A Double-Header on Investor Visa Fraud

By David North on November 28, 2022

We usually see finance-related immigration fraud as exploiting a single part of the immigration system, but now there are RICO charges in a federal court saying that one allegedly shady operator had a scheme that could operate in either the E-2 (treaty trader) or the EB-5 (immigrant investor) arenas. 

The offer – of creating a truck-liner service – at one level could lead to a nonimmigrant (E-2) visa, or set of them, and at higher level to a set of EB-5 immigrant visas. Or it could simply be an “investment” with no immigration overtones. The business was to be a service which provided the laying on of a so-called environmentally-friendly truck liner to what sound like dump trucks, but according to one victim it was just a misleading ruse to separate the investor from his or her money.

The charges were filed in the U.S. court of the southern district of Texas under the Racketeer Influenced and Corrupt Organizations Act. It was the subject of a Law360 report.

As is so often the case, both the victim and the villain were of the same ethnicity, in this case the victim was named Bustos who charged two people named Martinez and Hernandez. That the scheme could be used in both E-2 and EB-5 cases is not explicitly reported in the Law360 coverage, you have to read the complaint in the PACER files to learn that; the PACER file number is 4-22-cv-02690.

In this case Cesar Bustos, who is identified as a Mexican national, was not interested in the potential immigration aspects of it, he regarded it as a pure (and later not-so pure) investment. He sunk $175,000 into it, which could have bought him an E-2 visa, but not an EB-5 one.

Bustos, according to the article, said that the offer had been advertised in Mexico, Taiwan, and Vietnam as “a path to U.S. citizenship.” The trial continues.

Chicago’s Carillon Tower Project. One of the joys of being a critic of the EB-5 program for immigrant investors is that, because of legal maneuvers, a single EB-5 scandal hits the news again and again, in the all too many cases in which the crooked middlemen drag out the repayment process once they have lost in court.

An excellent example of this is the $50 million or so Carillon Tower Project which was to build a retail/housing complex on Chicago’s Lake Michigan coast, which we have written about from time to time, here and here.

The judge ruled that a $27.5 million consent agreement between the aggrieved Chinese investors and the developers was appropriate and set some deadlines for partial payments. One such payment could not be made on time, the developers said, because of an eight-day-long religious holiday in the Middle East slowed the movement of a loan. More recently, as Law360 reported, a $100,000 payment was not paid in full, in fact only $20,000 changed hands. Whether that Middle Eastern loan really exists or not is one of the mysteries in this case.

Every time one of these events happens the media reminds us of yet another EB-5 project that failed; in this case the investors may get some money back, but not the green cards they had sought.