Corruption, Politics, and an Immigration Investor Program Gone Awry

By Dan Cadman on May 1, 2015

My colleague, David North, has written capably and often about the scandal-plagued EB-5 immigration program, which provides alien resident status to individuals who are often mis-described as "entrepreneurs", but who in fact need only dump a half million dollars into an investment managed by a government-approved regional center to obtain that highly desirable commodity, a U.S. green card. (See, for instance, here.)

A half million dollars. That sounds like a lot, but really it's quite a bargain in today's global economy, especially if relatives pool together to do it. Highly irregular, almost certainly illegal, but who's to know, given the sloppy controls and "culture of yes" prevalent in the benefits granting agency, U.S. Citizenship and Immigration Services (USCIS) under this administration?

Among the world's wealthy, a half million dollars doesn't amount to much at all. In the main, what is more important to them is to make sure the "investment" gets steered into something that gets them what they really want — the resident alien card. So if they have to wheel-and-deal with suspect, but politically connected, middle men and dubious regional centers, it's just business as usual. After all, graft and politics go hand-in-hand in nearly every country on earth. Politicians seem drawn to money in the way that sharks are drawn to blood in the water: the merest scintilla of a scent brings them from miles away.

In one of his blogs, Mr. North noted that Brian Ross, investigative report for ABC, focused on corruption in the EB-5 program in a number of areas, one of which involves Senate minority (and former majority) leader Harry Reid weighing in on behalf of a dubious enterprise. While no criminal or even Senate ethics charges have been filed against Mr. Reid, one wonders whether he may be a tad worried, or whether the scrutiny now being levied has had any influence on his recent announcement that he will soon retire. Certainly others think so. (See here and here.)

But the corruption and influence peddling seem to have infected key leaders at the Department of Homeland Security (DHS), including the former head of USCIS Alejandro Mayorkas, who is now the DHS deputy secretary thanks to a promotion despite a slew of allegations that have dogged him. Following a sotto voce, but nonetheless damning, report by DHS Inspector General John Roth, the House of Representatives conducted a hearing on March 26 at which Roth testified. As I wrote earlier this month, Mayorkas appears to have gone out of his way to favor Anthony Rodham, the brother of Democratic presidential front-runner Hillary Clinton, in forcing a denial to turn into an approval in a case of such dubiousness (even by EB-5 standards) that it appears to have been a classic case of hammering a square peg into a round hole.

On April 13 of this year, ABC's Ross once again turned his eye toward the EB-5 program, focusing specifically on a boondoggle of epic proportions involving middle men at the regional center in New Orleans that swallowed up tens of millions of dollars in investments like a pig going down a python, with nothing to show for the project, which was supposed to create an all-inclusive vacation getaway, including swank hotel and spa, for the well-healed. (The New Orleans debacle was discussed in February of this year by Mr. North, but it appears things are heating up, as the FBI is now involved and the investors are actually complaining.)

Now here, in my view, is the most interesting part: Among those being investigated is Tim Milbrath, a retired colonel who was a military aide in the White House under the Clinton administration and who, along with other partners, appears to have played a major part in the bacon-eating python extravaganza down south.

So now you have four persons connected with the Democratic party and/or the Clintons who seem to have been lured by the promise of fast bucks and a sure "yes" from the guy in charge at USCIS: Harry Reid, Anthony Rodham, Tim Milbrath — and oh yes, Terry McAuliffe (Virginia governor, big-time Democratic rain-maker, and former head of the Democratic National Committee) and Ed Rendell (former governor of Pennsylvania). Did I forget to mention them before?

Lest you think this is purely a Democratic phenomenon — after all, influence peddling is influence peddling, and money is money, both apparently like rare earth magnets where politicos are concerned — let me just mention McAuliffe's mirror-image, Haley Barbour (ex-Mississippi governor, big-time Republican rain-maker, and former head of the Republican National Committee). Apparently he, too, knows easy money when he sees it.

Americans should be worried by these events, which it's important to note have not developed overnight. They have been allowed to fester. The EB-5 program has evolved beyond a badly run immigration program into a sleazy mire in which members of our political elite practically throw themselves bodily on the money scrum. This does not bode well for our republic. Does nobody remember Abscam?