EB-5 Investment Specialists - Creating American Jobs through Foreign Investment

Accredited Investor Requirement Explanation

EB-5 visa investors need to have SEC’s accredited investor status in order to invest in EB-5 Projects. See the most frequently asked questions about accredited investor status by EB-5 visa investors below:

 

What does it mean to be an accredited investor?

An accredited investor, in the context of a natural person, includes anyone who:

  • earned income that exceeded $200,000 (or $300,000 together with a spouse) in each of the prior two years, and reasonably expects the same for the current year, OR
  • has a net worth over $1 million, either alone or together with a spouse (excluding the value of the person’s primary residence).

On the income test, the person must satisfy the thresholds for the three years consistently either alone or with a spouse, and cannot, for example, satisfy one year based on individual income and the next two years based on joint income with a spouse. The only exception is if a person is married within this period, in which case the person may satisfy the threshold on the basis of joint income for the years during which the person was married and on the basis of individual income for the other years.

Is it Required to be an accredited investor for EB-5 visa investment?

Yes.

For all our EB-5 projects, we have an accredited investor requirement as per SEC (United States Securities & Exchange Commission) requirement. Meeting the requirement is needed. The definition of Accredited Investor may not be easy to understand so if you have any doubt on your ability to meet the requirement, please contact us.

How do I get verified as an accredited investor?

There are two main ways to get verified as an accredited investor. Firstly, you can provide us the relevant information and we will obtain the Accredited Investor verification letter from our own resources OR) you may obtain a verification letter from your own licensed attorney or accountant. For a sample of an Accredited Investor Verification Letter that your selected attorney or accountant could write, fill in the form below and we will send it to you.

I am choosing to show that I am an accredited investor because of my net worth. Does this mean the minimum investment for a TEA project is $1,000,000?

No. You just have to show that you have $1,000,000 in net worth but the minimum investment for a TEA project is still $500,000.

When do I need to provide the accredited investor verification?

We will request simple documentation and confirmation of your eligibility when we initially start conversations but we must have a third party’s letter confirming your Accredited Investor status at the time of subscribing to the investment.

Why are other EB-5 Regional Centers not requiring that I have to be an accredited investor or provide real verification and documents?

Firstly, if you are an EB-5 investor who already is in the United States (Student F-1 Visa or H1-B visa) then you ABSOLUTELY need to have accredited investor status. With the JOBS act and the change from the SEC to allow general solicitation through Reg D Rule 501 The SEC now requires that Investors can no longer self certify their accredited investor status. For some EB-5 offerings, they rely on REG S, which is entirely an international offering with absolutely no marketing activity taking place in the United States including the promotion of anything through their website.

“I live in the US already, I am not an accredited investor and another regional center will still admit me to their project. What is the worst that can happen?”

They would be violating SEC laws. The only foreseeable reasons they would allow you to subscribe to their project is because they are desperate to find EB-5 partners or they are negligent, either one is not inexcusable by the SEC. If a securities offering is caught by the SEC violating it’s exemptions (REG D or REG S etc.), the entire EB-5 offering may have to be cancelled, the sponsors barred from the industry, repay all investors and all I-526’s would therefore be denied.

I am thinking that I qualify because of my net worth being over $1,000,000 not including my primary residence. What assets can be included?

Many items qualify as assets and contribute to your net worth. Here is a short list of suggestions for things that could be considered assets: property, stocks, bonds, 401k or IRA retirement funds, Cars, Boats, Planes, Other Vehicles, Gold, Silver, other commodities, office furniture, computer equipment. If you have questions on what counts, please fill in our form below!

 

Download the SEC’s Investor Bulletin explaining the Accredited Investor Requirements

Accredited Investor Explanation

Are you an Accredited Investor?

We can help you figure it out. Please contact us get started with Accredited Investor Verification and your EB-5 investment.

Accredited Investor Verification Help Form

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SEC Explanation of Accredited Investors

Under the Securities Act of 1933, a company that offers or sells its securities must register the securities with the SEC or find an exemption from the registration requirements. The Act provides companies with a number of exemptions. For some of the exemptions, such as rules 505 and 506of Regulation D, a company may sell its securities to what are known as “accredited investors.” The term accredited investor is defined in Rule 501 of Regulation D.

For more information about the SEC’s registration requirements and common exemptions, read our brochure, Small Business & the SEC.  For more information about how individuals can be accredited investors, see our Investor Bulletin on accredited investors.

If you are an accredited investor and want to see some EB-5 projects, start browsing our EB-5 projects now!

Categories EB-5, EB-5 Explanation, EB-5 Policy, Uncategorized