The federal government is trying to seize a piece of vacant land on the western edge of Indio, believing its owners committed fraud.
CIIF Hotel Group had proposed a four-story hotel and restaurants for the 6.42-acre site, according to city documents. But the FBI believes CIIF Hotel Group's owners were collecting investments through a controversial cash-for-visas program, then not finishing the developments they'd promised, according to an application for a search warrant filed by the FBI in April.
On Wednesday, the federal government filed a civil forfeiture action, the first step in the land seizure process.
Prosecutors repeated claims that CIIF Hotel Group's owners committed fraud, but no criminal charges have yet been filed against them.
According to court documents, the FBI investigated San Gabriel Valley residents Victoria Chan and her father, Tat Chan, in 2016. The pair runs the California Investment Immigrant Fund, CIIF Hotel Group and several other companies.
Authorities believe the two collected more than $50 million from more than 100 Chinese investors who were seeking U.S. green cards under the Immigrant Investor Visa program, known as EB-5.
The program allows wealthy foreigners to invest $1 million in development projects that creates at least 10 permanent jobs and receive green cards in exchange. Investment requirements fall to $500,000 for projects in economic development zones.
But, a federal prosecutor wrote in a complaint filed Wednesday, "Rather than legitimately investing the funds into American businesses, CIIF either refunded the funds to EB-5 investors while the investors' EB-5 petitions were pending, in direct violation of the EB-5 program, or stole millions of dollars to use for personal expenditures, including buying million-dollar homes."
The complaint continues, "As a result of the scheme, many foreign nationals were able to improperly obtain U.S. green cards through the EB-5 visa program, even though those foreigners did not in fact truly invest in U.S. businesses, nor were new American jobs created."
A rendering for an Indio hotel from CIIF Hotel Group, a company whose owners are being investigated for fraud.
Investigators also claim that some of the Chans' clients were fugitives in China, including several on that country's "100 most wanted list."
Charges have not yet been filed against Victoria Chan, a U.S. citizen, or Tat Chan, who is a foreign national, according to court documents.
EB-5, the visa program the Chans allegedly abused, has been widely criticized for poor vetting of visa recipients and failing to spur development in blighted areas. Congress must reauthorize it by Sept. 30 if it is to continue.
April's allegations, followed by a raid of CIIF's offices and the Chans' homes, were first reported by the Los Angeles Times.