First Wave of Worksite Inspections at EB-5 Project Sites

The Fraud Detection and National Security unit (“FDNS”) at USCIS has launched a first wave of worksite inspections at EB-5 project sites across the country. FDNS, which has experience in inspecting US employers in the H and L visa context, is now charged with conducting random inspections at locations where USCIS expects to observe “direct” employment of US workers as a result of EB-5 capital investment in US enterprises. Last year we wrote about this program with great anticipation and trepidation about the confusion these site visits are likely to engender.

Sure enough, our initial reports suggest that FDNS inspectors are appearing at EB-5 project sites without warning and asking about on-site employees even at locations where construction has been completed and most if not all the jobs for EB-5 eligibility purposes may have been based on construction phase job creation. Whether the site visits also will include financial records of EB-5 regional centers and developers remains unclear, although public remarks by USCIS officials suggest that financial records also will be a core focus. More than likely the site visits will complicate and perhaps delay adjudications of individual EB-5 investor petitions. And given the responsibilities imposed on regional centers, it is expected that site visits could place regional center designations in jeopardy for evidence of egregious violations at EB-5 worksites.

With so much at stake, and understanding that site visits occur without advance notice, advance preparation for FDNS site visits is critical. The well prepared will conduct training of key personnel and prepare compliance documentation in advance of a visit from FDNS inspectors.

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