New USCIS Policy Memorandum – Implications for EB-5 Adjustment of Status Applicants

On May 22, 2026, U.S. Citizenship and Immigration Services (USCIS) issued a new policy memorandum addressing how officers should exercise discretion in adjustment of status (AOS) adjudications. The agency simultaneously released public statements emphasizing that immigrant visa processing abroad should be viewed as the preferred route to permanent residence, while adjustment of status inside the United States should be treated as a discretionary alternative.

The announcement immediately generated concern among EB-5 investors, employers, and immigration practitioners because it appeared to signal a significant shift away from long-standing adjustment adjudication practices.

Importantly, however, the memorandum does not eliminate adjustment of status, prohibit concurrent filing, or require EB-5 investors to pursue immigrant visa processing abroad. USCIS has since clarified that applicants whose cases provide “an economic benefit or otherwise are in the national interest will likely be able to continue on their current path,” suggesting that employment-based adjustment adjudications, including EB-5 filings, are expected to continue under the new framework.

For EB-5 investors already in the United States, particularly those pursuing concurrent filing strategies, the memorandum appears less like a categorical bar and more like a shift toward heightened discretionary scrutiny. The policy is likely to increase USCIS focus on applicants’ immigration history, maintenance of status, intent at entry, and whether consular processing was available as an alternative to adjustment of status.

What the Memorandum Actually Changes
Initial USCIS press statements suggested a far broader policy change than the memorandum itself appears to support. USCIS spokesperson Zach Kahler stated that individuals temporarily present in the United States who seek permanent residence generally “must return to their home country to apply, except in extraordinary circumstances.”

That language, however, does not appear in the memorandum itself.

The operative guidance instead directs officers to consider the availability of consular processing as part of the discretionary analysis in adjustment cases. Specifically, the memorandum instructs officers to consider prior court and Board of Immigration Appeals decisions describing adjustment of status as an “extraordinary discretionary relief” and an “act of administrative grace.”

The statutory framework governing adjustment eligibility under INA § 245 remains unchanged. Applicants who are otherwise eligible to file adjustment applications inside the United States may still do so, including through concurrent filing where permitted by statute and visa availability.

What the memorandum changes is the framework through which USCIS officers are instructed to evaluate discretion.

Why This Matters for EB-5 Investors
The EB-5 program has become an increasingly attractive option for foreign nationals already living, studying, or working in the United States. Since the introduction of EB-5 concurrent filing under the EB-5 Reform and Integrity Act, many investors in lawful nonimmigrant status have pursued Forms I-526E and I-485 simultaneously in order to remain in the United States while their immigrant petitions are pending.

The new memorandum does not eliminate that pathway. USCIS has not instructed officers to deny EB-5 adjustment applications outright, nor has the agency rescinded concurrent filing eligibility.

What appears to have changed is the level of scrutiny applied to discretionary factors surrounding adjustment.

In practice, EB-5 investors adjusting status from classifications such as F-1, B-1/B-2, E-2, TN, or O-1 may now face more searching review regarding:

• Whether nonimmigrant status was properly maintained;
• Whether the applicant intended to immigrate at the time of admission;
• Whether the applicant complied with the terms of prior visa classifications;
• Whether consular processing was a viable alternative; and
• Whether sufficient positive equities exist to warrant favorable discretion.

Investor who maintained lawful status carefully, complied with visa requirements, and can document strong equities remain well positioned. However, applicants with gaps in status, employment irregularities, prior immigration violations, or questionable timing surrounding entry and filing may encounter greater adjudicatory difficulty than under prior practice.

A Shift in Discretionary Analysis
Historically, USCIS officers exercising discretion in adjustment cases generally followed long-standing agency and Board of Immigration Appeals precedent recognizing that favorable discretion ordinarily should be exercised where applicants established statutory eligibility and did not present significant adverse factors such as fraud, criminal conduct, or serious immigration violations.

The new memorandum signals a broader and potentially more restrictive discretionary review process.

USCIS now directs officers to conduct a more expansive review of the applicant’s immigration history, including:

• Compliance with the terms of prior nonimmigrant admissions;
• Whether the applicant engaged in conduct inconsistent with the purpose of admission;
• Whether the applicant maintained lawful status;
• Whether the applicant departed the United States when expected; and
• Whether consular processing was available as an alternative to adjustment of status.

The memorandum also emphasizes that temporary visas are intended for limited-duration stays tied to a specific purpose and suggests that nonimmigrant status should not function as a routine pathway toward permanent residence.

Increased Scrutiny of Intent at Entry
One of the most significant practical implications for EB-5 investors may be increased scrutiny regarding intent at the time of entry into the United States.

The memorandum revives analysis associated with Matter of Cavazos and similar cases focusing on whether applicants intended to immigrate when they entered on temporary visas.

This issue may be particularly relevant for investors who entered the United States in single-intent classifications such as F-1 student status, B-1/B-2 visitor status, TN status, or E-2 status and later pursued EB-5 adjustment through concurrent filing.

USCIS may increasingly examine:

• The timing of EB-5 investment activity;
• When the decision to pursue permanent residence was made;
• Whether circumstances materially changed after entry; and
• Whether the applicant’s conduct was consistent with the original purpose of admission.

Although pursuing permanent residence after entering in nonimmigrant status is not automatically improper, applicants should expect greater scrutiny regarding the development of immigrant intent during their stay in the United States.

Maintenance of Status May Become More Important
The memorandum also elevates compliance with the terms of nonimmigrant admission as a significant discretionary factor.

Under prior practice, many adjustment applicants allowed their underlying nonimmigrant status to lapse after filing Form I-485 and obtaining employment authorization and advance parole documents. The new guidance suggests USCIS may now treat failure to maintain status during the pendency of an adjustment application as a negative discretionary factor.

For EB-5 investors, maintaining underlying nonimmigrant status where possible may therefore become increasingly important, particularly for applicants in single-intent or short-duration visa categories.

The memorandum may also affect advance parole travel decisions, especially for applicants whose underlying nonimmigrant status has already expired.

What the Memorandum Does Not Do
Despite the significant attention surrounding the announcement, the memorandum does not:

• Eliminate EB-5 concurrent filing;
• Change statutory adjustment eligibility under INA § 245;
• Require denial of adjustment applications filed by EB-5 investors;
• Eliminate consular processing as an option; or
• Specifically target the EB-5 program.

For some investors, consular processing abroad may still prove strategically preferable depending on immigration history, travel plans, visa classification, and timing considerations. However, adjustment of status remains available for qualifying EB-5 applicants already present in the United States.

Looking Ahead
The full impact of the memorandum remains uncertain and will likely depend on how USCIS officers apply the guidance in practice. Additional agency guidance, administrative decisions, or litigation may further define the scope of the policy.

For EB-5 investors currently in the United States, careful case strategy and documentation will likely become increasingly important. Investors pursuing adjustment of status should consider proactively strengthening the discretionary aspects of their applications, including documentation relating to lawful status maintenance, tax compliance, employment or academic history, family ties, long-term residence, and other favorable equities.

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