01.12.17

Statement Of Senator Patrick Leahy (D-Vt.) On The DHS Proposed Rulemaking To Reform The Flawed EB-5 Program

[Senator Patrick Leahy (D-Vt.) issued the following comment Thursday after the Department of Homeland Security released a Notice of Proposed Rulemaking that, once implemented, will make significant improvements to the EB-5 Regional Center Program.  The proposal would raise the minimum investment levels for the first time since the EB-5 program was created in 1990, and it would restrict the ability of high-end real estate developers to take advantage of development incentives intended for distressed areas.  Currently, almost 90 percent of EB-5 investment occurs in areas that rely on economic gerrymandering to qualify as distressed.]

“The Department of Homeland Security’s proposal is a significant step toward improving the flawed EB-5 Regional Center Program.  By providing a much-needed increase in investment levels and by reining in abusive gerrymandering practices, these changes will help restore the program so it creates meaningful jobs in distressed and rural areas as Congress always intended. 

“It will now be up the new administration to see that these improvements are implemented and enforced.  It has been reported that President-elect Trump and his son-in-law, Jared Kushner, have profited from foreign investments made through this government program.  I will be watching to ensure these tough new rules are not dismantled because they may impact the President-elect’s and his son-in-law’s business investments.

“I asked Secretary Johnson to improve this program and am encouraged that he has taken these steps and has initiated others.  But even Secretary Johnson has acknowledged that this problem ultimately needs a legislative solution and I remain committed to protecting investors and rooting out the rampant fraud within the program.  If we cannot take these critical steps, I believe the time has come for the program to end.”

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