Money and structure

Zhang v. USCIS

Also called Zhang, Huashan Zhang v. USCIS, Zhang case.

Zhang v. USCIS is the class litigation that ended USCIS treating an EB-5 investor's invested loan proceeds as indebtedness requiring collateral: the district court set the denials aside on 30 November 2018 and the D.C. Circuit affirmed on 27 October 2020, holding that cash in 8 CFR 204.6(e) includes the proceeds of third party loans.

What it decides

Huashan Zhang and Masayuki Hagiwara each borrowed 500,000 dollars from a corporation they controlled and invested the cash, and USCIS denied both petitions under the collateralization test it announced at a telephonic stakeholder engagement on 22 April 2015. Judge Emmet Sullivan held 8 CFR 204.6(e) unambiguous, found nothing in the ordinary meaning of cash that excludes the cash proceeds of a loan, vacated the denials and certified a class of all I-526 petitioners denied solely on that ground, reported at 344 F. Supp. 3d 32. He also held the 2015 position to be a legislative rule adopted without notice and comment, but the D.C. Circuit expressly declined to decide that question and affirmed on plain meaning alone, reading the class as excluding petitions denied before 23 June 2009 as time barred. USCIS records 30 November 2018 as the date it stopped applying the interpretation.

Governed by Huashan Zhang v. USCIS, No. 15-cv-995 (EGS), memorandum opinion filed 30 November 2018, reported at 344 F. Supp. 3d 32 (D.D.C. 2018), affirmed in Huashan Zhang v. USCIS, No. 19-5021, 978 F.3d 1314 (D.C. Cir. 27 October 2020) (Katsas, Circuit Judge); 8 CFR 204.6(e); USCIS Policy Manual, 6 USCIS-PM G.2(A)(1) footnote 14, page current as of 5 August 2026, which supplies the 30 November 2018 date but cites the appellate reporter for the district court decision and so is not a reliable source for the citation itself.

Where this is explained properly

Pages here that go into zhang v. uscis rather than mentioning it.

Using Gifted or Loaned Funds for EB-5: What’s Allowed and What’s Not

Related terms

CapitalCapital is the cash and tangible assets an EB-5 investor contributes to the new commercial enterprise. Two texts define it: the statute, which governs petitions filed on or after 15 March 2022, and the older regulation, whose conditions on debt USCIS still applies alongside the statute.
Secured indebtednessDebt that the investor is personally and primarily liable for and that is secured by the investor's own assets, which counts toward the EB-5 capital requirement only when the debt instrument itself is what goes into the enterprise, not when the investor contributes cash borrowed against those assets.
Unsecured loanAn unsecured loan is borrowing that pledges none of the investor's own assets, and its cash proceeds can fund an EB-5 investment: since Zhang v. USCIS the collateral test in 8 CFR 204.6(e) reaches only a debt instrument contributed to the enterprise, not lawfully obtained cash that the investor happens to have borrowed.
Borrowed fundsBorrowed funds are money an EB-5 investor is lent and then contributes as capital. Since Zhang v. USCIS, USCIS evaluates invested loan proceeds as a cash contribution, not indebtedness, so the loan need not be collateralized, but for petitions filed on or after 14 May 2022 the statute counts them only if the loan was made in good faith and not to circumvent the limits on permissible sources.

Checked against primary sources on 10 August 2026. Back to the glossary