LLC or Partnership agreements that govern EB-5 investments are frequently very one sided — against the immigrant investors’ interests. This imbalance can pose substantial challenges when attempting to resolve major disputes, like the return of investment funds.
While regional centers can contract away a lot of typical investor rights, there is one thing they cannot strip away and that is an investor’s right to file an SEC whistleblower tip, especially if there’s evidence of fraud, deceit or gross mismanagement. Evidence that you or other EB-5 investors were misled into making the investment, or that the EB-5 funds were mishandled, could be used in an SEC whistleblower tip.
If the SEC pursues the tip and brings an enforcement action based off the tip, you might be entitled to a significant financial reward. Whistleblower awards can range from 10 to 30 percent of the money collected when the monetary sanctions exceed $1 million. Previous awards made by the SEC have ranged as high as nine figures.
If you file your whistleblower tip with an attorney, you can do so anonymously.
To put together an effective SEC tip requires deep knowledge of and experience working with the securities laws. As such, if you have information that you think may be actionable, a consultation with an attorney experienced with SEC whistleblower cases is a good next step.