of Action said on Tuesday that the committee never responded to its December 2013 complaint that alleged Reid “inappropriately interfered” in asking for reconsideration of immigrant investor visa petitions after they were rejected. The group claims it never learned whether its allegations were deemed without merit or whether the panel’s “silence reflects a failure to properly discharge duties.”

 

“The Committee’s failure to publicly provide reasoned notice for its apparent findings of insufficiency shows an unacceptable opacity,” Cause of Action Executive Director Daniel Epstein wrote in a letter to Senate Ethics Committee Chairwoman Barbara Boxer (D-Calif.) and ranking member Johnny Isakson (R-Ga.).

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10/22/2014

Fox News: WATCHDOG GROUP STILL WAITING ON REID ETHICS COMPLAINT

Read the full story: Fox News

Watchdog group Cause of Action is calling on a Senate Ethics panel to respond to a complaint it filed against Senate Majority Leader Harry Reid in 2013. At the center of the complaint is Reid’s alleged use of his political clout to lobby U.S. Citizenship and Immigration Services to reconsider and approve EB-5 immigrant investor visa petitions where a company receiving the foreign funding was a major contributor to the Democratic Party, and, at the time, was represented by the Senator’s son.

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10/21/2014

Cause of Action Calls on Senate Ethics Committee to Answer for Failure to Respond to Ethics Complaint Against Sen. Harry Reid

FOR IMMEDIATE RELEASE                                                             CONTACT:      

October 21, 2014                                                    Mary Beth Hutchins, 202-400-2721

Cause of Action Calls on Senate Ethics Committee to Answer for Failure to Respond to Ethics Complaint Against Sen. Harry Reid

WASHINGTON – Cause of Action (CoA), a nonprofit government oversight group, today wrote to the U.S. Senate Select Committee on Ethics in follow up to a December 2013 ethics complaint CoA filed against Senate Majority Leader Harry Reid that has received no response from the Committee. CoA’s complaint highlighted Senator Reid’s use of his political clout to lobby U.S. Citizenship and Immigration Services to reconsider and approve EB-5 immigrant investor visa petitions where the principal entity receiving the foreign funding is a major contributor to the Democratic Party, and, at the time, was represented by the Senator’s son.

CoA’s letter highlights the need for the Committee to provide an explanation for why its 2013 complaint did not lead to a preliminary inquiry, despite CoA providing sufficient evidence.

CoA Executive Director Dan Epstein:

We rely on Congress to conduct oversight of bad government behavior, including investigating its own members to ensure that America’s elected officials are behaving ethically. For over 300 days to pass since our complaint was received with no reasoned notice of the Committee’s determination is unacceptable.  The Committee appears to have dismissed Cause of Action’s complaint without engaging in a preliminary inquiry and without explanation, where independent evidence unearthed by the media supports the allegations of misconduct.  The American public, who elected their Senators, deserve an ethics committee that takes its role seriously, and our hope is that the public receives an explanation for this delay in oversight.

On October 23, 2014, CoA sent a follow up letter after Senate Ethics claimed it did not receive the ethics complaint in 2013.

About Cause of Action:

Cause of Action is a non-profit, nonpartisan government accountability organization that fights to protect economic opportunity when federal regulations, spending and cronyism threaten it. For more information, visit www.causeofaction.org.

To schedule an interview with Cause of Action’s Executive Director Dan Epstein, contact Mary Beth Hutchins, mary.beth.hutchins@causeofaction.org

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12/16/2013

CoA requests investigation of Sen. Harry Reid, USCIS in EB-5 abuse

In light of Senator Harry Reid’s (D-NV) expected nomination announcement of Alejandro Mayorkas as Deputy Secretary of the Department of Homeland Security (DHS), Cause of Action (CoA) sent a request for investigation to Chairwoman Barbara Boxer (D-CA) of the U.S. Senate Select Committee on Ethics, calling for the investigation of Senator Reid’s communications with U.S. Citizenship and Immigration Services (USCIS) officials and the potential fast-tracking of EB-5 immigrant investor applications.

CoA is continuing to investigate EB-5 program abuse, and just last week, we wrote to Chairman Issa of the House Oversight and Government Reform Committee urging the committee to examine USCIS’ abuse of the EB-5 program.

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12/11/2013

Statement: Cause of Action on Mayorkas’ Pending Deputy Secretary Nomination

Cause of Action, a government accountability group, sent a letter to Chairman Darrell Issa of the House Committee on Oversight and Government reform urging the committee to examine the U.S. Citizenship and Immigration Services’ (USCIS) oversight of the EB-5 visa Pilot Program. Cause of Action issued the following statement in response to the Senate Homeland Security and Governmental Affairs Committee pending nomination for Alejandro Mayorkas for Deputy Secretary of the Department of Homeland Security (DHS) :

Executive Director Dan Epstein:

“Just this week, Cause of Action sent a letter to the House Committee on Oversight and Government Reform urging the Committee to examine the USCIS’ administration of the EB-5 visa Pilot Program, which is under the oversight of Alejandro Mayorkas. Whistleblowers revealed that Mayorkas fast-tracked visa applications through the EB-5 program, which is being used to finance crony companies while failing to deliver on job creation.  In light of these concerns and the current DHS OIG investigation of Mayorkas, it was irresponsible for the Senate Homeland Security and Governmental Affairs Committee to vote on Mayorkas’ nomination for Deputy Secretary of the DHS before DHS’s internal investigation is complete.”

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