EB-5: An Investigation – VTDigger


VTDigger has been reporting on allegations of fraud at Jay Peak Resort and related projects for three years — despite pushback from the developers of the ski area and Shumlin administration. In 2014 we documented complaints from immigrant investors in the Tram Haus Lodge that the developers had seized ownership of the hotel at Jay Peak without their knowledge or consent. We also reported that state officials who were charged with oversight of the projects had a cozy relationship with Ariel Quiros, the owner of Jay Peak, and Bill Stenger, the president and CEO of the resort.

In 2015, VTDigger reported that the Securities and Exchange Commission was investigating the Jay Peak developers and that the state of Vermont had raised questions about the finances of a proposed biomedical manufacturing plant in Newport that was also promoted to immigrant investors. State officials suspended AnC Bio Vermont after they discovered that a parent biotech company in Korea had gone bankrupt.

In April 2016, the Securities and Exchange Commission charged Quiros and Stenger with 52 counts of securities fraud and with misusing $200 million in immigrant investor funds through the EB-5 visa program, which grants permanent residency to foreigners who invest $500,000 or more in U.S. businesses and create at least 10 full-time jobs. In all, 836 investors from 74 countries were allegedly defrauded by the developers.

While Quiros is fighting the charges in federal court, Stenger settled with the SEC in August. State regulators were also involved in the SEC investigation and separately charged the developers with securities fraud. A criminal investigation by the U.S. Attorney’s office in Burlington is pending.

Quiros’ assets have been frozen and his properties including two ski resorts, Jay Peak and Burke Mountain Resort, and AnC Bio Vermont in Newport are in receivership.

The investors have sued Raymond James Financial Services for allegedly allowing Quiros to borrow against more than $100 million in investor funds.

Many of the investors blame the Vermont EB-5 Regional Center, an arm of state government that was charged with monitoring the EB-5 program in Vermont, for not properly overseeing the Jay Peak projects. Top state politicians, including Gov. Peter Shumlin, U.S. Sen. Patrick Leahy, U.S. Rep. Peter Welch and Gov. Jim Douglas all promoted the developments to investors overseas on behalf of Stenger and Quiros.

While VTDigger was able to obtain a number of public records for its investigation into the alleged fraud, the state has blocked release of hundreds of pages of emails between state officials and the developers. The news organization has sued the state for access to those documents.

This is an ongoing story. VTDigger has published more than 265 stories on the alleged fraud since 2014 and we are keeping up with new developments. Please check back for updates.

VTDigger stories from 2014 and 2015, and responses from the Jay Peak developers and the state


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