Understanding the Role of Broker-Dealers in the EB-5 Visa Program: Do You Need One and How to Choose Wisely
What is a broker-dealer in the context of EB-5?
A broker-dealer, in the context of the EB-5 visa program, is a registered financial professional or firm that plays a pivotal role in assisting immigrant investors throughout their investment journey. These professionals are regulated by the U.S. Securities and Exchange Commission (SEC) and are typically members of the Financial Industry Regulatory Authority (FINRA). Their primary responsibilities revolve around securities offerings, investment opportunities, and ensuring compliance with U.S. securities laws.
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Do I need a broker-dealer?
The decision of whether you need a broker-dealer in your EB-5 investment process largely depends on your familiarity with the U.S. investment landscape, the EB-5 program's intricacies, and your comfort level in conducting due diligence on potential projects. It is not a requirement for EB-5 investors to work with a Broker Dealer. However, many investors find it beneficial to work with a broker-dealer for several reasons.
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What are the benefits of working with an EB-5 broker-dealer?
How do I choose a EB-5 broker-dealer?
Verify that your Broker Dealer is registered with the SEC and is a member of FINRA. This provides a level of regulatory oversight and accountability. Research the broker-dealer's reputation and track record. Look for reviews, testimonials, and case studies from previous clients to gauge their performance and reliability.
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​Opt for a broker-dealer with experience in the EB-5 program. They should have a deep understanding of the program's requirements, regulations, and the nuances of immigrant investor visas.
Choose a broker-dealer who is transparent about fees, services, and potential conflicts of interest. Transparency is key to building trust in this partnership.
You can use https://brokercheck.finra.org/ to review the history of your Broker Dealer. You should look out for:
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The status of your broker-dealer (active, inactive, suspended, etc.)
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Disclosures of any sanctions or complaints
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What states they are registered to work in
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What types of securities they are eligible to sell (For EB-5, look for Series 7, Series 82, and Series 63)
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