Grassley Opposes Lazy Senate Extension of Abuse-Riddled EB-5

Democratic Missouri Senator Claire McCaskill shamed her colleagues yesterday by pointing out that, with talk of recessing again after a seven-week summer break and only a couple weeks of post-Labor Day “work”, the Senate is on track to put in their laziest year since 1956:

“I showed this calendar to people at home. They thought I was kidding,” McCaskill said.

“I think there is like 240 workdays that most Americans work every year,” she said. “By my estimate, I think we’re working about 110 of those. Now, no wonder the American people are angry” [Lindsay Wise, “Senate Is on Track to Work Fewest Number of Days Since 1956,” McClatchyDC, 2016.09.14].

But hey, if Senator John Thune wants to go home early, that’s not all bad. He’ll have more time to debate Jay Williams, and he may finally let the EB-5 visa investment program die. The Consolidated Appropriations Act that Rep. Kristi Noem and Senator Mike Rounds self-contradictorily voted for last December runs out on September 30. That act extended EB-5 without reform. Senator Thune has mumbled minimally about reforming EB-5 but has offered no substantive proposals. EB-5 watchdog Senator Charles Grassley from Iowa has offered EB-5 reforms, and he says he’d rather see EB-5 die right now than skate by without changes again:

We write to oppose a straight reauthorization of the EB-5 Regional Center program in any continuing resolution or appropriations bill that will cover fiscal year 2017.  The program has become plagued with fraud and abuse, and if not reformed it should be allowed to expire on September 30th.

The rampant abuse of the EB-5 Regional Center program has been well documented in recent years. Internal Department of Homeland Security reviews, the Government Accountability Office, media outlets, and our Committee have uncovered serious problems with the program.  Cases of fraud and securities violations, money laundering, exploitation of investors, abused program incentives, and failed projects have become all too common.  Secretary Jeh Johnson has publicly acknowledged significant concerns involving the program and has called on Congress to provide much-needed reforms. It is past time that we do so.

If the program is going to continue in some form, at a minimum, we should provide the Department of Homeland Security with the tools necessary to expand background checks, site visits, audits, and the vetting of projects and investors alike.  We must also better monitor compliance with securities laws, increase program transparency, raise minimum investment thresholds and restore program incentives so more money goes to the communities that need it, as Congress intended.  The Department must also be authorized to sanction regional centers and other program participants for noncompliance [Senator Charles Grassley, letter to Majority Leader Mitch McConnell and Minority Leader Harry Reid, 2016.09.08].

Boy, if we’re worried about abuse and fraud in an immigration program, it sounds like Senator Grassley can point to more verifiable examples in our preferential treatment of rich foreign investors than crimes arising from America’s slow program of vetting and resettling refugees.

Chinese investors and big-city real estate developers are panicking over the prospect of reforms unhitching their gravy train. If Grassley’s reforms make the money-men nervous, that sounds like a signal that Grassley is on the right track.

One Response to Grassley Opposes Lazy Senate Extension of Abuse-Riddled EB-5

  1. mike from iowa

    Reforming EB-5 means more government regulations foisted on free enterprise.

    Wonder where the watchdog was cowering when dumbass dubya’s administation was running amok?