Nice v. Turnage
752 F.2d 431 (1985)
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Rule of Law:
Under 8 U.S.C. § 1101(a)(15)(E)(ii), the Immigration and Naturalization Service (INS) has the authority to require an E-2 Treaty Investor visa applicant to prove the source of their investment funds to ensure the capital belongs to the applicant and is personally at risk.
Facts:
- Anthony J. Nice, a foreign national, sought to change his visa status from a 'B-1 Visitor for Business' to an 'E-2 Treaty Investor'.
- To support his application, Nice presented evidence of an investment he made in a car wash.
- The primary proof of this investment was a $25,000 check drawn on a foreign bank.
- The check was signed by Nice's wife, who claimed to be acting under a power of attorney.
- Immigration officials noted irregularities surrounding the check, including a lack of proof regarding the principal who issued the power of attorney.
- Officials suspected the investment was actually made by Nice's father-in-law, not by Nice himself.
Procedural Posture:
- The Immigration and Naturalization Service (INS) denied Anthony J. Nice's application for a change of visa status to E-2 Treaty Investor.
- Anthony J. Nice and Yasmin Nice filed a lawsuit in the U.S. District Court for the Western District of Washington, challenging the INS's decision.
- The U.S. District Court (trial court) ruled in favor of the INS.
- The Nices (Plaintiffs-Appellants) appealed the district court's judgment to the United States Court of Appeals for the Ninth Circuit.
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Issue:
Does the Immigration and Naturalization Service have the authority under 8 U.S.C. § 1101(a)(15)(E)(ii) to require an E-2 Treaty Investor visa applicant to prove the source of the investment funds to show that the funds are their own risk capital?
Opinions:
Majority - Per Curiam
Yes. The INS has the authority to require proof of the source of funds because the statute requires the applicant to show 'he has invested' the capital. The court rejected Nice's argument that the source of funds is only relevant to prevent a 'sham investment,' finding the legislative history he cited unpersuasive. The court reasoned that allowing an applicant to merely show 'possession and control' of funds would permit 'wholesale evasion of immigration quotas' by enabling individuals to act as a 'front' for investments made by third parties. Therefore, to uphold the integrity of the treaty investor provision, the INS can properly require proof that the applicant's own capital is personally at risk.
Analysis:
This decision solidifies the authority of immigration agencies to scrutinize the financial origins of investments supporting E-2 visa applications. It clarifies that the statutory requirement that an applicant 'has invested' capital means more than just demonstrating control over funds; it requires proof of personal ownership and risk. The ruling establishes a significant precedent that places a clear burden on E-2 applicants to provide a transparent and verifiable chain of funds, thereby strengthening the government's ability to prevent immigration fraud through the use of front investors.
