RCBJ Retrospective: Form I-924A as a National Security and Fraud Detection Tool

Form I-924A as a National Security and Fraud Detection Tool ( (Volume 3, Issue 1, March 2015, Pages 21-22)

By K. David Andersson, IIUSA President; President, Whatcom Opportunities Regional Center and Diane Butler, Shareholder, Lane Powell

The results of the December 2014 FOIA inquiry into Form I-924A filings provide a fascinating glimpse into the anti-fraud and national security toolbox of the Department of Homeland Security (DHS) as specifically applied to the EB 5 Regional Center Program (the “Program”). The annual rigorous screening of designated Regional Centers is in addition to the comprehensive USCIS, Department of State, CIA and FBI security and risk analysis of individual investors seeking immigration benefits through the Program and SEC oversight of investment offerings.

Contrary to the often unsubstantiated media speculation, an honest observer of the Program and its management cannot help but be impressed with the significant ability and commitment of USCIS to ensure that the Program is free of fraud and national security threats. Of course, there is always room for improvement, and therefore IIUSA is committed to legislative reform and continued productive cooperation with regulatory agencies and authorities to protect and maintain the integrity and effectiveness of the Program.

DHS uses the I-924A data to screen all participants in the Program, focusing primarily on Regional Center principals and the new commercial entities used for pooling funds. Inter-departmental cooperation, resources, and technology all work to carry out this mission. Based on information gathered through IIUSA FOIA requests and DHS published reports.[1]

Each Regional Center must file an annual I-924A form. Failure to timely file will result in the issuance of a Notice of Intent to Terminate and possibly cause the revocation of the Regional Center designation. No immigration benefits can flow to petitioners filing affiliated I-526 or I-829 petitions through a terminated Regional Center. The I-924A form, as explained in pre-implementation industry stakeholder meetings and rulemaking publications [2], was developed to gather data to enable USCIS to manage three important Program functions:

1. Provide regular screening of principals and investment programs to detect and deter fraud;
2. Record and report job creation resulting from the Program; and
3. Ensure that the regional center is operated in furtherance of the economic development and job creation objectives of the Immigration and Naturalization Act, regulations and current Program policies.

USCIS use of Form I–924A as a tool for weighing fraud and national security concerns in the Program begins with the screening of program principals and investment entities through TECS.

What is TECS?

“The TECS system (not an acronym) is the updated and modified version of the former Treasury Enforcement Communications System. TECS is owned and managed by DHS component US Customs and Border Protection (CBP). TECS is both an information–sharing platform, which allows users to access different databases that may be maintained on the platform or assessed through the platform, and the name of a system of records that indicate the temporary and permanent enforcement, inspection and operational records relevant to the anti-terrorism and law enforcement mission of CBP and numerous other federal agencies that it supports.”[3]

The table below illustrates some of the databases that reside on the TECS platform or are otherwise available for subject screening.[4]

Any information or “hits” detected on any of the TECS databases, based on the investment entity name and/or name and date of birth of a principal supplied on the I-924A, is recorded on a Record Of Inquiry TECS (ROIT) worksheet. These worksheets are classified Law Enforcement Sensitive and distributed internally on a “need-to-know” basis.

Any hit requires a “resolution memo” in order to be cleared. Resolution memos are prepared by USCS Fraud Detection and National Security (FDNS) officers for each hit generated by an I-924A filing. The FDNS officer reviews the databases and related records and must determine that the “case has no nexus to terrorism or national security”.

When the TECS screening is complete the Form I-924A Review Worksheet then mandates the following inquiries:

1. Does the RC website promise repayment of EB-5 investment?
2. Does the RC website display the USCIS logo or suggest that USCIS has endorsed the RC or any of its investments?

USCIS also uses its internal iCLAIMS database to ensure consideration of the following questions:

1. If there is a website, is it promoting the RC?
2. Any derogatory information found on internet search?
3. Financial Documents Review?
4. Operational Structure Change?
5. FDNS Search Fraud concerns found?
6. Foreign ownership information or evidence?

The annual analysis of data obtained from I-924A form is but one of the many tools DHS has at its disposal to help protect the integrity of the Program.  In addition, the Immigrant Investor Program Office has skilled adjudicators and subject matter experts in economics, financial crimes, and corporate law who closely scrutinize investment offerings for compliance with Program objectives.  Instances of fraud or misrepresentation are referred to the SEC for prosecution. Once a petitioner is classified as an EB5 Alien Entrepreneur he/she is then subject to security clearances, criminal and military background checks and medical examinations plus interviews by Department of State consular officers with knowledge of local country conditions.    In short, the U.S. government’s capability to detect fraud and national security concerns is both significant and robust.   Last but not least, all IIUSA members are encouraged to comply with industry best practices and to immediately report any instances of fraud or abuse.

K. David Andersson is the President of IIUSA and Diane Butler is the former Chair of AILA National Customs and Border Protection Committee. The USCIS information was obtained in December 2014 via Freedom of Information Requests by IIUSA. IIUSA is the national membership-based industry trade association for the EB-5 Regional Center Program and currently has 260 Regional Center members, 23 interim associate members, and 228 associate members.

[1] February 2012 DHS Office of Inspector General “Information Sharing on Foreign Nationals: Border Security” and December 2010 Privacy Impact Assessment for the TECS System.

[2] The I-924 form was first proposed in a fee rule in 2010, and USCIS then first discussed it in stakeholder meetings.  The formal public comment process for the I-924 and A Supplement occurred throughout 2012.

[3] Page 2 December 2010 Privacy Impact Assessment for the TECS System

[4] Appendix at pages 25-28 December 2010 Privacy Impact Assessment for the TECS System

RCBJ Retrospective articles are reprinted from IIUSA’s Regional Center Business Journal trade magazine. Opinions expressed within these articles do not necessarily represent the views of IIUSA and are provided for educational purposes.