Immigration Lawyers Received $25,000 Incentives From Jay Peak Leaders in EB-5 Scandal

HYDE PARK, Vt. - The first court hearing occurred Monday in a fraud case surrounding a Vermont ski resort.

An updated lawsuit filed Friday brought new allegations against the Vermont Regional Center, which oversees the state's EB-5 program. EB-5 is a federal program that offers permanent residency in the US to foreign investors who fund local development projects.

Inside the 92 page complaint, attorneys for five foreign investors claim their immigration lawyers received an incentive from the former leaders of Jay Peak Resort, to the tune of $25,000 per investor.

"They were paying an attorney that was actually supposed to be representing independently the investor and it was a plug and play contract," said Russell Barr, represents the five investors.

It's all part of a huge scandal that rocked the Northeast Kingdom last year. According to the complaint, several investors allege their money was misused by the resort's former owner Ariel Quiros, and former president and CEO Bill Stenger to build developments. Around $200 million was funneled through the Ponzi-like scheme, which investors claim the state of Vermont and several top officials supported.

Barr said, "Commit all this fraud, commit all this gross negligence, hurt all these people including all these folks in the Northeast Kingdom and then somehow suggest we are immune, no not in America."

The state claims it's immune from such charges.

"Security fraud claims cannot be asserted against the state, nor are any claims under federal or state securities law appropriate against individual employees,” explained Megan Shafritz, represents the state of Vermont.

Attorneys for the plaintiff argued in court Monday that the state, in no way shape or form should be entitled to immunity.

"I don't look at the complaint and the factual claims and say 'oh there is discretionary function going on here'... I see the Vermont Regional Center as a securities brokerage house in the market of securities, a completely proprietary function,” said Chandler Matson, represents investors.

The state plans to file a motion for dismissal on October 8th.

The US Citizenship and Immigration Services which oversees the EB-5 program is in the process of closing down the Vermont Regional Center, citing the failure of proper supervision involving the Jay Peak project.


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