Support migrant centric journalism today and donate
The US financial regulator the Securities and Exchange Commission (SEC) announced on 8th February 2013 that it has filed a complaint against Anshoo Sethi, a Chicago based businessman. It has instigated legal proceedings against Mr Sethi and his investment trust, the Intercontinental Regional Center Trust of Chicago and frozen $145m of assets held by the Trust after an investigation into a suspected multi-million dollar fraud carried out on 290 investors, mostly from China.
The SEC alleges that Mr Sethi tempted investors into investing in the Intercontinental Regional Center Trust of Chicago not only with promises of returns but also with claims that he could help them qualify for US EB-5 'immigrant investor' visas. It also alleges that Mr Sethi then submitted EB-5 visa applications on behalf of the investors which contained falsified information.
First SEC investigation into EB-5 scheme
This is the first SEC investigation into projects involving EB-5 visas. Mr Sethi claimed that A Chicago Convention Center (as the proposed convention centre was to be called) would create 8,000 jobs. Mr Sethi was seeking 499 investors who would invest $500,000 each and pay a $41,500 administrative fee. At the time that the assets were frozen, he had raised $145,000,000 of investment from 290 investors.
The EB-5 visa allows entrepreneurs to apply for US permanent residence (or for their 'green card' as it is known) if they invest $1m in a US business (or $500,000 if the business is sited in a 'targeted employment area') and create at least 10 full-time jobs in the US. The investor must not be a passive investor but must take an active role in the running of the business with either 'day-to-day' control or an influential role in policy.
In this case, it is alleged that Mr Sethi had told investors that the hotel chains Hyatt, Intercontinental and Starwood were involved in the project and that the Trust owned the real estate on which A Chicago Convention Center was to be built. He also claimed he had acquired all the necessary permissions for construction. In fact, none of the hotel groups were involved and very little work had been done on the project.
$2m in Hong Kong bank account
It is also alleged that Mr Sethi personally appropriated about $2m from the administrative fees paid to the trust and paid them into his Hong Kong bank account.
The US's Department of Homeland Security suspects that there may have been widespread fraud in EB-5 applications and has launched an inquiry into EB-5 applications in general. USCIS are also said to be suspicious of some EB-5 projects and may be investigating them soon.
Sanwar Ali of Workpermit.com said 'I would advise anyone considering an investment that could assist with a visa application to take great care, just as they should with any other investment. If at all possible, you should get help from an immigration professional'.
Workpermit.com is a specialist visa consultancy with nearly twenty-five years of experience dealing with visa applications. We are OISC registered. We can help with a wide range of visa applications to the UK or your country of choice. Please feel free to contact us for further details.
