200 Asian investors victims of California’s largest EB-5 fraud ever?
A prominent Oakland businessman and two others are accused of committing a massive EB-5 fraud that could be the largest of its kind in state history. The trio took in $110 million from over 200 investors, and promised to create 2,000 jobs but are accused of using the money for their own real estate purchases.
The San Francisco Regional Center promises “safe investments to set your family on the path to American citizenship” on their website. But federal charges say this promise of safe investing was a lie.
The U.S. Attorney for the Northern District of California, David Anderson, states that the case is the largest EB-5 fraud ever in California. Anderson says Oakland businessman Thomas Henderson was the mastermind of the scam, working with fellow Oakland resident Cooper Lee, and Chinese national Kexing Hu.
EB-5 Investor expectations & impact
“One of the ways in which this scheme was being hidden was the diversion of money raised from later investors to cover over the losses that were being suffered by earlier investors,” declares Anderson. Roughly 75 of the EB-5 investors are living in the Bay Area but are likely to be forced to return to their home countries.
Henderson’s past & current charges of EB-5 fraud
The SEC sued Henderson in 2017; he then had to sell the Tribune tower and his holdings went into receivership.
Henderson and Copper are charged with conspiracy and wire fraud. Hu remains at large in China. If convicted of all charges, the three could face up to 290 years in prison.
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