Vermont has settled a lawsuit against two ski resort developers who were accused of defrauding the state’s troubled immigrant investor program.
Attorney General T.J. Donovan announced on Thursday that former Jay Peak ski area owner Ariel Quiros, of Miami, will pay the state $2 million, satisfied by giving it five properties in and around Jay Peak. Those properties will be liquidated, and the money will be earmarked for economic development, Donovan said.
Former Jay Peak president William Stenger will pay the city of Newport $100,000, also earmarked for economic development.
The settlement is subject to court approval. If approved, the state will drop the lawsuit against both men.
Quiros’ lawyer Melissa Visconti said Quiros is “happy that this is another step in the direction of putting all of this behind him.” Stenger’s lawyer David Cleary said his client acknowledges a lack of oversight on the project and requested to pay the $100,000 directly to Newport.
Donovan, a Democrat, said his office chose to settle the lawsuit because it would allow him to turn documents over to state Auditor Doug Hoffer, also a Democrat, to determine whether the state mishandled the EB-5 visa program.
“The greatest harm that this scandal has inflicted on our state is the loss of public trust in state government, specifically the question of what did state government do or didn’t do in terms of the management of EB-5,” Donovan said.
The EB-5 visa program helps foreigners obtain permanent residency by investing in job-creating developments in the U.S.
Quiros and Stenger were accused in 2016 of misusing more than $200 million raised from foreign investors through the EB-5 program for developments at or near the resort. Besides the settlement with Vermont, Quiros has reached an $81 million settlement with the U.S. Securities and Exchange Commission, and Stenger has agreed to pay a $75,000 penalty.
Donovan and Gov. Phil Scott, a Republican, made the announcement in Newport, which was hit hard after the discovery of the fraud alleged by authorities.
Quiros and Stenger had planned to bring a biotechnology firm and a rental building to the small town near the U.S.-Canadian border. The sites are currently undeveloped.
Donovan said he hoped that “by closing this chapter today, but getting some money to this great city, it will continue its work towards a brighter future.”
Donovan said his predecessor chose to bring a lawsuit against Quiros and Stenger and ethics prevent him from pursuing criminal charges after a civil action. There currently is a federal investigation into the visa fraud case.
David Jordan reports for the Associated Press.