Federal Court Rules Against USCIS In Landmark EB-5 Case On Currency Exchanges

Executive Summary

• U.S. District Court Decision in Favor of EB-5 Investor: The court ruled that USCIS acted arbitrarily and capriciously by requiring an EB-5 investor to prove the lawful source of funds held by a third-party currency exchanger.
• Key Takeaway for Investors: EB-5 applicants may only need to demonstrate that they lawfully obtained their own capital—not the source of U.S. Dollars converted through currency swaps or third-party exchanges.
• Significant Impact on Investors from Restricted-Currency Countries: This is welcome news for applicants from China, India, Bangladesh, Vietnam, and Northern Africa, where money changers and informal exchange systems (such as hundi or hawala) are commonly used due to currency restrictions.