Kushners tap China’s $24B ‘golden visa’ market
Trump family’s ties to controversial EB-5 program raise complaints about conflicts of interest, calls to revise rules
When the sister of President Donald Trump’s son-in-law Jared Kushner promoted investment in her family’s new skyscraper from a Beijing hotel ballroom stage earlier this month, she was pitching a controversial American visa program that’s proven irresistible to tens of thousands of Chinese.
More than 100,000 Chinese have poured at least $24 billion in the last decade into “golden visa” programs across the world that offer residence in exchange for investment, an Associated Press analysis has found. Nowhere is Chinese demand greater than in the United States, which has taken in at least $7.7 billion and issued more than 40,000 visas to Chinese investors and their families in the past decade, the AP found.
The Chinese investors flocking to these programs are people like Jenny Liu, a doctoral student in the eastern city of Nanjing, who sold her apartment two years ago and moved in with her parents. She used the money from the sale to invest $500,000 in a hotel project in the United States. If the project creates enough jobs in two years, she’ll get a prized “green card” and a pathway for a less stressful education for her 9-year-old son.
“My son has a lot of homework to do every day, but I don’t think he has learned a lot from school,” Liu said. “I hope he can actually pick up some useful knowledge or skills rather than only learn how to pass tests.”
The flood of investors reflects how China’s rise has catapulted tens of millions of families into the middle class. But at the same time, it shows how these families are increasingly becoming restless as cities remain choked by smog, home prices multiply and schools impose ever-greater pressure on children. They also feel insecure about being able to protect their property and savings.
Their money goes toward government bonds, businesses, mountain ski resorts, schools and real estate projects, including a Trump-branded tower in New Jersey built by the Kushner Companies, once run by Jared Kushner, now a White House senior adviser. But the industry is murky, loosely regulated and sometimes fraud-ridden — in the U.S., federal regulators have linked the EB-5 visa program to fraud cases involving more than $1 billion in investment in the last four years.
Despite criticism from Congress, Trump signed a spending bill that included a renewal of the program through September, although federal authorities have proposed more than doubling the minimum investment. Just one day later, Kushner’s sister, Nicole Meyer, was in Beijing courting Chinese for a new project funded by EB-5. That’s raised complaints about conflicts of interest and new calls to revise or even end the program, which ives green cards to anyone who invests $500,000 in a business that creates or saves at least 10 jobs.
Wooing Chinese investors
China is central to the success of almost every major investment migration program in the world, so many countries are going out of their way to court Chinese investors.
Ads for investment programs pop up on Chinese cellphones and websites, full of promise and intrigue. In crowded hotel ballrooms, foreign officials with pamphlets and flashy presentations tout the same message: Start a new life in a country with better education, clean air and a stable future.
Agents selling U.S. projects to Chinese take great pains to prove their expertise on the states, the EB-5 program and perceived ties to American leaders. Some marketing materials include photos of Chinese posing with former President Barack Obama.
Now, they’re competing directly against the current president’s relatives.
Meyer, Kushner’s sister, appeared this month at events in Beijing and Shanghai to promote One Journal Square, a New Jersey tower project planned by the Kushner family that would be partially funded through EB-5 investment. The presentation included a photo of Trump and vague promises that the project had “government support” and was “founded by celebrity developers.” The company later apologized for any implication that her brother was supporting the project, and Meyer pulled out of a presentation to Chinese investors scheduled for this past weekend.
Trump’s name already appears on another New Jersey residential tower, Trump Bay Street, built with the help of EB-5 funding. And one month before the November election, an ad appeared on a Chinese website for a new project: “A 200 million dollar hotel developed by The Trump Organization in Austin.” An online brochure described Trump as the “king of real estate.”
White House press secretary Sean Spicer this month said Kushner would follow government policies on potential conflicts of interest, and that Trump and Congress would review “all the various visa programs and whether or not they are serving the purpose that they were intended to.”
Slowing the flow
There are signs China is trying to slow down the migration.
Articles critical of investment visa programs have appeared in China’s state media, often highlighting fraud cases or stories of Chinese who faced trouble after going abroad. China has also tightened controls on how much money individuals and companies can move out of the country as part of broader efforts to stop the currency from further weakening.
Banks are expected to enforce more strictly the yearly limit of $50,000 that individuals are allowed to take out of the country, and will be required to report any transfers above $10,000. Still, Chinese have typically worked around such controls by slowly moving money or using friends and family members to help them amass an overseas account.
If China can’t keep entrepreneurs and middleclass families from leaving, it risks endangering its economic future. That includes people like Joey, a 30-year-old Beijing resident who works for a major Chinese state-owned conglomerate. He shared his story on the condition that his last name not be used because he hadn’t told his employer of his plans.
Joey and his fiancée have a two-bedroom apartment and plan to get married and have a child in China. But they want to raise that child elsewhere. His friends and relatives helped him move enough money offshore to invest in the American EB-5 program.
Joey says he’s seen parents and children struggling to breathe outside in China’s smoggy air, and signs that China’s economy is headed for deeper trouble.
“In China, you have to plan ahead,” Joey said. “You cannot just leave today, whenever you want. You never know what happens next.”