Nearly all EB-5 projects are structured as private offerings which are subject to the same securities laws and regulations applied to the rest of the private equity market. The immigration component of an EB-5 offering only introduces more complexity.
In the past several years, regulators have focused additional scrutiny on private equity offerings. Now, they have focused their attention on EB-5 as well. Both the SEC and FINRA have specifically identified EB-5 in their 2016 examination priorities.
Private equity is a more mature market than EB-5, with more rigorous controls, processes, and procedures than many EB-5 projects.
However, many of the SEC’s concerns in private equity also exist in EB-5.
As regulators begin to evaluate EB-5 offerings, it is essential that issuers have the right strategies and best practices in place to prepare for increased scrutiny.
Not only do issuers need the right policies and procedures in place to comply with securities laws, they also need the tracking, reporting, and audit trail capabilities to demonstrate that compliance.
NES Financial welcomes your questions and opinions. Allow us to address your business needs by contacting us. We look forward to hearing from you!