Immigration Insider

Impatience with Priority Date Delays

If there is a single issue (besides the daily barrage of EB-5 inquiries) about which folks have been emailing me the past few weeks , it is definitely the Priority Date situation.  F-1 students, in particular, have evolved from the standard concerns about the transition from OPT to H-1B status (although, in this economy, even THAT is proving difficult) to long-range "when on earth will I ever get my green card?"

With Obama's promised Comprehensive Immigration Reform (CIR) an increasingly distant possibility, transition from temporary status in the U.S. - as a student OR as a professional worker -- to U.S. permanent residency via employment is increasingly nebulous.

What really bugs me, however, is the soothing chant I keep hearing from others in my profession:

"RELAX, you can stay in H-1B status as long as necessary provided you start your PERM process prior to your fifth year in that status." 

That is of little comfort, and TOTALLY unrealistic when seen from the eyes of the prospective immigrant student/professional. IMHO, we can do better than create a situation where 100% of a person's destiny is in the hands of an employer who wields absolute immigration control until the end of the permanent residency process.

A colleague in the EB-5 business describes the whole H-1B and PERM process as "indentured servitude", and we've bantered that about quite a bit.  Seems to me that what I originally perceived as a bit of an exaggeration on his part is precisely what is genuinely taking root in the current economy, still slogging through with a very flawed employment-based immigration process. 

At a time when American competitiveness is most challenged,  it is tragic to put these desperately needed professionals through a process which is the metaphorical opposite of "rolling out the welcome mat".

Expounding on EB5 Visas in China and H-1B Prospects for Next Year

Reporter Stella Chan recently interviewed me for China Media Net, here are the links to the Chinese articles.  This one discusses conflicts of interest in attorneys and agents marketing Regional Centers in China and what investors need to know:

http://www.dwnews.com/gb/MainNews/2010-02/2010-02-10-14-03-58-622-3.html

This one covers my thoughts on Comprehensive Immigration Reform (CIR) and prospects for H-1B numbers in the coming year.

http://www.dwnews.com/gb/MainNews/2010-02/2010-02-10-14-07-11-625.html

If Stella is being funny and I'm ordering Peking Duck or something, please let me know...(-;

Commercial Real Estate Financing And Why EB5 Investors Should Care

The Miami Herald published an article today by Elaine Walker regarding commercial real estate financing and what’s coming down the (Turn)pike.  You can read the article here but I wanted to point a couple of things out for those of you close to deciding on an EB5 Regional Center…not just in Florida but anywhere.

We’ve all been told that things are “getting better” in real estate; I personally don’t buy it, notwithstanding the statistics which, when viewed at just precisely the right angle and light, suggest we are “rebounding”.  Granted, that perception contradicts what is being said by every realtors association in the country, and it certainly isn’t like me to be pessimistic.  But Ms. Walker did a great job of telling the story objectively…and what can be extrapolated from can have MAJOR consequences on today’s EB5 Regional Center activities.

The problem, you see,  is that no matter how the numbers add up…the numbers just don’t add up!

The article reported on Urban Land Institute's South Florida Economic & Development Outlook gathering, which took place on Tuesday.  Consider these points made in the article:

-Delinquencies on Commercial Mortgage Backed Securities are expected to steadily increase from the current level of about 4 percent, hitting a peak in late 2012 at 12 percent.

- the abundance of ``extend and pretend'' loan rewrites, lenders to extend the term of a loan in order to avoid writing down the value of the asset, which could have seen as much as a 50 percent decline.

Only Dr. David Altig, senior vice president and director of research at the Atlanta Fed, was quoted in terms of linking the commercial real estate finance market with what I personally think is the big pink elephant in the room, ignored by almost everyone in the sector: ``If the unemployment rate doesn't come down significantly, the lifting of the fog is not going to happen,'' he said.

Bingo.  No jobs means no business expansion, which means now growth in commercial real estate…unless it continues to be speculative in nature, as it is right now in certain markets…and as it was right before this whole real estate nightmare began in the is country.

So here’s the point: last year, the number of USCIS-approved EB5 Regional Centers nearly doubled and our phones are ringing off the hook with developers who have “discovered” the EB-5 Regional Center mechanism and who are being told by some attorneys that, ahem, they will be glad to get them approved as a Regional Center.  Most of these are, of course, equity-based programs linked to commercial real estate projects…projects which had been shelved or, at least, slowed by the unavailability of construction lending.  Some are great programs with sound planning a first class management; others, frankly, have left me incredulous…honestly amazed that USCIS would grant Regional Center status to structures almost surely poised for doom.

 

And no, I will NOT tell which those are because I have no interest in getting sued.

 

I will leave you with the question you, as a potential EB5 Regional Center investor, should be asking him or herself:

 

“Does it make sense for me to invest in an EB5 Regional Center when:

 

a) I will be holding an equity stake in commercial real estate in this market

 

b) I will be investing as a limited partner in a commercial-real-estate-driven, equity-structured Regional Center precisely when commercial lenders deem such investments as risky AND

 

c) Even if all goes well, I have no clear exit strategy through which to retire my investment funds?? "

BTW: if you are being promised a “buyback” (such as what many Chinese brokers are telling their clients), RUN for the hills: no risk equals no green card, period.

Choose wisely, my friends.  Choose wisely.

Signs of Old Age...

Okay, so this is how you realize you've been doing something for a loooooooooong time: You are trying to find the answer to a cryptic question you think you once had figured out. You search on Google. You promptly find a long-winded article you wrote on the subject 3 years ago as the 4th link on your Google search, only to realize that the question was as cryptic then as it is now... Oy. All that being said, here is the question and answer for those of you who have better things to do than read a big article: THE QUESTION: How large and established must an employer be to file an H-1B petition? Can a company petition for its owner as an H-1B? THE ANSWER: It depends...(-: FOLKS: please bear in mind that a lot of what was relevant in 2006 is not so today and new worksite issues have arisen.  Don't take the following as gospel but more as an overview of the issue, okay?  J -------------------------2006 Article begins------------------------ How large and established must an employer be to file an H-1B petition?

Written by Jose E. Latour

Sunday, 31 December 2006

How large and established must an employer be to file an H-1B petition? Can a company petition for its owner as an H-1B? Okay, this is one I "sort of" tackled in a prior FAQ discussion, but it's time to take the bull by the horns and resolve this once and for all. Once again, I am running off at the keyboard more than most, but I am doing so because this issue is critical, particularly to the flood of clients we are getting which are foreign-national-owned IT startups in burgeoning software consulting fields. For those folks, reading this carefully is worthwhile. For the rest of you who want a quick answer, skip all my blabber and go down to the bulleted points below, skimming the rest...that should get you the quick answers you need. Okay, here goes the treatise... First, a little background: when I left the Foreign Service and started my private practice, I knew A LOT less than I thought I did about employment based visas. As a Visa Officer in Mexico and Africa, I had adjudicated thousands of visa cases, and felt pretty comfortable saying that I knew the law well. WRONG. As a busy Visa line officer, you are facing an astonishing workload and a million other pressures associated with living in a new culture. While I was conscientious about reading the updates, I didn't have the time to dig and analyze. I found out the hard way when I started private practice that answers to questions like this FAQ just were not anywhere to be found. So, in my innocence/ignorance, I did what I could... Among the first H-1B's I filed in those first months of 1990-91 were small companies, because that was all I could find as clients. I mean TINY, in some cases BRAND NEW companies. Rebuttals came from the INS but, lo and behold, they got approved. I have clients that think I was filing these and getting these approved because I was a really good attorney; the truth: I was a really INNOCENT attorney! Soon, a small group of AILA members and me were becoming known as able to get small company H visas approved where other, more established firms would not TOUCH these cases. Finally, around 1994, I was speaking at an AILA national convention and I was challenged point blank by a VERY established, reputable immigration attorney. His position: you MAY be getting these approved via INS ignorance, but these cases are NOT within the scope of standards defined by the law. So, with the white glove ceremoniously whacked across my cheek, I set off to prove my position. I wrote a letter to Jacquelyn Bednarz, Chief of Non-Immigrant Visa Operations (You may recognize her name: in prior articles on usvisanews.com I have unabashedly raved about Ms. Bednarz as a beacon of light in an often impenetrable Washington INS bureaucracy). I got a call from her office saying that, coincidentally, another attorney had asked the same questions about small company H-1Bs and "Self-employed" H-1Bs, and that the answer was forthcoming and would be shared with Interpreter Releases, the weekly bible of immigration attorneys. Sure enough, I was right: when the response was published, Ms. Bednarz responded (paraphrasing her): There is nothing in the regulations to preclude a corporation or other legal entity as the "employer" from petitioning for an individual who is a shareholder in the corporation. However, a self-employed individual could not petition for his or her own H. Vindicated, and resisting the urge to call up my colleague with a bucketful of I-told-you-so's, I realized that given this guidance -- the position the INS had taken consistently with the small company H-1Bs I and other attorneys were getting approved -- begged another question: "Just exactly how big and established did a company need to be since the law and regulations did not set minimums?" The answer has never been, to date, provided by INS, but the responses on adjudications over the years have centered around a central issue: the company's ability to pay the wage. The cases which were approved most quickly were those with either the most employees (establishing a history of paying wages) or megastartups, with skyrocketing growth from day one. It was like the INS had informally adopted an adjudication standard consistent with what the DOL is supposed to do with labor certifications: confirm that before the case is filed, the employer has the ability to pay the offered wage from day one. So, with that published, the number of small company Hs filed went through the ceiling, and the rest of the immigration community which had been skeptical joined in the filings. Along with those of real, up-and-coming small companies were a barrage of really weak, this-will-never-fly type cases by attorneys more interested in collecting a fee than in helping their clients...stuff no one legitimate would touch. So INS did what it had to do: began denying these cases. One would think that, ultimately, an appeal would clarify these issues, even if the appeal upheld the denial, but it never happened. Small wonder: the cases denied were for tiny companies who could not afford the money nor the two plus years of appeal time...life went on and the standards continued to be vague. Up until about just recently, our firm was still routinely accepting cases from small companies with brief histories and small earnings, and getting them approved. Currently, we have one such case pending, and it was returned with an INS request for further evidence involving the ability to pay wage. I should have seen it coming: since around September, I've probably gotten a dozen plus e-mails from H-1B employers horrified to learn that their attorney had the case denied. When I inquired, the fact pattern was the same... The INS taking the position that the job wasn't "real" but, rather, a manipulation of the H category for self-employment purposes. But WHERE was the legal reasoning behind this? I just don't see it. I suppose the part that bugs me the most is that in the mountain of employment visa legislation we have seen this decade, there has not been a single item changing what Ms. Bednarz confirmed and what a few of us knew all along. Why the increased scrutiny? Was it because America was more anti-immigrant? Is it because the India priority dates are backlogged and more and more IT professionals are looking for alternatives and trying to put their futures in their own hands -- via their own companies -- instead of sticking with the large national firms? Is Bill Gates behind all of this? And why the "trampoline room," while we're on the subject of Mr. Gates? HUH?! Sorry. I digress. Conspiracy theorists, knock yourselves out, but please spare me the e-mails! Anyway, as a result of all this, our firm has set these minimum standards for H-1B case acceptance: The employer must have a six month history of profitable activity. The employer must have at least three full time U.S. workers. The employer must have provable contracts indicating future activity. Of course, these criteria are not static. If I get a month-old, two man company with a $2,000,000 contract on Microsoft letterhead for the development of a new protocol, you can bet your H we would not turn that away... These are sort of general critiria. (ATTORNEY READERS- if your firm has "minimum size" H employer policy, we would love to hear from you.... Tell us what the policy is, and your rationale, since you may think I am way off base....) So, there's your semi-answer...sorry it isn't more clear but, hey, this is immigration practice, not something precise and clear like quantum physics. I will leave you with... JOSE'S UNSCIENTIFIC MAXIMS FOR SMALL COMPANY H-1B VISAS The smaller the number of employees, the longer the history you need; the shorter the history, the more U.S. employees you had better show. While contracts for future services are fine, they will NEVER substitute for a history of verifiable income. If the company is filing for its shareholder, the standard of company strength is higher than if the same size company is filing for someone not "related" to the company. The INS will not approve petitions for small companies engaged in the speculative hiring of professionals ("body-shopping"), particularly in the IT and health fields unless their financial strength and history can be proven. Once the regulations defining the new "no bench" provisions are finalized, you can count on this being an even tougher standard for such companies.

  ------------------end of 2006 article-------------------

In Praise of Biometrics

It was back in 1988 when I first sat down to teach Border Patrol officers stationed at the very porous El Paso/Ciudad Juarez border the difference between legitimate "Micas " - border crossing cards (BCCs) - and those which were fraudulent.  Incredible as it seems, the profitable art of subtle photo replacement and modified signatures was thriving along the U.S./Mexico border long before the advent of the color copier would make places like Manila epicenters of sophisticated document fraud.

Back in Juarez, we saw it ALL.  I could write a book about the fraud perpetuated at the border, and I remember lively discussions with my wonderful visa section boss, Mike Hogan, and our incredibly astute Consul General, Louis Goelz, over the problem.  I served as Fraud Officer for a period of time in Juarez, responsible for what were known as "Stateside Criteria" cases...immigrant visa processing of individuals who had married U.S. citizens and who wanted to get their permanent residency approved at a convenient border boast in Mexico or Canada instead of flying home to wherever.  Juarez, as it happened, was responsible for NYC area cases, and about 80% of the marriages we interviewed were bogus.

In the midst of the scams, I advanced an idea to my bosses, and they thought it was a fine one:  why not simply 1) include thumbprints on BCCs and 2) integrate federal criminal fingerprint and photo data at a national level, allowing border entry posts to have access to FBI ID verification information? It was a fine idea, promptly filed in the circular file by the State Department.

Well, here we are 21 years later, and the "new" concept of biometric ID enhancement is all the rage.  The TWIC card is foolproof and will keep our ports safer, we are told.  Yet there remains a certain vocal resistance to the implementation of basic biometric technologies because "in America we don't want a national ID card."  The logic behind that is valid, but rooted in emotion: the horrors perpetrated by the Nazis against the Jews and others was in large part organized via the issuance of identification cards, and the post war reaction was that this kind of documentation did not belong in the land of the free and the home of the brave.

Yet the concept of a national ID has continued to be the common denominator in systems utilized by some of the most civilized and democratic countries in the world.  In Latin America, the "cedula" - the ubiquitous nationa ID document - is part of everyone's daily life, sort of a combination SSA card and internal passport.  In America today, with the dual problems of illegal immigration and threat of border-crossing terrorism, common sense dictates that we need a fresh look at this option.

Several days ago the Wall Street Journal brought this issue up, and several U.S. congress members - one Democrat and one Republican - wrote what I felt was a pretty good comment to the editor.  Here you have it in its entirety:

"The Journal’s editorial “Blame the Employers” (July 16) is right to point out the shortcomings of the federal government’s E-Verify employment verification system.

Database inaccuracies and a vulnerability to identity theft and document fraud render E-Verify far from foolproof, and can subject employers to harsh sanctions when the system fails them. The government should not lag behind by continuing to cling to an employment verification system that has proved to be inadequate.

Where we disagree, however, is in equating biometrics with a national ID card. Use of state-of-the-art biometric technologies is already happening in the private sector and does not require using a card.

Consumers are increasingly given the choice to use biometrics to either prove or protect their identities, whether at the airport or at the ATM. A thumbprint or a retina scan is not the same as an ID card, as it cannot be forged, stolen or misused.

 That’s why utilizing biometrics this way in the employment verification process to confirm identity is included in our bipartisan House bill, H.R. 2028, the “New Employee Verification Act.”

Yes, there will still be unscrupulous employers and “off the books” employment, but that’s where the government should be focusing its enforcement resources—not on plant raids on law-abiding businesses with properly verified employees."

Rep. Sam Johnson (R., Texas)
Rep. Gabrielle Giffords (D., Ariz.) Washington

The Madoff Reflex: Offshore Private Wealth Clients Flock to New Money Managers

While the headlines have been full of painful stories regarding those who lost millions to Madoff's Ponzi scheme, wealthy clients who did not invest with him are taking a fresh new look at their financial management teams...and deciding they can do better.

Last week, as reports of client defections from UBS were sifting through the Internet, Credit Suisse’s CEO, Walter Berchtold, told London's Financial Times that Credit Suisse had actually been attracting more “new wealth clients” so far in 2009 than anyone else.  The CEO has his “eyes set on besting UBS”, still considered to be the number one player in the sector.

According to another article on the subject of wealthy investors' response to the financial crisis,  42% of high net worth individuals  “are likely to review or switch wealth managers in the wake of the financial crisis”.  It would appear that these are precisely the customers Mr. Berchtold is wooing with CS' "OneBank" concept, an institutional effort to keep clients in-house as much as possible by offering collateral services beyond what has traditionally been handled by wealth managers. (To me it is remeniscent of the multidisciplinary efforts of the Big Eight accounting firms before the notion of full-function consultancies was the norm...but then again, I'm old...)

In yet another article in the International Herald Tribune last week, the single biggest complaint these very clients have about their current money managers: “the speed of response to crisis” and inadequate “levels of communication and contact"...the very issue most frequently raised in bar complaints filed by clients against their attorneys.  Meanwhile, those increasingly nervous bankers remain firmly out of touch with what their clients think about them: 75% of wealth managers believed their clients trusted them; in reality, only a third said they trusted their money managers. 

Bottom line: the wealth management industry is being reshaped by its investors, who believe that they have NOT been well-served by their managers as the current financial crisis has unfolded (and will continue to unfold).  The fact that Madoff's scam was invisible to most of these managers -- and to an SEC which ignored internal warnings and gave Madoff a thumbs-up more than half a dozen times -- has shaken the trust of those with most at stake, who are in the "there but for the Grace of God go I" mode.

Mr. Berchtold is seeing movement in his direction, but it is only the beginning.  If you fall in this category and are looking for a fresh, responsive, pro-active wealth management team, contact me at jlatour@latourlaw.com for some straight answers.

Why Are There So Many CRUMMY Immigration Attorneys?

I haven't written here in awhile and I hate to get back in the saddle via a RANT, but I am seriously upset: in the past two days, I have been approached by not one, not two, but THREE prospective clients sharing the same basic problem: their otherwise straightforward immigration case has been disemboweled and trashed by a licensed Florida attorney with absolutely no fundamental understanding of U.S. immigration law.

This is all part of a dark trinity which South Florida immigrants have long faced:

1. The tragic belief that countrymen will not rip you off (when, in fact, it is most often Colombians who rip off Colombians, Chinese who rip off Chinese...the nature of the con game...remember: "con man" is short for "confidence", and upon this they prey.)
2. The legal pandemonium that is Miami, where immigration is perceived as a profitable sideline by attorneys who have not a shred of knowledge about federal immigration laws and
3. A population of illegal or semi-legal immigrants too eager to believe in "shortcuts" and "inside connections" as a result of their own cultural backgrounds.

The saddest part is that in each of these three cases, a competent immigration attorney would have easily obtained the needed approval.  Instead, I am facing three tangled Penn Senator reels of absolute incompetence, chaotic birds' nests of convoluted support letters, improper petitions, and gaps in status.

If I was Immigration Judge Dread Florida Bar licenses would be shredding like confetti these days.  Grrr.

Time for a Cool Change

Barack Obama was inaugurated as the 44th U.S. President today, and what a ride it's been. To me, one of the most intriguing (and admirable) qualities of this man is how his pragmatism seems to defuse agendas.  In these past days, I've discussed this sea change in our national agenda with a number of friends, both Democrats and Republicans.  I find it very interesting that all but the most jaded Republicans -- who will never be happy with any Democratic President, regardless of what he is able to accomplish -- I've been speaking with acknowledge that Obama's still, cool waters run deep indeed, and that the fact that he is the best public speaker any of us has ever seen and a poster child for American intelligentsia does not, as previously alleged, imply a "Slick Willy-ness" beneath that impression.  Most see a good man with a good team seeking to reconcile a previously divided nation, and they are willing to give him a chance.

But the real surprise has been the number of those who ACTIVELY campaigned for and totally supported Obama and are now griping.  Everything from his decision to keep Gates as SOD to his nominees so far to his willingness to adjust his military agenda in accordance with what military leaders are telling him has been mentioned, and they all say the same thing: he promised one thing and now he's doing another. 

After his speech today -- what a speech, huh? -- I took my sons, Danny and Alex, out to lunch.  I wanted to spend some time with them today, and I probably sounded like an old codger when I explained to them why, to me, this day was so important not only for America, but for the world.  We had a lively conversation, and I told them to remember today because, one day, their grandkids will want to know about it.  Alex, my eldest (a junior at UF, my double alma mater), was in a hurry because he had his -- get this -- Korean History class at 1:50.  So we ate quickly, chatted more quickly, and Alex the sign-waving, mighty Democratic Reformer left me with a parting thought:  "Dad, I still support him fully but I would no longer call myself an Obama 'fan' ".

The reasons he said that were consistent with what most passionate Democrats are saying, the kind of stuff I mentioned above.  Basically, they want radical change and they want it now...but I am extremely glad that President Obama is, above all, a consensus-building reformer whose pragmatism dictates his actions.  We've had WAY too much of the opposite for eight years.

Yes, it is time for change.  BIG change.  But we have strayed so far from America's iconic role as THE global leader that an abrupt series of military, economic, immigration, etc. policy changes would turn this big tanker called the U.S. sideways with the momentum.  And going from upside down to sideways only causes more chaos, as we know from The Poseidon Adventure.  To continue with this analogy, it will take careful adjustments in the ballast to right this ship.  He who furiously lashes out against the quicksand is a goner, while he who studies his escape options has a fighting shot at freeing himself.

I believe that this dedication to understanding the facts is not only the OPPOSITE of inactivity, but the very essence of why this Chief Executive will excel in his new job.  Had this always been the case, we would not be at war, and the notion that carefully studying your options equals dilly-dallying is yesterday's tabloid news.  Reckless policy making has become standard in Washington, and knee-jerk responses to immigration enforcement, for example, have had devastating impact on both U.S. employers and working immigrants.  Grace under fire beats "damn the torpedoes", especially when everyone else has torpedoes, too.

It is indeed time for change, and since the election I've become a BIGGER fan of President Obama because under his leadership, it will be an intelligent, pragmatic change for the better.

Illegal Immigrants Flow Home from U.S.

Today's Miami Herald front page story is about the economy and how illegal aliens are heading home.  It is Sunday and I don't have much to say today except this:

Immigrant labor, legal or illegal, is like any other commodity and affected by supply and demand.  The unskilled workers who are the bedrock of much of a healthy U.S. economy by filling the jobs Americans don't want cross the border illegally to make a buck because they have no way to legally work here despite the demand for their services; when their labor is no longer needed, they go home.

Instead of demonizing these workers, why not establish visa categories which permit them to work legally when the economy has recovered and our hospitality, manufacturing, and construction sectors again need them?  If we can have visas for foreign "professional workers" despite the loud rumbles of the health-care, IT, and various other U.S. labor lobbies...what is the rationale for not permitting similar temporary visas for those jobs which are so rarely filled by U.S. workers that labor lobbies for them simply do not exist?

Modest Proposal #2: How to Help the Auto Industry AND Consumers

This one is simple, though the relevance to immigration is, uh, vague:

-The government is giving the auto industry $25 billion dollars
-There are about 200 million drivers in the U.S.
-That breaks down to $125 per driver
-Let's hypothesize that a driver buys a new car every 5 years and forget that many drivers do not own cars
-Multiply $125 by 5 = $625

Instead of giving the cash to a failing industry, lets offer $625 vouchers available on a first come first serve basis, with a six month expiration, only valid for U.S. manufactured vehicles.  The consumer cuts his/her best deal without divulging the voucher and when they are ready to sign, the voucher goes to the dealer.

This not only gets the money in the hands of the consumers, it stimulates demand AND allows free market dynamics, i.e., the money ends up in the hands of the U.S. companies which are most attractive to U.S. consumers.

Guys, this isn't that hard! (-:  Jose