Judge approves $150-million settlement

copyright the Chronicle July 5, 201

 

by Joseph Gresser

 

U.S. District Court Judge Darrin Gayles cleared the way for contractors, merchants, and some EB-5 investors to recover money Jay Peak and Burke Mountain Resorts owes them.

On Friday he gave final approval to a $150-million settlement reached between Michael Goldberg, the court-appointed receiver, and Raymond James & Associates, a financial services company accused of enabling Jay Peak owner Ariel Quiros’ alleged fraud.

Judge Gayles tersely described the EB-5 program as one “through which an investor who invested $500,000 in a project that created ten or more jobs per investor would be eligible to apply for unconditional, permanent residency in the United States on an expedited basis.”

While Mr. Quiros owned Jay Peak and Burke Mountain Resorts, his companies ran eight such EB-5 projects. Six of them were completed or will soon be completed so their investors will qualify for permanent residency in the U.S.

The Burke Mountain Hotel opened for business last fall, but some planned amenities were never built, so not enough jobs were created to make all its investors eligible for green cards.

AnC Bio, the biomedical facility that was to be built in Newport, barely got off the ground, so none of its investors will qualify for U.S. residency.

According to civil fraud charges filed by the U.S. Securities and Exchange Commission (SEC), Mr. Quiros misappropriated about $220-million of the $350-million investors put into his projects. He was also accused by the commission of taking more than $50-million for his own use.

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