State Reaches $16.5 Million Settlement With Defrauded Jay Peak Investors | News | Seven Days | Vermont's Independent Voice


State Reaches $16.5 Million Settlement With Defrauded Jay Peak Investors


Published July 5, 2023 at 6:10 p.m.

The former Q Burke Hotel & Conference Center, a part of the Jay Peak Resort fraud - FILE: DON WHIPPLE
  • File: Don Whipple
  • The former Q Burke Hotel & Conference Center, a part of the Jay Peak Resort fraud
The State of Vermont has agreed to pay up to $16.5 million to settle claims by dozens of investors who were swindled in the Jay Peak EB-5 fraud, the Attorney General's Office announced on Wednesday afternoon.

In nearly three dozen lawsuits, more than 150 investors have been seeking recompense from Vermont for the state's role in overseeing the EB-5 program that Miami businessman Ariel Quiros and his partners exploited through a series of projects in the Northeast Kingdom. Quiros and local businessman Bill Stenger were both sentenced to prison terms for their roles in the fraud, which involved ski resorts and other business proposals.

Caught up in the scheme were roughly 850 foreign investors who were participating in the federal EB-5 program, which provides green cards to prospective immigrants who contribute at least $500,000 to qualified projects in the United States. The state maintained a since-shuttered regional center to oversee Vermont-based EB-5 projects. Investors have long asserted that the state, including then-Democratic governor Peter Shumlin, was complicit in aspects of the Jay Peak fraud.

Today's global settlement, if approved by the court, would resolve all investor litigation against the state and prohibit similar lawsuits in the future, according to the Attorney General's Office. It also means there'll be no trial in which more information about state officials' conduct could come to light.

"My team and I did not come to this decision lightly," Attorney General Charity Clark, a Democrat, said in a written statement. "Many years of extensive legal work, overseen by multiple attorneys general, have carried us to this point. This settlement removes the State’s exposure to financial risk and gives Vermont the opportunity to move forward from this chapter.”

The funds will be paid over three years to the Jay Peak receivership, a court-overseen management of the remaining project assets. The state will also try to aid the bilked investors in obtaining green cards; if successful, the state's financial obligation would be reduced by $4 million, according to the proposed settlement.

Vermont had previously agreed to settle the claims of eight Jay Peak investors for $750,000.

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