The panel affirmed the district court's summary judgment in favor of the U.S. Securities and Exchange Commission ("SEC") in its civil complaint filed against Hui Feng and his law firm, alleging securities fraud. 

The U.S. Immigrant Investor Program, also known as the EB-5 program, provides legal permanent residency in the United States to foreign nationals who invest in U.S.-based projects. Multiple foreign investors may pool their money in the same enterprise, and these pooled investments are made through "regional centers" which are regulated by the U.S. Citizenship and Immigration Services. 

Feng legally represented clients through the EB-5 process, and entered into marketing agreements with regional centers. The basis of the agreements between the regional centers and Feng's investors were known as private placement memoranda ("PPMs"). 

The panel agreed with the district court that the EB-5 investments in this case constituted "securities" in the form of investment contracts. The panel rejected Feng's argument that the transactions were not "securities" because his clients did not expect profits from their investments. Specifically, the panel held that the PPMs' identification of the investments as securities, the form of the investment entity as a limited partnership, and the promise of a fixed rate of return all indicated that the EB-5 transactions were securities. The panel rejected Feng's contention that the administrative fees upended the expectation of profits. The panel also rejected Feng's assertion that his clients lacked an expectation of profit because they were motivated to participate in the EB-5 program by the promise of visas, not by profit. 

Concerning the cause of action that Feng failed to register as a broker in violation of Section 15(a) of the Securities and Exchange Act of 1934, the panel agreed with the district court's conclusion that Feng was acting as a broker and violated the registration requirement. The panel held that the district court properly made its broker determination by utilizing the totality-of-the-circumstances approach by relying on the so-called Hansen factors. The panel rejected Feng's arguments that the broker registration requirement should not apply to his circumstances. 

The panel affirmed the district court's finding that Feng engaged in securities fraud in violation of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 based on two theories of fraud liability: material omissions, and schemes to defraud. Concerning material omissions, the panel held that where Feng worked as both a broker and an immigration attorney, he had fiduciary duties to his clients, including the obligation to disclose conflicts of interest. Here, there was a risk that Feng's judgment would be swayed by the promise of a commission from the regional center, and this presented a conflict with Feng's representation of a client, which he failed to disclose to his clients, and this failure was material. Concerning schemes to defraud, the panel affirmed the district court's findings that Feng defrauded the regional centers that refused to pay commissions to U.S.-based attorneys not registered as brokers, and defrauded clients who sought a reduction in their administrative fees. 

Finally, the panel held that the district court did not abuse its discretion in entering a disgorgement order. The district court calculated that Feng received $1.268 million for commissions in connection with the EB-5 program, and ordered disgorgement of the entire amount.