Should Investors Only Consider EB-5 Projects with an I-956F Approval?
As awareness of the EB-5 Reform and Integrity Act (RIA) has grown, many investors have begun focusing on one particular milestone when evaluating projects: the I-956F approval.
Some investors go so far as to eliminate any project that has not yet received an I-956F approval from consideration.
While this approach may seem logical at first glance, it can cause investors to overlook other factors that may be equally—or even more—important when evaluating project risk.
The reality is that an I-956F approval is an important piece of information, but it should be viewed as one component of a broader due diligence process rather than the sole determining factor in selecting an EB-5 investment.
What Is an I-956F Approval?
Form I-956F is the application submitted to USCIS for approval of a specific EB-5 project.
The filing typically includes information regarding:
- The project and business plan
- The capital structure
- Job creation methodology
- Economic impact analysis
- Offering documents
- Compliance with EB-5 program requirements
When USCIS approves a Form I-956F, the agency has reviewed the submission and determined that it satisfies applicable EB-5 program requirements based on the information provided.
This is unquestionably a positive milestone for any EB-5 project.
However, investors should understand both what an I-956F approval does—and does not—represent.
What an I-956F Approval Does Not Tell You
An I-956F approval is not an endorsement of the project’s investment quality.
USCIS is not evaluating questions such as:
- Whether the project is financially attractive
- Whether the developer has a strong track record
- Whether the project is likely to be completed on time
- Whether investors will receive a return of capital
- Whether the market assumptions are realistic
- Whether the collateral is strong
- Whether the exit strategy is prudent
Those are investment due diligence questions, not immigration compliance questions.
A project can receive an I-956F approval and still present significant business or financial risks. In some cases, those business risks can ultimately create immigration risks as well. For example, if a project is not completed, fails to create the required jobs, or encounters severe financial distress, investors may face challenges in satisfying certain EB-5 program requirements. While an I-956F approval confirms that USCIS has approved the project’s EB-5 structure and documentation, it does not guarantee successful project execution or eliminate the importance of evaluating the project’s underlying business fundamentals.
Likewise, a project may have exceptional fundamentals and still be awaiting USCIS adjudication.
Who Prepared the Filing?
When evaluating an EB-5 project, investors often focus on whether an I-956F approval has been issued. An equally important question is:
Who prepared the filing?
An I-956F submission is the product of a team of professionals that typically includes immigration counsel, securities attorneys, economists, business plan writers, and other EB-5 specialists. The quality and experience of that team can have a significant impact on the strength of the filing and the likelihood that potential issues are identified and addressed before submission.
Investors may want to ask:
- Who prepared the I-956F application?
- Which law firm handled the immigration aspects of the filing?
- Who prepared the economic impact analysis?
- Which securities counsel structured the offering documents?
- How extensive is the team’s EB-5 experience?
Experienced EB-5 professionals often have substantial reputational capital at stake. Firms that have spent decades building credibility within the industry are typically selective about the projects they choose to represent and the filings they submit. Their reputations are built on years of successful work and can be damaged by repeatedly associating themselves with poorly conceived or weak projects.
Just as investors evaluate the experience of a developer, they should also evaluate the experience of the professionals responsible for preparing the project’s EB-5 documentation.
For example, Paragon works with some of the most experienced professionals in the EB-5 industry, including Saul Ewing for securities counsel, KLDP for immigration counsel, and Baker Tilly for economic analysis. These firms have collectively participated in hundreds of EB-5 matters and are widely recognized for their experience in the EB-5 program.
While no professional team can guarantee an approval outcome, the quality and experience of the filing team are important factors that investors should consider when evaluating any EB-5 project.
The Risk of Using a Single Screening Criterion
Investors naturally look for ways to reduce uncertainty.
The challenge is that complex investment decisions rarely have a single indicator that can determine whether a project is a good opportunity.
Consider two hypothetical projects:
Project A has received an I-956F approval but is sponsored by an inexperienced developer, has a thin job creation cushion, limited collateral, and relies on aggressive financial projections.
Project B is sponsored by an experienced developer, has substantial collateral, meaningful developer equity, a strong job creation cushion, and a clearly defined exit strategy, but its I-956F approval remains pending.
Would it automatically make sense to choose Project A?
Most sophisticated investors would likely say no.
The answer requires evaluating the entire investment opportunity, not simply checking a single regulatory box.
Why Many Strong Projects May Still Be Awaiting Approval
The timing of an I-956F approval is not always a reflection of project quality.
A variety of factors can influence approval timing, including:
- USCIS processing workloads
- Filing dates
- Requests for additional information
- Administrative review timelines
- Agency prioritization
As a result, investors may encounter high-quality projects that are still awaiting adjudication despite having strong fundamentals.
In many cases, the question is not whether the project will ultimately receive approval, but when USCIS will complete its review.
The Opportunity Cost of Waiting
One factor investors often overlook is the timing of the I-956F process itself.
Preparing a high-quality I-956F filing is a substantial undertaking that typically involves months of work by immigration counsel, securities attorneys, economists, business plan writers, and the project sponsor. Once submitted, the filing then enters the USCIS review process.
As a result, there can often be a significant period between the launch of a project and the issuance of an I-956F approval.
During that time, investors must decide whether they are willing to evaluate the project based on its merits or whether they will wait for the formal approval.
The challenge is that highly sought-after projects do not necessarily remain available until approval is received.
In many cases, projects with experienced developers, strong market fundamentals, substantial collateral, meaningful developer equity, and well-known EB-5 professionals attract investors long before USCIS completes its review.
As a result, investors who limit themselves exclusively to approved projects may find that some of the strongest opportunities have already completed their fundraising.
At Paragon, this has been our experience. To date, every I-956F filing sponsored by Paragon has ultimately received approval. However, because our projects are typically supported by experienced development teams, strong underlying fundamentals, and leading EB-5 professionals, investor subscriptions have generally been completed before the I-956F approval was issued.
This does not mean investors should ignore approval status. Rather, it highlights the importance of evaluating the entire opportunity. Investors who wait exclusively for an approval may reduce one source of uncertainty, but they may also limit their access to projects that have already been thoroughly vetted by experienced developers, lenders, attorneys, economists, and other market participants.
What the Approval Statistics Tell Us
Many investors assume that a project without an I-956F approval carries a significantly higher immigration risk.
However, publicly available USCIS data suggests that post-RIA I-526E petition approval rates have generally remained very strong, with denial rates representing only a small percentage of total adjudications.
While every petition is unique and future outcomes can never be guaranteed, the available data does not support the idea that investors should automatically dismiss projects solely because an I-956F approval has not yet been issued.
Instead, investors should focus on whether the project has been structured properly, supported by credible economic analysis, prepared by experienced professionals, and designed to meet EB-5 requirements.
A Better Approach to Due Diligence
Rather than treating I-956F approval as the only factor that matters, investors should evaluate projects using a broader framework.
Questions may include:
- Does the project have a strong job creation cushion?
- Is the developer experienced?
- Is there meaningful developer equity?
- Is the business plan understandable?
- Is there demonstrated market demand?
- Is the collateral strong?
- Is the exit strategy realistic?
- Who prepared the filing?
- How does the project’s overall risk profile compare to alternatives?
An I-956F approval should absolutely be part of that analysis.
It simply should not be the entire analysis.
Final Thoughts
I-956F approvals provide important information and may offer investors additional confidence that a project’s EB-5 documentation has been reviewed by USCIS.
However, no approval can replace careful investment due diligence.
At Paragon, we view I-956F approval as an important milestone, but not a substitute for evaluating the underlying investment. We are proud that every I-956F filing sponsored by Paragon has been approved to date, a record we believe reflects our commitment to partnering with experienced developers and working with some of the most respected legal, economic, and securities professionals in the EB-5 industry.
Ultimately, the strongest EB-5 projects are identified not by a single approval status, but by a combination of sound immigration fundamentals, strong project economics, experienced sponsorship, prudent risk management, and a well-prepared filing team.
Investors should view I-956F approval as one important factor among many when making an investment decision—not as a substitute for a comprehensive evaluation of the project itself.
