It is getting to be a formula.
Yet another EB-5 promoter has swindled millions from alien investors, presumably her fellow Chinese, and used the money to buy a yacht and a $100,000 Mercedes among other things, and the Securities and Exchange Commission (not DHS) has broken the case.
This time the locale is Florida, the alleged swindler is Lily Zhong, and her purchases also include a summer home in Worcester, Mass., a winter one in Poinciana, Fla., and a $55,000 BMW X5 SUV, perhaps for travel between. SEC says that she defrauded 17 investors out of $8.5 million. Though the nationality of the investors was not revealed, about 85 percent of all EB-5 investors are from China.
According to an article in National Law Review, this was a multi-layered scam:
Based on the complaint, investors appear to have been represented by the same counsel that represented Zhong and her affiliated companies. This attorney, who is not referenced in the complaint, has owned three USCIS-designated regional centers in Florida. Contrary to the representations in the offering material, investors had absolutely no involvement in the management or decision-making.
One of the SEC charges is that there were "alleged omissions from offering documents about her being the subject of bankruptcy proceedings in New Zealand", suggesting the multi-national habits of some of the EB-5 promoters.
The SEC filed a civil action against EB5 Asset Manager and its owner, Ms. Zhong, in U.S. District Court of Central Florida on November 3; the case number is 0:15-cv-62323-JAL.