EB-5 Risk Alert: Where Are The Jobs?

Following our launch last week, we are pleased to share with you our first installment of EB-5 Risk Alert.

This week, we take a look at the job creation projections of American Logistics International, a Southern California regional center. We believe that American Logistics may not be on track to meet its job creation targets. As you well know, investors in the EB-5 program rely on regional centers to meet job creation goals. Falling short can have serious consequences as it puts one’s immigration status at risk.

Public Relations vs. Performance: After conducting an initial review of publicly available records, we are concerned that American Logistics may have scaled back its growth plans. This can be inferred by comparing claims in its promotional materials with annual figures reported to USCIS in its most recent I-924A Forms.

American Logistics stated in a company presentation that it planned to begin generating revenue from port terminal operations in 2012. The company reported zero port terminal jobs to USCIS in its Form I-924A for 2011.

EB-5 Risk Alert #2 - Image 1(1)

The following year, rather than report growth as it had projected, American Logistics omits port terminal operations completely from its 2012 Form I-924A.

EB-5 Risk Alert #2 - Image 2

Additionally, it appears that American Logistics has not yet created a limited partnership to serve as an investment vehicle for a terminal operations business, based on a review of California incorporation records.

This raises several important questions:

  • Why has its terminal operations project seemingly failed to come to fruition?
  • On what basis did the company make its initial projections?
  • Can American Logistics meet revenue and job growth projections absent a terminal operations business?
  • Is American Logistics providing different information to investors and to the government?

We recommend that current investors and prospective stakeholders considering this regional center obtain and carefully review its projections and business plan.

 

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