Quiros, regulators lay out Jay Peak cases

Quiros, regulators lay out Jay Peak cases

EB-5 Visa, EB5 Visa, EB-5 Investment

Ariel Quiros will be allowed to sell his New York condominium to pay his living expenses, according to documents filed with a Miami federal court.

In April, the Securities and Exchange Commission accused Quiros, the owner of Vermont's Jay Peak and other Northeast Kingdom projects, of massive fraud related to the EB-5 program, which allows foreigners to receive residency if they invest $500,000 in a project in an economically depressed area.

The court approved a preliminary injunction freezing Quiros' assets after the SEC filed its civil fraud complaint in April. He has argued he is worth more than $200 million and needs $90,000 a month in living expenses, along with money to pay his lawyers. The court called the $90,000 sum unreasonable, but granted him the ability to sell or mortgage his condo in the Setai building in New York City's Financial District.

The court has ordered that if the condo is sold, the proceeds must be deposited into an escrow account that would be controlled by the federal receiver overseeing the resort and developments, because the court said there still are questions about whether Quiros purchased the property with misbegotten money.

Quiros's lawyers also submitted documents to the court Friday arguing the SEC has failed to provide evidence of Quiros's wrongdoing in managing the EB-5 money. The Miami businessman contends the SEC has failed to prove he was involved in soliciting investors or preparing investor documents. Quiros has denied all of the wrongdoing alleged in the SEC's civil complaint against him.

The SEC filed a similar document Friday. The commission stated Quiros has provided little evidence to rebut the federal agency's "mountain of evidence against him."

"As a direct result of Quiros’ schematic pilfering and misuse of investor funds, the Jay Peak ski resort and all of the limited partnerships are on the brink of collapse," wrote Robert Levenson, an SEC attorney. Jay Peak, according to testimony provided to the court by the federal receiver and cited by the SEC, has less than $6 million cash on hand, while facing $11.5 million to $16 million of expenses in the coming months.

Michael Goldberg, the receiver appointed to oversee Jay Peak, told the Burlington Free Press he will keep Jay Peak open and plans to open Burke in the near future, despite his dire testimony to the court.




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