Bank is Embroiled in EB-5 Visa Fraud Case

The EB-5 immigrant investor program has been in operation for more than a quarter of a century. However, a visa fraud cause in Vermont highlights why it remains controversial.

Recently, CT Post reported on how an alleged fraud involving a ski resort in Vermont has embroiled a bank which is facing possible legal action.

The scandal is linked to the EB-5 Immigrant Investor Program.

EB-5 visa fraud is probed in Vermont

CT Post reported the developers of Jay Peak, a ski resort in Vermont close to the Canadian border, have been accused of misusing in excess of $200 million in investor funds.

The U.S. Securities and Exchange Commission claims money was transferred from escrow accounts held at People’s United Bank into personal accounts.

The developers are accused of setting up a Ponzi scheme with funds obtained under the EB-5 Immigrant Investor Program.

We outlined the aims of the program in a recent blog.  The EB-5 program gives foreign investors an opportunity to obtain permanent residency in the U.S. if they create a certain amount of jobs and invest at least $500,000 in a rural area or one with high unemployment.

Over the course of about eight years, two men at the center of the investigation raised more than $350 million from investors for the Jay Peak ski resort project as well as a $110 million biomedical research center, according to the SEC.

Several of the foreign investors joined a class action lawsuit against the men and the banks involved, stated the Courthouse News Service. They accuse People’s United Bank of improperly managing the escrow accounts.

The SEC claims the actions of the defendants put the investors’ funds and their immigration petitions in jeopardy.

A recent report in The Atlantic said Congress is looking for a way to reform the EB-5 business investor program.

Chinese investors are the most sizeable group using the EB-5 visa program but concerns about visa fraud and the amount of jobs being created lingers.

At the same time, there is some evidence that the program is a successful way of bringing much-needed investment into some the most deprived parts of the United States.

Our Austin visa lawyers can advise you of the hurdles you will face in making an application and on which visa you should apply for. Contact us via this link.

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