AILA recently updated their executive summary of the USCIS EB-5 Engagement with the Securities and Exchange Commission (“SEC”). The two page document contains a summary of the highlights from the important April 3, 2013, teleconference with the USCIS and SEC. The SEC noted that the definition of a “security” is broad and most EB-5 investments include the offering of securities that would either require registration or exemption from the registration requirements under the Securities Act. The SEC made it a point of emphasis to note they primarily focus on anti-fraud provisions when conducting enforcement and that all anti-fraud provisions of securities laws will still apply to exempt and registered offerings.

The SEC also clarified some of the existing EB-5 uncertainty regarding broker-dealer registration. The SEC highlighted that individuals who solicit or advertise investments and/or receive transaction-based compensation are required to register as broker-dealers. Further, the SEC also spotlighted the application of the Investment Advisers Act and Investment Company Act to EB-5 regional centers, associated entities, and their respective principals.

Steven Anapoell, from Greenberg Traurig’s Orange County office, has a detailed summary of his thoughts regarding the April 3, 2013, teleconference here, and has previously written on broker-dealer requirements and SEC disclosure documents.