Who wins the White House this November may concern, Khizr Khan in more ways than most Americans appreciate. If Khan’s DNC-inviters take a hit this coming election, so too might his own livelihood.
Before the website of his legal practice was taken down—reportedly his own doing—Khan was apparently advertising his services as a promoter of so-called EB-5 Immigrant Investor Program.
{mosads}A EB-5 investment is a DHS-administered visa program that almost all Republicans say has to be curbed or cut outright. This is because they’ve caused massive, intractable securities fraud.
The EB-5 program lets wealthy applicants, and their families, skip the line for a green card if they invest $500,000 in a viable, jobs-generating business for two years.
Ever since its creation, critics have called it a visa-for-sale scheme. Former labor economics professor at Cornell University,Vernon Briggs, Jr., said the entire concept of investor immigrants “introduces the principle that the rich of the world can buy their way into the United States.” Americans, he says, should view the program “as a source of shame.”
There’s also the scheme part. Under current rules, the business underlying EB-5 projects involve middlemen charged with facilitating the investment and DHS-application process.
These brokers— almost always immigration attorneys—take fat fees of up to $60,000 from each foreign green card-hopeful.
Unfortunately, but not surprisingly, the investment projects themselves are usually junk. After all, if your business plan is good, why not just get a bank loan? Or tap the debt or equity markets?
Indeed, studies from the government itself have found that up to 88 percent of EB-5 applicants never get their green cards as promised.
Take the EB-5 project of Tony Rodham, Hillary’s brother. Between 2009 and 2012 Rodham along with long-time family friend and current Virginia governor, Terry McAuliffe, he created the largest such EB-5 project for its time.
Rodham gathered over a hundred visa-applicants and raising over $65 million to produce green cars (not to be confused with green cards).
Although the project was touted up with much fanfare, featuring media appearances from Tony’s brother-in-law, Bill, the business would go on to produce not a single automobile, leaving all the applicants without a penny of profit or visa to show for it.
Meanwhile, Rodham and his enablers it’s been estimated took in over $7 million. The scandal even resulted in a Republican-led ethics investigation (since stonewalled) against Citizenship and Immigration Services (USCIS) head and former Clinton-appointee, Alejandro Mayorkas.
This was after he apparently fast-tracked visa applications, hereby releasing investor funds, for the company.
The root of the rot comes from Department of Homeland Security (DHS) regulations and the lawyers who navigate them.
Current rules allow the Regional Center and underlying business to be owned and controlled by the same operator (as was the case for Rodham).
This works to incentivize promoters of EB-5 investments to put the quick collection of fees ahead of building a proper business capable of maintaining the ten full-time jobs that are required.
Promoters have to make sure that applicants and investors feel comfortable that their investment can procure these jobs.
As a result, promoters promise investors the moon. In the case of Rodham and McAuliffe, they promised investors their car company needed enough workers to produce a whopping 1 million cars per year.
Unfortunately, only the more scrutinizing investors would’ve realized that’s around 10 percent of all the cars produced in the US every year. That’s mighty ambitious for people whose experience in automobile manufacturing is absolutely worthless.
It’s well known one of the biggest boosters of the program is Senate Democrat leader, Chuck Schumer, mostly due to its heavy use among certain real estate developers in New York, where Khan is licensed.
His predecessor, Harry Reid, is another big booster. He was made the subject of an ethics complaint in 2013 when he pressed Mayorkas to take a “fresh look” at fast-tracking visas for an EB-5 project connected to his lawyer son.
A vote to reauthorize EB-5 comes up at the end of September and Senate Judiciary Chairman, Chuck Grassley’s intent on making sure it comes up short.
However, for Democrats, the program’s apparently highly valuable and whether it survives reauthorization and then the election will certainly mean a lot to some of its clients.
Ian Smith is an investigative associate with the Immigration Reform Law Institute.
The views expressed by contributors are their own and not the views of The Hill.