A settlement has been reached in the largest alleged fraud case in Vermont history.
Financial firm Raymond James Financial has agreed to pay $150 million dollars in its role in the alleged EB-5 fraud scandal, which erupted in April 2016.
“This news shocked the state and had devastating impacts on the Northeast Kingdom community,” says Governor Phil Scott.
Then Democratic Governor Peter Shumlin was in office when the US Securities and Exchange Commission filed fraud charges against Jay Peak owner Ariel Quiros and resort President Bill Stenger for allegedly misusing investor funds totaling $200 million,
“Hundreds of investors and businesses were owed money,” says Gov. Scott at a press conference Thursday evening.
Exactly one year later the company that’s accused of helping the businessmen do this, financial firm Raymond James Financial, is paying up.
“They stepped up to the plate, they faced their responsibility, they basically set an example of how firms caught in this situation should react,” says Jay Peak Receiver,
The firm agreed to a $150 million settlement that includes $4.5 million the company agreed to pay in June 2016.
The Governor says the settlement money will be used to pay back 42 contractors, 513 creditors and 169 project investors.
Governor Scott also said additional funds from this settlement will go towards continued development in the Northeast Kingdom.
“$17.5 million will be used to complete cottages, a recreational center and field as part of the state side of the hotel at Jay Peak.”
Gov. Scott says contractors and creditors should get their cash earnings in 60 to 90 days, which he says will put the resort back on track for a new owner and a bright future.
“By paying back those creditors and investors with this settlement will also put the resort in a better position for a future sale, which will be another step forward for the Northeast Kingdom.”
The Republican says there is still more work to be done to seek justice in this case, including several lawsuits that are still pending.