Vermont lawmakers have reacted to allegations of fraud at EB-5 immigrant investor projects in the Northeast Kingdom by asking the state to codify rules that safeguard the program.
Federal and state officials filed lawsuits last week alleging that the two men leading development projects at and around Jay Peak Resort misused and misappropriated more than $200 million since 2008.
In a proposal drafted this week, the Senate Finance Committee directs state officials to formalize rules that would "prevent fraudulent activities" and strengthen oversight of development projects under the EB-5 program.
Most, if not all, of these regulations already exist under a 2014 agreement between the Agency of Commerce and Community Development and the Department of Financial Regulation, which jointly manage Vermont's EB-5 Regional Center.
Writing EB-5 state oversight into law — rather than leave it as an agreement that can change — could help to reassure EB-5 investors that their projects are being scrutinized, said Vermont Commerce Secretary Pat Moulton.
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