WASHINGTON – In 2010, an interagency working group, including agents from the Department of Homeland Security and other federal agencies with national security responsibilities, recommended discontinuing the EB-5 immigrant investor program’s regional center model because of widespread fraud and national security concerns. However, some of the working group’s recommendations were never shared with Congress. Recent congressional interviews with some individuals involved in the internal working group reveal those fraud and national security concerns remain.
“It’s beyond me why some in Congress are so reluctant to reform a program that has been the subject of so much fraud and abuse. And, it’s even more alarming that certain recommendations by career federal agents who suggested ending EB-5’s regional center model were hidden from Congress for years, while other recommendations have been selectively provided,. As Congress decides how to proceed with the EB-5 program, we need a full picture of the recommendations made by the interagency working group and we need to know why those recommendations never reached Capitol Hill,” Grassley said.
In a letter to U.S. Citizenship and Immigration Services, Senate Judiciary Committee Chairman Chuck Grassley and House Oversight and Government Reform Chairman Jason Chaffetz are seeking agency records relating to the working group and its findings as Congress determines whether to reform the fraud-riddled EB-5 program, which is set to expire at the end of September.
In the transcribed interviews conducted by the House Oversight and Government Reform Committee, DHS employees involved in the working group explained that after careful analysis of the program’s history, investigative efforts and proposed regulatory changes, the group identified “grave concerns about the program’s integrity and our ability to secure it…” The group’s consensus in 2010 was to allow the regional center model to expire. That remained the group’s consensus until at least 2013, according to one special agent who was interviewed.
The EB-5 program provides visas and a path to citizenship to foreign nationals in exchange for investments of $1 million dollar (or $500,000 in rural or high-unemployment areas) in U.S. commercial enterprises. The regional center model allows immigrants to pool their investments. However, the program has suffered from widespread fraud, abuse and national security concerns.
Full text of the Grassley-Chaffetz letter to USCIS follows.
September 19, 2016
The Honorable Leon Rodriguez
U.S. Citizenship and Immigration Services
20 Massachusetts Avenue NW
Washington, D.C. 20008
Dear Director Rodriguez:
In 2010, certain Department of Homeland Security (DHS) components participated in an interagency working group that reviewed fraud and other national security vulnerabilities in the Employment-Based Fifth Preference Immigrant Investor (EB-5) visa program. That year, the components were tasked with responding to then-Secretary Janet Napolitano’s questions about several cases of fraud within the EB-5 program, and making suggestions for improvement. Members of the working group made recommendations to reform EB-5, including the recommendation to sunset the Regional Center Model due to crippling fraud and national security vulnerabilities. Not all of these recommendations were communicated to Congress.
Since spring of 2016, our Committees have been conducting transcribed interviews of Department employees with knowledge of the working group and the recommendations made as a result. According to one special agent interviewed, the recommendation to sunset the regional center model had remained the consensus until he left his post in 2013. The witness testified:
I think it’s well?known, I think, in the anti?immigration fraud enterprise that, you know, INS, and then later ICE, and since then [HSI], held grave concerns about the program’s integrity and our ability to secure it through law enforcement efforts and even what kind of regulatory fixes there were.
* * *
This wasn’t a loose cannon analysis by, you know, a couple of program managers, you know, just going off on a whim or someone tilting against windmills to knock down a program that’s been in existence for 20 years.
I mean, it was a careful and long analysis that we had of reviewing, you know, the program history, our investigative efforts, regulatory fixes that had been proposed, and we submitted it through our chain of command.
* * *
My personal professional opinion, based on all that I’ve experienced as both an agent, an actual program manager, a section chief, and now a supervisory agent in the field, yes, my recommendation would be to sunset the program still.
* * *
I do not think that we were naive at all. I believe our perspectives were informed over many, many years of exposure to the program.
And, also, I don’t think people should be mistaken. It’s not that the investigators who review this program don’t see its value or its potential value, but we see the rampant exploitation.
Congress must make decisions by September 30, 2016, regarding the reauthorization of EB-5 regional center model. The need to ensure the EB-5 program is sufficiently secure from fraud and other national security vulnerabilities is particularly acute given the program’s history of being subject to political influence.
In order to assist us, as we deliberate how to reform EB-5, please provide the following as soon as possible, but no later than 12:00 p.m. on September 21, 2016:
All documents and communications referring or relating to USCIS’s participation in the interagency EB-5 working group, including documents sufficient to identify the individuals who participated in the working group on USCIS’s behalf;
All documents and communications referring or relating to ideas or proposals both internally at USCIS and from other agencies for possible reforms or modifications to any aspect of the EB-5 program, including but not limited to the regional center model;
All relevant security assessments.
The time period covered by these requests is January 1, 2010 to the present. Please produce all documents in electronic format and deliver your responses to the Senate Committee on the Judiciary Majority Staff in Room 224 of the Dirksen Senate Office Building and the Minority Staff in Room 152 of the Dirksen Senate Office Building, and to the House Committee on Oversight and Government Reform Majority Staff in Room 2157 of the Rayburn House Office Building and the Minority Staff in Room 2471 of the Rayburn House Office Building.
The Senate Committee on the Judiciary has oversight and legislative jurisdiction over the EB-5 program. The House Committee on Oversight and Government Reform is the principal oversight committee of the House of Representatives and may at “any time” investigate “any matter” as set forth in House Rule X.
Should you have any questions regarding this request, please contact Tristan Leavitt of the House Oversight and Government Reform Committee staff at (202) 225-5074, or Katherine Nikas of the Senate Judiciary Committee staff at (202) 224-5225. Thank you for your prompt attention to this matter.
Jason Chaffetz Charles E. Grassley
House Committee on Oversight and Senate Committee on the Judiciary
cc: The Honorable Elijah E. Cummings, Ranking Member
House Committee on Oversight and Government Reform
The Honorable Patrick J. Leahy, Ranking Member
Senate Committee on the Judiciary
 H. Comm. on Oversight & Gov’t Reform, Transcribed Interview of [REDACTED], Tr. at 142 (Jul. 19, 2016)
 Id. at 142-43.
 Id. at 202 (emphasis added).
 Id. at 204 (emphasis added).
 See, e.g., Dep’t of Homeland Sec., Office of Inspector Gen., Investigation into Employee Complaints about Management of U.S. Citizenship and Immigration Services’ EB-5 Program (Mar. 24, 2015), available at https://www.oig.dhs.gov/assets/Mga/OIG_mga-032415.pdf; Dep’t of Homeland Sec., Office of Inspector Gen., United States Citizenship and Immigration Services’ Employment-Based Fifth Preference (EB-5) Regional Center Program (Dec. 12, 2013), available at https://www.oig.dhs.gov/assets/Mgmt/2014/OIG_14-19_Dec13.pdf.