HOW INVESTORS
CAN PROTECT
THEMSELVES IN
EB-5 DEALS
G
iven recent incidents in
the
industry,
investors
should harness this power by
choosing projects that offer protection from these risks.
In the United States, numerous
projects are vying for investor cap-
A GUIDE TO EB-5 INVESTOR RISK EXPOSURE
AND OTHER TOOLS OF RISK MANAGEMENT.
ital—offering investors the power
of choice. Investors want to invest
in funds that are in line with their
By Bonnie Novella
personal risk and investment return
goals, but may overlook the risks in
projects that don’t offer the proper insurance to protect investors.
This article outlines the risks EB-5 investors’ face and details the available insur-
Investing in EB-5 projects has
ance solutions to mitigate those risks.
inherent risks, but many immigrant
investors may not realize that they
have significant power with project
A World of ‘Risk Management’
sponsors to demand protections
The term “risk management” is commonly used in the business community to talk
from these risks.
about controlling risk. Many times, EB-5
investors may not be cognizant of the risks
they are exposed to during a project, along
with ways to protect themselves from these
risks. EB-5 investors should put their focus
on projects with the highest risk management
standards and ones that offer the necessary insurance coverage that protects investors.
One of the biggest risks that EB-5 investors face
is the complete loss of capital. This magnitude
of investor losses can be averted with insurance
solutions available for EB-5 projects today. Due to
the fact that regulatory agencies don’t require risk
insurance protecting investors, it’s the responsibility
650 Business Plans
550 Economic Impact Studies
170 Regional Centers Designated
of project sponsors to ensure that such coverage is
provided.
EB-5 investors should make risk management a high
priority, and invest in projects that offer this type of coverage. Using this method, investors can essentially eliminate the risks connected with an EB-5 project—knowing
they will obtain a permanent U.S. visa and a complete
return of their capital.
71
EB5 INVESTORS MAGAZINE
WWW.EB5INVESTORS.COM
72