$ 45 million scam: California scammer stole money from applicants for an investment green card
A Silicon Valley entrepreneur will pay 50 million dollars for allegedly appropriating 45 million dollars of investments to those foreigners who planned to receive green cards in the USA with the help of the investment program EB-5.
As the Mercury News San Mateo County resident Bethany Liu agreed to pay 50 million dollars as part of a settlement for allegedly misappropriating at least 45 million dollars to foreign nationals who applied for US green cards through real estate investment in Cupertino,
Instead, the money went to accounts in Liu's name, according to the Securities and Exchange Commission notice of settlement. Liu did not admit that she had committed an offense.
The central place in this matter is occupied by the controversial EB-5 visa program, which allows foreign citizens to invest in US companies in exchange for permanent residents cards (green cards), which provide a path to citizenship. At that time, when investors transferred their money to Liu in 2016, to implement the program it was required to invest at least 1 million dollars in a new commercial enterprise creating or retaining at least 10 full-time jobs, or 500 000 dollars for enterprises in rural areas or areas of high unemployment that are considered “targeted”.
The EB-5 program was created in 1990 "to stimulate the US economy through job creation and investment," according to the SEC. In July, Presidential Administration Donald Trump raised the minimum investment to 1,8 million dollars and 900 thousand dollars and transferred the authority to designate high unemployment zones to the federal government from the state and local governments.
Senator Chuck Grassley, welcoming the changes that will take effect on November 21, said that the EB-5 program allowed us to identify areas with high unemployment in the interests of real estate “with big money”, so that “needy communities were absorbed in brilliant projects in the most prosperous quarters of America. "
In a consultative article explaining the EB-5 changes, the US Citizenship and Immigration Services says that manipulating the designation of “target employment area” is usually done by “clearing” censuses to link the “prosperous location of the project” to the “problem community”.
According to a lawsuit filed this summer by a group of Chinese investors accusing Liu of fraud, a woman took 500 000 dollars from each, allegedly putting money into the Cupertino Fund to pay for the development of the local real estate industry.
The Securities and Exchange Commission said the money from the Cupertino Foundation was to go towards "a mixed-use development of residential, commercial and hotel properties in Cupertino." But 55-year-old Liu transferred the investors' money into accounts in her own name and then “pledged those funds as collateral for a line of credit,” according to the SEC.
"Liu has never transferred investment funds to a project developer in Cupertino," the SEC notice says, which also clarifies that her handling of funds violates securities law by misleading investors through misleading statements or omission of material facts.
Under the terms of the agreement, Liu is due to pay $ 48 million within 10 days, with the balance due next year. The SEC said it "will seek to distribute the money among the investors of the Cupertino Foundation."
On the subject: Millions of dollars schemes: how scammers cheat US job seekers
A lawyer representing more than 20 investors suing Liu, who are at least 90 investors whose funds are in question in the settlement of the SEC, said the law firm will work with the SEC to expedite the return of money. The trial will continue as many questions remain unanswered, said attorney Julie Rogers of the Structural Law Group.
“We are looking for further damages, court records and full access to the books and records of the Cupertino Foundation,” she said.
“But I believe my clients' lifelong hopes of getting a green card and residency legally under a government-sanctioned program are forever shattered,” Rogers added.
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