EB-5 Victims Win (Minor) Victory in Florida

By David North on September 8, 2021

The headline in the Law360 report on an EB-5 (immigrant investor) case in Florida on September 7 sounds very positive: “Chinese Investors, Fla. Firm Settle Visa Fraud Claims”.

But on closer examination, the win was a tiny, tiny one for the investors.

All of this relates to a long-running $50 million scandal in which a large number of investors, mostly from China but also from Iran and Turkey, placed funds (at half a million each) in a Palm Beach real estate project which never was built, and which we have been writing about for at least five years.

The promoters, Joseph Walsh Sr. and Jr., were said to have misused much of the money by, among other things, buying a 151-foot yacht, and their lawyer (of the “Fla. Firm”) Leslie Robert Evans, faces federal criminal charges in relation to the project.

The investors did not get the green cards they wanted; they have been awarded $646,000 each by the federal judge in the case, but how much of this will actually be paid is an open question. The most recent lawsuit was not about getting money from the Walshes, or their green cards; it was an effort to pry some money out of the law firm that aided the Walshes.

So, a minority of the investors (20 out of 100 or so) is getting some unknown fraction of what they sued for, and will pay a substantial fraction of that amount to their own lawyers, but no green cards and no major return on their investments, at least not yet. So a very small victory for some of the victims.

The main part of the EB-5 program remains dead, and has been for more than two months; that is the part that authorized the pooled investments like this one in Palm Beach.