Two New York lobbying groups are using their Democratic allies to block a bipartisan reform this month of the scandal-plagued, EB-5 citizenship-for-sale program, says Iowa Senator Chuck Grassley, the chairman of the Senate Judiciary Committee.

Grassley declared Monday:

The American people understand that our citizenship is a blessing, and shouldn’t be given away cheaply. Unfortunately, for too many years this body has witnessed the perversion and degradation of a program that sells, yes sells, our citizenship … in the last decade this program has been hijacked by big-moneyed New York City real estate interests. These developers now take almost all the foreign investment from this program, and for the last few years they’ve actively prevented this body from enacting any reforms … Today, I’m calling on the Majority Leader, the Minority Leader [Sen. Chuck Schumer], and all my colleagues who value the integrity of our lawful immigration system to stand with me and end the regional center program. The American people deserve better than this. Our citizenship means more than this.

The two business groups can block the reform from being added to the March 23 omnibus bill because they are backed by top Democrats — chiefly, Senate Minority Leader Chuck Schumer. The groups are the Real Estate Roundtable and Related Companies.

“Schumer is beholden to the New York real-estate interests which contribute to his campaign and he will not do anything they won’t sign on to,” said a Hill source.

The EB-5 program also allows Chinese government-run investors to effectively sell U.S. citizenship to their own spies, according to Grassley:

There’s no prohibition against foreign governments owning or operating regional centers or projects. That’s right, foreign governments can own businesses that sell our Citizenship. Think about that … There are no required background checks on anyone associated with a regional center. One need to look no further than the indictment last September of two Chinese fraudsters who stole more than $50 million in foreign investment and managed to sell U.S. citizenship to individuals on the Chinese government’s most wanted list.

Grassley has long led a campaign against abuse of the EB-5 program, an effort that took on a new dimension last summer when presidential son-in-law and White House Advisor Jared Kushner’s family business, now run by his sister Nicole Kushner Meyer, was caught using the program in their advertising to attract Chinese investors. Grassley later pushed for a fraud investigation into the practice, but the Kushner Companies were still reportedly using the EB-5 hook, along with “Mr. Perfect” Jared’s supposed White House clout, in China as late as July.

The current program allows foreign governments to sell U.S. citizenship to its friends, Grassley said.

There’s no prohibition against foreign governments owning or operating regional centers or projects. That’s right, foreign governments can own businesses that sell our citizenship. Think about that … There are no required background checks on anyone associated with a regional center. One need to look no further than the indictment last September of two Chinese fraudsters who stole more than $50 million in foreign investment and managed to sell U.S. citizenship to individuals on the Chinese government’s most wanted list.

Grassley continued:

I’m talking about the EB-5 Regional Center Program. For years, I’ve been fighting in a bipartisan way to reform this corrupt, scandal-clad program. I’ve been fighting to protect our national security, to ensure foreign investment is going to the most deserving areas, and to make sure that American citizenship isn’t sold at rock bottom prices in order to feed the addiction of New York interests to cheap money. But, no matter how hard I’ve fought, each and every time we’ve tried to reform this program these same moneyed interests have used their political influence and political connections to block any meaningful reforms. This is sickening, and it’s exactly why most American people question Washington, D.C. After more than three years of trying to fix this broken, scandal-plagued program, I’ve finally come to the conclusion that it can’t be fixed. And since it can’t be fixed, the EB-5 Regional Center Program needs to be terminated.

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The real-estate groups defend the program, which allows foreign investors to effectively buy green cards and citizenship for themselves and their families by investing only $500,000 in the United States. The program is mostly used by wealthy Chinese, most often by investing in new real-estate construction brokered by one of many EB-5 Regional Centers.

For example, if 100 Chinse investors unite to fund a real-estate program, they provide the developers with a $50 million fund to borrow construction loans that will be eventually repaid by the people who buy or rent the new buildings.

But the program is also used by corruption groups around the country. In South Dakota, for example, it was used to build an overpriced slaughterhouse that only produced a scandal.

Breitbart reported:

Ariel Quiros, the man behind the now infamous investment project in Vermont’s Jay Peak ski resort, had his assets frozen last year when it became clear he was effectively using the project to solicit investments from foreigners hoping for EB-5 green cards and then misusing the money, allegedly including $50 million for personal expenses. In January, a massive real estate investment fraud was unearthed in New York enticing foreigners, mostly Chinese, to invest in the hopes of securing EB-5 visas. Last month, raids were conducted in California in relation to another alleged $50 million investment fraud that attempted to get EB-5 visas for Chinese, including several of the most-wanted criminal fugitives in China. According to the China Daily, three of the 100 most-wanted public corruption and bribery fugitives, including one facing a potential death penalty, invested in the Los Angeles-area-based real estate scheme.

Grassley declared in his speech:

Several years ago, I started working with then-Ranking Member Leahy on reforms to the EB-5 Regional Center Program. Through the hard work and dedication of our staffers, we discovered the program is riddled with fraud and corruption, and poses a real and serious threat to our national security. Among other things, we discovered that: Investments can be spent before business plans are approved. Regional Center operators can charge excessive fees of foreign nationals in addition to their required investments. None of the jobs created have to be “direct” or verifiable jobs but rather are “indirect” and based on estimates or economic modeling. Again, not knowing for sure if jobs are created. Investment funds from foreign sources are not adequately vetted. Gifts and loans from anyone are acceptable sources of funds from foreign nationals. There’s no prohibition against foreign governments owning or operating regional centers or projects. That’s right, foreign governments can own businesses that sell our Citizenship. Think about that. Regional centers don’t have to certify that they comply with securities laws. There are no required background checks on anyone associated with a regional center. One need to look no further than the indictment last September of two Chinese fraudsters who stole more than $50 million in foreign investment and managed to sell U.S. citizenship to individuals on the Chinese government’s most wanted list. Gerrymandering continues and rural and urban distressed areas lose out. There’s no transparency on how funds are spent, who is paid, and what investors are told about the projects they invest in. And the list goes on and on and on. I could speak for hours about the corruption in this program. Faced with this appalling list of fraud, corruption, and national security loopholes, for three years I’ve been working with Senator Leahy and our counterparts in the House of Representatives to produce real EB-5 reform. Our staffers have spent countless hours, nights, and weekends meeting with congressional colleagues and industry stakeholders to hammer out a compromise that is fair to all sides. But our offers have constantly been rejected by big moneyed industry interests every single time. This time has been no different. For the last year, my staff, along with Chairman Goodlatte, Senator Cornyn, and Senator Flake’s teams, has worked around the clock to produce an EB-5 reform package. Everyone made numerous concessions in order to reach a deal, and after more than twenty meetings and countless hours of drafting, we produced a reform package that was fair. Our reforms would have reauthorized the Regional Center Program for six years, providing the certainty that industry has long said it craves. We would have permanently set aside 3,000 visas for rural and underserved urban areas, and would have increased the minimum investment amounts to $925,000. In recognition of longstanding industry concerns, we agreed to reduce the investment differential between non-priority areas and priority areas to a mere $100,000. Finally, we would have implemented a host of integrity measures that would have cracked down on investment fraud, foreign corruption, and bad business practices. Our reforms had the unanimous support of Invest in the USA, the largest EB-5 trade association. Our reforms had the support of the EB-5 Rural Alliance, a group working to ensure that rural America has a fair shake at attracting EB-5 money. But, these reforms weren’t acceptable to the big moneyed New York industry stakeholders who currently dominate the program. And because big money interests aren’t happy with these reforms, we’ve been told they won’t become law. Let that sink in for a minute. In spite of the fact that reforms were agreed to by Congressional offices and had the support of the largest EB-5 trade association, they won’t become law because a few EB-5 businesses with a lot of money have used their political connections and influence to block them. As I said at the beginning of this speech, I’ve finally realized this program cannot be reformed. The Regional Center program is simply too corrupted to be saved, and it needs to be ended. Today, I’m calling on the Majority Leader, the Minority Leader, and all my colleagues who value the integrity of our lawful immigration system to stand with me and end the regional center program. The American people deserve better than this. Our citizenship means more than this.

Ian Mason contributed to this piece.