Raymond James Financial Inc. agreed to pay $150 million to settle a Miami federal class action brought by more than 850 EB-5 investors in the Jay Peak project.
The St. Petersburg-based financial services company faced claims that it aided and abetted the misuse of $200 million in funds invested through the EB-5 visa program, which helps foreigners obtain U.S. residency in exchange for a $500,000 investment in a job-creating enterprise.
The money was supposed to fund the expansion of Vermont's Jay Peak ski resort and related projects, but it was diverted by resort owner Ariel Quiros of Key Biscayne and his Vermont business partner Bill Stenger, according to Securities and Exchange Commission allegations. Because the projects weren't completed, investors feared losing their green cards.
Raymond James was a broker for bank accounts holding investor funds and helped Quiros raise $350 million through the EB-5 program. The accounts were managed by former broker Joel Burstein, Quiros' then-son-in-law, and investors claimed Burstein and former Raymond James manager Frank Amigo aided a fraud by giving Quiros margin loans collateralized with the EB-5 funds. The settlement fund will be managed by Jay Peak receiver Michael Goldberg of Akermanin Fort Lauderdale, who will use it to complete construction projects so that investors have a chance to secure unconditional green cards. Investors who put their money into construction projects that are "no longer feasible" will receive full refunds, according to Raymond James. The funds will also repay vendors and contractors.
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