A private venture that was supposed to spark an economic renaissance in northern Vermont has turned into what state and federal authorities are calling a “Ponzi-like” fraud on foreign investors, who have allegedly been duped out of tens of millions of dollars by the owner of Jay Peak.
An 81-page complaint unsealed by the Securities and Exchange Commission Thursday outlines a scheme in which Ariel Quiros, a Miami businessman, and owner of Jay Peak, “systematically looted” more than $50 million from foreign investors through the federal EB-5 program. Authorities say Jay Peak CEO Bill Stenger facilitated the fraud by funneling investor money to private accounts controlled by Quiros.
“We all feel betrayed,” Gov. Peter Shumlin said during an afternoon press conference. “It’s a dark day for Vermont.”
The EB-5 program offers a path to citizenship to immigrant investors willing to pour at least $500,000 into approved projects in economically depressed regions of the United States. Quiros and Stenger have used the program to generate $350 million in capital from more than 700 investors in 74 countries.
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