Bought luxury goods with ill-gotten gains, says suit.
By Raif Karerat
The EB-5 Green Card promoter Lily Zhong and her company, EB5 Asset Manager, LLC. have been named in a civil action suit filed by the SEC in the United States District Court of Southern Florida on Nov. 3.
The SEC alleges that since at least March 2011, Zhong has used several entities that she owns and controls to exploit the EB-5 program, defrauding at least 17 investors out of $8.5 million and buying herself $175,000 Sea Ray yacht, a brand new $100,000 Mercedes Benz S-550 and a $55,000 BMW X5 – along the way.
According to the National Law Review, Zhong allegedly concealed her scams through a complex arrangement of layering her EB-5 deal with related corporate entities that she controlled.
The SEC also charged that there were “alleged omissions from offering documents about her being the subject of bankruptcy proceedings in New Zealand”, suggesting the multi-national habits of some of the EB-5 promoters, according to the Center for Immigration Studies.
The National Law Review noted that it is likely that at a minimum, the SEC should prevail on its request to freeze Zhong’s assets, and she is likely to be permanently ousted from the investment business.
Per the U.S. Citizenship and Immigration Services, EB-5 visas provides method of obtaining a green card for foreign nationals who invest money in the United States.
To obtain the visa, individuals must invest $1,000,000, or at least $500,000 in a “targeted employment area,” creating or preserving at least 10 jobs for U.S. workers excluding the investor and their immediate family.