The state of Vermont has agreed to pay $16.5 million to settle all pending and potential lawsuits from foreign investors in development projects at the Jay Peak resort, a ski area rocked by a massive fraud case that included its previous owner And presidentofficials said Wednesday.
In 2016, the state and federal Securities and Exchange Commission alleged that former Jay Beck owner Ariel Quiros and former chairman William Stinger had participated in a “massive eight-year fraud scheme”. The civil allegations involved misuse of more than $200 million of the nearly $400 million raised to develop various ski areas from foreign investors through a visa program. The EB-5 program encourages foreigners to invest in job creation projects in the United States in return for the opportunity to obtain permanent residence.
Quiros and Stenger settled civil charges with the SEC, with Quiros turning over more than $80 million in assets, including the two resorts.
In 2019, William Kelly, an advisor to Quiros, Stinger and Quiros, was indicted over the failed plan to build a biotech plant using tens of millions of dollars of foreign investor money. Kyros was sentenced last year to five years in prison; Stinger spent just over nine months in prison; William Kelly was sentenced to a year and a half in prison.
Foreign investors sued the state and Regional Immigrant Investor Centeraccusing her of not supervising the projects adequately.
The settlement announced Wednesday, if approved by the court, “will resolve all pending and potential lawsuits against the state that have been or could be filed by approximately 850 investors in Jay Peak EB-5 projects,” Attorney General Charity Clark said. In a press release. The state will also continue to support investors’ pursuit of green cards. If successful, Clark said the total settlement payment would be reduced by $4 million.
“As I’ve said before, Vermonts, investors, and the state of Vermont have all been deceived by Ariel Quiros, Bill Stinger, and William Kelly,” Clark added. “This civil settlement will result in a global resolution of the state’s involvement in this matter, which will protect the state from additional EB-5 lawsuits, preventing further financial harm to the state of Vermont.”
The $16.5 million will be paid out over three years into the Jay Peak Receivership, which will distribute the funds. Investors have paid more than $400 million to eight Jay Peak EB-5 projects.
Last month, the state agreed to pay $750,000 to settle the claims of eight Jay Peak investors.