AAO decisions on source and path of funds appeals
October 19, 2020 6 Comments
Petitioners who believe that their I-526 was denied in error have the option of appealing to the Administrative Appeals Office. AAO decisions on these appeals eventually get published to the USCIS website, where I read them and take notes to learn more about directions in EB-5 adjudications. I also download copies of the decisions, since the recent USCIS website redesign makes the decisions awkward to find, and since USCIS sometimes deletes files (as happened recently with all I-526 decisions from late June 2020 to September 2020, for example).
For community reference, I have made a folder that collects all AAO decisions since 2018 that specifically address source of funds, including a number of decisions since deleted from the USCIS website: https://www.dropbox.com/sh/igmg6anauua0mtz/AAA2uOuDIfTmKd1C72UJV74Ua?dl=0. A majority of the source of funds appeals since 2019 involve petitioners from China or Vietnam whose path of funds included third party exchangers. The decisions help trace the development of USCIS/AAO thinking on the issue of currency swaps, and include a few sustained appeals. While I do not work with EB-5 source of funds, I hope that this collection of AAO decisions will be helpful reference for people who are facing source-of-funds-related RFEs and NOIDs, or litigating on behalf of EB-5 investors. And I would love to see updated industry articles and advocacy on source/path of funds adjudications. The articles I know about (linked below) are from 2017/2018.
In a currency swap, the EB-5 investor sends local currency to the local account of an intermediary, and the intermediary then wires an equivalent amount in US dollars to the investor’s account in the U.S. Starting in late 2016/early 2017, USCIS began to issue RFEs requesting source-of-funds documentation for the intermediary/third party exchanger’s funds, as well as evidence to overcome presumption that the exchange itself was unlawful. Older articles for reference:
- Third Party Currency Swaps: Considerations for RFEs (October 2018) by Jennifer Hermansky in IIUSA Regional Center Business Journal
- How USCIS “indebtedness” and “currency swaps” policies are inconsistent (June 21, 2018) by Kristal Ozmun in EB-5 Investors Magazine
- I-526 Practice Tips to Help Avoid RFEs and NOIDs on Third-Party Exchangers (November 16, 2017) by Kristen Ng in National Law Review
- Moving the Goalposts Yet Again: USCIS Issuing RFEs on Currency Swap Cases, Departing from Years of Accepted Practice (April 4, 2017) by Kelly Goldthorpe and Matthew Galati Green and Spiegel
EB-5 Updates 
Hi Suzanne,
I was reading through the latest language in the stimulus bill and it has “ELIMINATION OF FALL ACROSS”. Does that mean the unused visas in 2020 will not spill over to 2021?
Thanks again!
The House-passed stimulus bill would prevent EB-5 from receiving any visa spill-over (https://appropriations.house.gov/news/press-releases/house-passes-updated-heroes-act). I understand that whatever bill may get passed eventually, it won’t be that bill as written, but I haven’t seen “the latest language.” Do you have a link?
https://appropriations.house.gov/sites/democrats.appropriations.house.gov/files/SUPP_SEP_01_ALL_xml.2020.9.28.1753.pdf#link=%7B%22role%22:%22standard%22,%22href%22:%22https://appropriations.house.gov/sites/democrats.appropriations.house.gov/files/SUPP_SEP_01_ALL_xml.2020.9.28.1753.pdf%22,%22target%22:%22_blank%22,%22absolute%22:%22%22,%22linkText%22:%22PDF%22%7D
Above is the link to the actual bill. Page 2025 and 2026 speaks to the elimination of fall across.
Your link goes to a House document dated September 29 11:54 am, my link goes to a House documented dated September 29 10:10 pm, and linked to a news article announcing that this version passed the House. The version that passed the House indeed eliminates fall across (in Division T Title I on p. 2023-2061). But either way this is old language, and doesn’t tell us what negotiators may be agreeing about now. If you find any versions dated in October, I’ll be eager to see what they contain.
Thanks Suzanne. DC court of appeals actually issued an opinion early this month on Zhang vs. USCIS (indebtedness case). Took five years of litigation to reverse a policy / regulation that clearly conflicted INA and was enacted in violation of APA. Hopefully it wouldn’t be as lengthy of a process if someone litigate USCIS on currency swaps.
See if you can get Kurzban on to the currency swaps issue, which deserves a good fight.