5 Options for Immigrant Investors After (or Before) Denial of Removal of Conditions, Form I-829

Nov 14, 2023 | Immigration Updates, Investor Visas

By Attorneys: Bernard Wolfsdorf, Joseph “Joey” Barnett, and Jinglin “Kim” Sogbesan

A denial of removal of conditions on an EB-5 case usually occurs because the jobs were not created. However a denial can also occur because of the source or path of funds, fraud, or misrepresentation.  I-829 denials are a daunting setback for EB-5 investors because the applicant and their family have usually been settled in the US for many years.  The good news is that such denials are not the end of the road but a time to chart a new course to full permanent residency. Several options are available to EB-5 investors after the denial of an I-829, including administrative review and federal judicial review. In addition, EB-5 investors can also file a new EB-5 petition based on a new investment.   Further, where a case is clearly defective, it may be advisable to not file the I-829, surrender the conditional status, and pursue other options. Sometimes even nonimmigrant options can work, such as an O-1 or H-1B.   

Applicants with denied or deficient I-829s have a variety of options and should review all viable strategies. This article evaluates options and highlights challenges EB-5 investors will face in such situations. 

Understanding the Legal Consequences of an I-829 Denial

An EB-5 investor whose I-829 has been denied has no right to appeal the denial to the Administrative Appeals Office. Legal options prior to the issuance of a Notice to Appear (NTA) that commences removal proceedings include both administrative review and federal judicial review. Administrative review can be initiated by a motion to reopen or reconsider filed with USCIS.  Federal judicial review involves challenging the I-829 denial in federal court, which can sometimes trigger the issuance of an NTA.  Finally, an investor can seek new or de novo review of the denial during removal proceedings, but this must be initiated by USCIS or ICE and can take years. It is advisable to consult with an experienced EB-5 attorney to understand the best option based on the circumstances of the investor and his/her family.

Conditional Lawful Permanent Resident Status of I-829 Petitioner and Dependents

Conditional lawful permanent residents retain their permanent residency up until the entry of a final administrative order (by an Immigration Judge) ordering them removed from the United States, or, if the resident has appealed the Immigration Judge’s decision, the entry of a final decision by the Board of Immigration Appeals.    

The USCIS Policy Manual clearly states that an immigrant investor whose I-829 has been denied may seek review of the denial in removal proceedings. The standard procedure is for USCIS to issue a temporary Form I-551 stamp until an order of removal becomes administratively final. An order of removal is administratively final if the decision is not appealed or, if appealed, when the appeal is dismissed by the Board of Immigration Appeals. 

Unfortunately, the USCIS Policy Manual is inconsistent with the DHS regulations, which misstate that permanent residency is terminated upon denial of the I-829.  See 8 CFR § 216.6(d)(2).    This has caused problems for some with I-829 denials, including issues with U.S. Customs and Border Patrol upon re-entry, even where the person has a valid Form I-551 temporary green card stamp.

Accrual of Unlawful Presence

Removal proceedings begin when the Department of Homeland Security files a Notice to Appear with the immigration court after it is served on the investor.   Although the I-829 regulations require USCIS to issue the NTA upon denial of the I-829 petition, USCIS has not consistently complied with this. This is due to massive and growing backlogs of cases in the immigration court system. The result is USCIS could take years to issue the NTA to initiate the removal proceedings procedure, and years more to schedule a hearing. This leaves the investors in limbo and can trigger complex unlawful presence accrual issues. Fortunately, USCIS’s current policy is to extend the conditional resident status of the I-829 petitioner and accompanying dependents by issuing temporary Form I-551 stamps until an order of removal becomes administratively final. These stamps serve as evidence of the investor’s continued conditional resident status, thereby mitigating the harm to the investor and dependents regarding accruing unlawful presence. The I-829 applicant and accompanying dependents should be deemed not to accrue unlawful presence unless the Immigration Judge affirms the termination during removal proceedings. 

New EB-5 Investment or Employment-Based I-140 Sponsorship 

Any new investment must comply with the regulations in the March 2022 EB-5 Reform and Integrity Act (RIA), including the new source of funds documentation requirements, but could be a path to a new green card.  However, in this situation, the EB-5 investor with a pending I-829 must first abandon the current conditional lawful permanent resident status in order to obtain new conditional green card status based on the new I-526E petition. This is done by submitting Form I-407 to USCIS or at a U.S. port of entry.  For employment-based classifications, an investor with a denied I-829 obtains permanent residency through consular processing abroad. This complex strategizing must be done with an experienced immigration attorney. 

Family and Other Options 

  Some family-based applicants, such as those marrying a U.S. citizen, whose conditional permanent residency has been terminated, may be able to adjust in the U.S. based on Matter of Stockwell, 20 I&N Dec. 309 (BIA 1991). The USCIS Policy Manual states that “. . . it is not necessary that an immigration judge have affirmed USCIS’ decision to terminate the alien’s CPR status before the alien may file a new adjustment application.” USCIS Policy Manual, Vol. 7, Pt. B, Ch. 7(G). If the family relationship is lawful and bona fide, and a visa available, the applicant may be able to adjust in the U.S., although this argument is stronger if the I-829 is not filed and the person’s status is allowed to expire.   

In addition to family petitions, there may be I-360 special immigrant options for abused spouse VAWA victims, asylum or withholding of removal, and LPR cancellation of removal.  

Disclaimer: The information provided in this article is for general informational purposes only and is not intended to be legal advice. Immigration law is complex and constantly changing, and the information provided may not apply to your specific situation. You should not rely on this information as a substitute for seeking the advice of an immigration attorney or other qualified legal professional. If you have an immigration issue, you should consult with an attorney who can provide you with legal advice based on your particular circumstances. To schedule a consultation with WR Immigration, you can reach out to WR Immigration.

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