Trump’s EB-5 Bombshell: Is the Gold Card Visa a Game Changer or Just Fool’s Gold?
By: Mona Shah, Esq.
EB-5 (also known as the Immigrant Investor Program), a small niche industry catering to high net individuals looking to immigrate to the US under the 5th preference category of employment-based immigration, has become the target of President Trump’s roving eye.
In a move that has sent shockwaves through the industry of investment-based immigration, President Donald Trump has announced plans to scrap the EB-5 program. This announcement, coming just over a month into his administration, has sparked widespread panic among stakeholders who rely on this self-sustaining program that has created thousands of jobs without burdening taxpayers.
President Trump himself and his son-in-law have raised capital under the program. Indeed, back in 2017, we brought you the news of the giant upset with the appearance and speech of Jared Kushner’s sister, Nicole Meyer, at an EB-5 seminar in Beijing.* (Across the board, news articles censured Ms. Meyer for flaunting the close relationship her brother has with President Trump.)
President Trump’s recent announcement, along with comments from Howard Lutnick, the Secretary of Commerce (more details to follow), indicate that the Administration lacks a real understanding of the nature of the EB-5 program and the advantages it continues to bring to the US. (We invite you to follow our blog, where we will be providing a detailed, step-by-step analysis explaining why the proposed Trump “Gold Cards” will likely not be viable” or not a realistic alternative to EB-5.)
In the following sections, we address the most urgent concerns to reassure the numerous clients who have reached out to us over the past 24 hours.
Will the EB-5 Program Be Discontinued and What Impact Would President Trump’s Announcement Have on Existing Investors?
Article I, Section 8 of the US Constitution states that Immigration law (and by extension the EB-5 program) is controlled by Congress. The Supreme Court has consistently affirmed Congress’s authority over immigration matters, as evidenced in cases such as Fiallo v. Bell (1977). Consequently, any decision to discontinue the EB-5 program would necessitate legislative action by Congress, rather than unilateral executive action. President Trump does not have the authority to simply “cancel” the EB-5 program.
If you are an existing Investor, you are grandfathered into the program. Any possible changes will not likely be retroactive. Further, in 2022, the EB-5 program was reauthorized (through 2027) under the EB-5 Reform and Integrity Act (RIA). This reauthorization indicates a level of legislative support, making any efforts to eliminate the program through new legislation uncertain, especially in a politically divided Congress. The United States Citizenship and Immigration Services (USCIS) is responsible for the processing and adjudication of EB-5 applications, a role that is not directly influenced by the White House. While the President can impact immigration enforcement priorities, an attempt to terminate the EB-5 program through executive action would likely face significant legal challenges, similar to those seen in cases like DHS v. Regents of the University of California (2020).
Congress holds exclusive authority over the allocation of employment-based green card numbers. Any amendments to this allocation would require changes to the Immigration and Nationality Act. Although the President can propose new immigration policies, only Congress can enact or amend laws. The President’s role in immigration is primarily through enforcement, utilizing agencies such as USCIS, U.S. Immigration and Customs Enforcement (ICE), and U.S. Customs and Border Protection (CBP).
Thus, while changes to the EB-5 program could be proposed, any attempt to dismantle it would likely encounter immediate judicial scrutiny and require substantial legislative action. Not to mention the flurry of lawsuits that would follow.
Existing EB-5 investors can take some reassurance in the program’s current reauthorization through 2027.
The Future of EB-5 and the “Gold Card” Visa
Despite the recriminations and criticism from figures like Howard Lutnick, the EB-5 program has consistently demonstrated positive outcomes. The Trump administration acknowledges the program’s popularity but do not fully understand the demographic it appeals to, which is not primarily the ultra-wealthy. Since the inception of the regional center program, Congress has been cautious about the perception of “selling” green cards. Numerous articles and lobbying efforts have highlighted that this is an entrepreneurial program where investors assume risk without guaranteed capital return. It is doubtful that many in Congress, including members of the Republican Party, would support the notion of selling U.S. citizenship.
President Trump’s recent announcement seems more strategic than definitive, indicating a desire to reform investment-based immigration rather than abolish it. As a businessman, it is assumed that Trump likely appreciates the economic benefits of the EB-5 program and sees an opportunity to create a new visa category aimed at ultra-high-net-worth individuals. Speculation suggests that the proposed “Gold Card” visa would be a distinct category designed to attract the ultra-wealthy, potentially offering advantages such as exemption from worldwide income taxation. If implemented, this concept could coexist with the EB-5 program, providing an alternative pathway for high-net-worth investors.
Rather than dismantling the EB-5 program, Trump’s announcement appears to signal an effort to expand and rebrand investment-based immigration. His administration might advocate for a dual-track system, preserving the EB-5 program for job creation while introducing a Gold Card visa for the ultra-wealthy. However, unless Congress takes action, which is not likely, the EB-5 program will remain in effect until at least 2027.
This is a developing story with more details forthcoming. Please stay tuned to our blog and podcast (Global Investment Voice) for further insights into this breaking news.
*“EB-5 on the rocks … with a Kushner twist!” by Mona Shah, Esq. May 10, 2017