Business & Economy

VTDigger exclusive: State pulls plug on EB-5 project

An EB-5 Green Card sample.
An EB-5 Green Card sample.

Editor’s note: Anne Galloway contributed to this report.

A development company that hoped to build high-end assisted living facilities for retirees in Vermont has lost approval from the state’s EB-5 center.

The company, DreamLife Retirement Resorts, LLC, with representatives in Quebec, Ontario, Vermont and Florida, hoped to build six well-appointed, 160-apartment unit projects. The plans for the assisted living facilities include spas, salons, libraries and movie theaters. In February, the company was negotiating purchases of sites selected in Bennington, Rutland and Montpelier, documents show. DreamLife planned construction at two of the sites within the year.

In order to make that plan a reality, the company, doing business as EB-5 American Dream Fund I, Inc., needed to raise more than $144 million and attract more than 300 foreign investors who, under a federal program known as EB-5, receive green cards in exchange for cash investments, according to the company website and state documents.

The DreamLife developers have not purchased land or obtained options on properties, nor have they attracted a single foreign investor.

Nearly three years have passed since American Dream first received permission from the Vermont EB-5 Regional Center to seek foreign investors for two apartment buildings, and in the intervening period, the DreamLife developers have not purchased land or obtained options on properties, nor have they attracted a single foreign investor. Though it’s not uncommon for a project to take three years to attract adequate funding, officials and experts say, it’s difficult to bring on investors if a site hasn’t been secured.

Officials with the Vermont Agency of Commerce and Community Development cancelled the agreement with American Dream on March 27 because of “material misrepresentations.” Three of the four individuals who represent the company cited themselves as attorneys for the project; none of the men identified are licensed to practice law in Florida, where the law firm cited in the agreement, USMS Team, is registered.

In addition, American Dream listed a DreamLife construction team on its website that state officials determined were not notified that they had been identified as contractors for the project. Several said they did not have contracts with the company.

American Dream has 14 days to respond to the state’s notice of cancellation. Phil Mooney, the managing director of DreamLife and a former CEO and president of the nonprofit Immigration Consultants of Canada Regulatory Council, told VTDigger the company would resolve the issue with the state in a few days. As of April 3, there was no update from the company.

“We can refute and justify everything,” Mooney said. “We have 14 days to provide a remedy, and we believe we can absolutely do that. Not even in 14 days, in just one or two. We disagree completely with the letter and are busy preparing a response which will see us continue as an EB-5 project under the [Vermont] Regional Center.”

It’s not the first time the state has lost confidence in American Dream. In September, the Vermont EB-5 Regional Center cancelled its memorandum of understanding with the company when officials discovered that American Dream had changed its development plans and neglected to send an economic assessment to the state. Originally, DreamLife proposed two retirement resorts; in 2011, the developers decided to expand the number to six without formally notifying the Vermont center, according to the state.

Richard Parenteau, the founder of DreamLife, who state officials say is now a “background investor,” was convicted of perjury in Quebec in October 2010.

Last spring, state officials became aware that a key participant in the project recently stepped down from a leadership role in the company. Richard Parenteau, the founder of DreamLife, who state officials say is now a “background investor,” was convicted of perjury in Quebec in October 2010, according to court documents, after a decade-long dispute over a will. State officials say as a result of the conviction, Parenteau, a former Rock Forest (Quebec) chief of police, is no longer able to cross the border for meetings in Vermont. Parenteau has also been accused of violating labor rules in Quebec, according to court documents.

Over the last 20 years, Parenteau has created and dissolved more than two dozen companies in Florida and Vermont, some of which list his sons Marc-Andre and Richard Jr. as business associates, according to information from state websites. Five of the entities bear the DreamLife name, including an insurance company, a real estate firm and a finance company, all three of which are now inactive.

Parenteau declined, through Mooney, to be interviewed for this story.

Mooney defended his longtime business partner and friend.

“I understand that certain individuals have raised questions about past and present developments,” Mooney wrote in an email. “My belief is that as soon as we begin operations, and better yet, as we deliver on our promises, these stories will be seen to be irrelevant.”

Mooney described Parenteau as a generous person who is a “typical entrepreneur.”

“He gets really big ideas, and he’s not afraid to invest in them,” Mooney said. “People like that who get ideas — sometimes they don’t all work out.”

State officials, including the former head of the Vermont EB-5 Center, and Kevin Dorn, the former secretary of the Agency of Commerce and Community Development who signed the original agreement with Parenteau in 2010, apparently knew little about the businessman’s past. It wasn’t until last spring that state officials were alerted to Parenteau’s legal difficulties.

Lawrence Miller, Secretary of the Agency of Commerce and Community Development, speaks at a press conference with Governor Peter Shumlin. VTD Photo/Taylor Dobbs
Lawrence Miller, secretary of the Agency of Commerce and Community Development, speaks at a press conference with Gov. Peter Shumlin. File photo by Taylor Dobbs

Lawrence Miller, the current secretary of the Vermont Agency of Commerce and Community Development, cancelled the agreement with American Dream in September and then reinstated the memorandum of understanding (MOU) in November after he and other state officials were assured that Mooney would lead the company and that a new escrow account had been secured.

The state’s latest decision to cancel its agreement with American Dream, based on the aforementioned “material misrepresentations,” comes on the heels of accusations that the company may have violated Securities and Exchange Commission rules with regard to marketing to investors.

Agency Secretary Miller said it’s unlikely the state will reinstate the American Dream MOU. In the cancellation letter, he wrote: “Based on the nature and significance of the examples of material breach, we do not foresee American Dream Life Fund I being able to cure them or remedy the broken trust.”

State officials say the Vermont EB-5 Center, which so far has a 100 percent success rate, must maintain its stellar reputation in order to continue to attract investors.

John Kessler, general counsel for the commerce agency, said as the No. 1 ranked regional center in the country, the Vermont EB-5 Center is under scrutiny from the nation’s biggest media outlets. The Boston Globe, the Wall Street Journal and the New York Times, he said, “come to us.”

“We’re kind of in a bull’s-eye of a target for a lot of things, and we’ve done really well,” Kessler said. “Our approvals at the adjudication centers are the best in the country, and so what it comes down to for us is a matter of confidence.”

Confidence, Kessler said, is crucial for the success of the center and the state’s other 14 projects. “We’ve worked hard for 16-plus years to get where we are with this regional center, and we do have unparalleled success, and our reputation is important so if our confidence level is shaken, and if we read about things and ask ourselves how confident are we, that’s a very important factor,” he said.

David North, a fellow with the Center for Immigration Studies and a vocal critic of the EB-5 program, said he’s “never heard of a regional center doing something like this.”

“Vermont is the only one in the country that is an arm of the government, as opposed to Chamber of Commerce regional center,” North said. “It’s perfectly possible that the Vermont entity has a different agenda and a higher standard than other folks.”

One national expert on EB-5 projects, who asked to remain anonymous for fear of losing clients, told VTDigger that making a “material misrepresentation” is a “bad thing to do, if you’re trying to get a project done.”

The state and other developers in Vermont have a lot at stake. In December, Bill Stenger, an owner of Jay Peak Resort, proposed a sweeping $600 million megadevelopment in the Northeast Kingdom that would be financed by the EB-5 visa program and generate as many as 10,000 jobs. The projects include a new conference center, improvements to two ski areas, regional airport improvements, the construction of a biotech research firm and a window manufacturing plant. It has been hailed as the largest investment in economic development in the state’s history and a game changer for Vermont’s most remote rural area. Half of the state’s 14 EB-5 projects are associated with Stenger’s Northeast Kingdom developments.

Gov. Peter Shumlin and the three members of Vermont’s congressional delegation — Sens. Bernie Sanders and Patrick Leahy, and Rep. Peter Welch — have been vocal supporters of Stenger’s project. Shumlin was criticized in the press for helping to sell the project to investors at a meeting in Miami earlier this year.

Bill Stenger, owner of Jay Peak and Burke Mountain resorts, shows lawmakers plans for development in the Northeast Kingdom on Feb. 5, 2013,at Jay Peak. Photo by Nat Rudarakanchana
Bill Stenger, owner of Jay Peak and Burke Mountain resorts, shows lawmakers plans for development in the Northeast Kingdom on Feb. 5, 2013, at Jay Peak. File photo by Nat Rudarakanchana

EB-5 and the state

The questions about American Dream highlight issues confronting the federal visa program used to attract foreign investors to projects. The EB-5 visa program is designed to infuse capital into risky projects and offer foreigners an opportunity to obtain a green card for two years with the possibility of gaining permanent residency if the projects create jobs. Investors, who must make at least $500,000 in cash available to participate in the program, are not guaranteed a return on investment, nor is there any promise that their investments will be held harmless.

Investors are eligible for permanent residency if the company they invest in generates 10 new jobs that last for at least a 24-month period. In the case of DreamLife, each of the six resorts — at a cost of $24 million — is projected to create 153 direct jobs and generate work for 205 additional people, Mooney said.

The federal EB-5 visa program has been championed as an effective tool for job growth in America, and last August, Sen. Leahy pushed hard for a three-year extension.

Vermont has a long history with the federal program. Former Gov. Howard Dean, a Democrat, was a proponent of EB-5, and in 1997 helped to develop Vermont’s program. The center was authorized by the U.S. Citizenship and Immigration Service in 2007 and was approved for EB-5 visa investments in 2009.

Vermont’s center is unique because it is the only state-run EB-5 program in the country that certifies and approves businesses, and it currently maintains 14 different projects. Most centers are for-profit and are directly tied to individual projects, state officials say.

Howard Dean. Photo by Vincent Gallegos
Former Vermont Gov. Howard Dean. Photo by Vincent Gallegos

There are approximately 160 centers nationwide, according to Jeffrey Carr, an EB-5 analyst who also serves as an independent economist for the Shumlin administration.

American Dream was one of the state’s first projects. It sought approval in July 2009 and entered into an agreement with the state a year later. In all, the state has 14 projects, including seven associated with Jay Peak and Stenger’s megaproposal, Sugarbush Resort, Trapp Family Lodge, DR Power Equipment and Country Home Products.

In May of last year, Brent Raymond, who had just become the head of the Vermont EB-5 Center, started getting phone calls from the former head of the project. He learned at that time that DreamLife’s economic study had changed significantly from just two buildings to six. In September, the state pulled the agreement with American Dream.

“That combined with their not being active for a couple of years, we weren’t comfortable with the MOU they were working under as being current because the economic impact study is very material to our decision-making as well as to USCIS,” Raymond said.

After the developers made a concerted effort to document their progress and changes with DreamLife project and were able to show they had a bank escrow account, the state signed a second memorandum of understanding with American Dream in November.

American Dream, like all projects through the Vermont center, is required to file quarterly reports with the Agency of Commerce and Community Development. Officials provided VTDigger with the two agreements and other documents, including the cancellation notices, but at press time, the progress reports were not available.

Once the DreamLife project was reinstated by the state in November, Mooney and his team traveled with Raymond to attract investors from China and Vietnam.

It appeared that DreamLife might have secured tens of millions in funding early this winter after visits to Asia, but the situation was complicated by news that broke last month about a scandal involving the EB-5 center associated with the Chicago Convention Center. More than $145 million in securities were fraudulently sold and about 250 largely Chinese investors lost $11 million in administrative fees for the Chicago project before the Securities and Exchange Commission froze the project assets and shut down the center.

Even though the Chicago project is unrelated to DreamLife, the scandal didn’t help the Vermont American Dream project, or any other EB-5 program for that matter, in its quest for investors.

According to the LexisNexis Corporate and Securities Law Blog, the SEC prosecution has been widely reported by China Central Television, the largest TV network in China, and the Chinese government has warned investors about fraud in the EB-5 program.

“It is very rare for the Chinese Ministry of Foreign Affairs to make such a bold comment,” the authors, Mona Shah and Yi Long, wrote. “The important issue that should not be forgotten is that the joint action of USCIS and the SEC actually prevented the investment funds from being dissipated.”

American Dream runs afoul of state officials

In the cancellation letter sent to American Dream on March 27, state officials said project leaders falsely claimed to have retained licensed attorneys and listed people as project partners without their knowledge or consent.

Mooney denies that American Dream is responsible for these claims, which the state labeled “material misrepresentations.”

The letter from the state contends that American Dream’s legal counsel, USMS Team, LLC, consists of Richard Parenteau, Richard Beaupre and David Gervais, all of whom are involved in the DreamLife project, and none of whom are licensed to practice law in Florida where USMS Team is registered. Gervais, the project’s chief operating officer, practices law in Quebec and New York state.

DreamLife contends this should not present a problem.

Phil Mooney. Canadian government photo. Image was taken when Mooney was the CEO of the Immigration Consultants of Canada Regulatory Council (ICCRC).
Phil Mooney. Canadian government photo. Image was taken when Mooney was the CEO of the Immigration Consultants of Canada Regulatory Council (ICCRC).

“Legal counsel will be contracted out to experienced EB-5 counsel, if issues arise that require their services,” Mooney said.

Mooney says Brent Raymond, who heads Vermont’s EB-5 Regional Center, knowingly signed off on the USMS Team, LLC, as a placeholder substitute for DreamLife’s more complex legal arrangements.

“We have in-house legal counsel now, and will add legal counsel as demand requires,” he said. “And we will have specialized legal counsel if we need it. That arrangement was made very clear.”

The state’s cancellation letter also cites inquiries regarding trade professionals on materials American Dream “used to market its EB-5 project.” The company named architect Tom Leytham and engineers Carl Childs and Edward Pearson, as project participants on their website although neither knew they’d been listed, nor given their consent.

In an interview, Raymond said this could be seen as “false marketing.”

Mooney said he’d spoken to Leytham on March 28, and that Leytham “categorically denies” he told the state he objected to being included on DreamLife’s website.

“He’s been receiving money from us. He’s been involved all along, and had no objection whatsoever,” Mooney said of Leytham.

Leytham couldn’t be reached for comment.

Mooney is preparing letters from people who are reiterating they have no objection to being associated with DreamLife, adding: “This is common practice in our industry, that you list your subcontractors in your project.”

“This list has been around for two years,” said Mooney. “All of the people on the list were more than happy to be on the list.”

Pearson, whose firm is supposed to handle DreamLife’s electrical, mechanical and geothermal engineering, said he met with company officials once, in Stowe in 2011, and he hasn’t done any work for them.

Childs, an engineer from Williston, last heard from DreamLife principals almost two years, at a June 2011 meeting in Stowe.

“I don’t know if it’s active or not,” Childs said.

Childs is listed as the structural engineer for DreamLife, and his resume was posted on DreamLife’s website in an undated document that compiled the resumes of the entire construction team.

Although Childs hasn’t performed any paid work for DreamLife, he doesn’t object to being linked to the development.

“As far as I was concerned, the project was dead a year and a half ago,” said Childs. “To me there is no project, there is no connection there. If they want to put that stuff up there, I suppose I should object. On the other hand, I don’t see anything bad coming out of it.”

Mooney isn’t sure when the list was last updated, saying it could be four or six months ago.

On Friday, the list of contractors disappeared from the American Dream website.

A questionable video

While on a trip to China with Mooney earlier this month, Raymond received an anonymous email complaint about DreamLife promoting Vermont as a great place to host projects.

The anonymous complaint alleged that DreamLife’s website violated Securities and Exchange Commission laws about how securities can be marketed.

The video, which featured a text scroll that Raymond had not approved, has since been taken down.

Alarmed, Raymond ordered DreamLife to take down an online video in which he and the state endorse the project, until they had received legal advice clarifying their website met all SEC regulations. The video, which featured a text scroll that Raymond had not approved, has since been taken down.

Within hours, according to Mooney, securities lawyers advised him the website was already in compliance with federal regulations. But they encouraged him to “tweak” some “legalese” in their disclaimer.

Susan Donegan, commissioner of the state’s Department of Financial Regulation which regulates securities, explained to VTDigger anybody marketing securities must not mislead investors with marketing materials that tout the “merits of the possible future success of the project” while failing to disclose major risks.

“Nothing is to be sold or solicited in a way that is to mislead investors,” said Donegan. “You want there to be full disclosure about the risks of an investment.”

She said a website notifying investors of the existence of an EB-5 project is generally acceptable, though disclosing too much detailed financial information before vetting potential investors is generally prohibited.

Donegan declined to comment on DreamLife’s website.

“We don’t, here at the department, opine on those kinds of things. I have no opinion,” Donegan said. “Someone must file a complaint to trigger our investigatory requirements.”

Lack of property investment raises questions

Despite actively searching for sites in Vermont for at least two years and seeking foreign investors, the DreamLife development project owns no land and holds no options on any property.

Jeffrey Carr, an economist who has produced hundreds of job projection reports for EB-5 projects nationally, said that a project that lacks ownership or control of land while still actively seeking investors is an odd combination.

Jeffrey Carr
Jeffrey Carr

“People usually have control of the land before they sink all the money into an EB-5 project,” said Carr. “The problem is that if you don’t control the land, and then lose control of the land, then your project is done [dead], if you can’t build the project you said you were going to build. If you know that a parcel is available and then go off and try to build an EB-5 project without actually owning the land, it’s kind of a silly thing to do, because you could lose control of the land and then your project would be dead.”

David North, a national EB-5 policy expert with the Center for Immigration Studies in Washington, D.C., said if projects don’t have even an option on the land, in which the landowner is obliged to sell the land at a specified price and time “that would sort of raise some very large questions about the whole thing.”

“They should certainly have control of the land first, if they’re going into a specific building project,” he continued. “I’d think that’d be a necessary thing. Otherwise you get the money, and where are you going to build the building, if you don’t have control of the land?”

Under EB-5 program rules, funds from foreign investors cannot be used to buy land. Properties must be purchased with other funds, often from company principals who are managing the project.

A USCIS spokesperson told VTDigger that the agency, which processes I-526 immigration petitions that foreign investors file for conditional green cards, has no regulations that specifically address land ownership or control.

“Each case is looked at, in its totality and its circumstances, for compliance with our eligibility criteria,” she said.

Mooney said that it would be “irresponsible” for DreamLife to purchase land without first securing investors. He said the company is weeks away from securing its first committed investor, with about 30 investors at varying stages in the long process between initial meetings and laying down funds.

“It would be highly irresponsible to go out and purchase land, which doesn’t count towards EB-5 investment, before you actually have investors,” Mooney said. “We didn’t get into this business to own land.”

“We have done all the work to acquire land, but we won’t put out the money or capital on the land, because once you do, you own it. And you can’t turn around and sell it the next day,” Mooney said.

Mooney wouldn’t disclose how they’d finance a land purchase, but said that company principals, primarily himself, chief operating officer David Gervais, CEO Richard Beaupre, Richard Desilets, and former chief Richard Parenteau, had already invested about $500,000 in cash from their own money over the years, as well as collective time and effort worth about $1.5 million.

James Candido, former director of the Vermont EB-5 Regional Center from 2005 to 2012, said when the state first approved DreamLife, he repeatedly told company principals that they needed to buy land and acquire permits. “I don’t know if they internalized it or not, but they were aware of it,” he continued.

“There were different parcels of land that they kept trying to work on. And just each parcel didn’t work out,” he said. “That was sort of what was hanging everything up.”

“Frankly, the biggest issue with the project was just honestly that there was no activity from it,” said Candido of his years working with DreamLife. “There was none. As far as I could tell, they never talked to an actual investor. … So as far as I knew, and so far as they told me, their marketing was somewhat non-existent.”

“People usually have control of the land before they sink all the money into an EB-5 project,” Carr said.

Although speculative projects across the nation tend to be less successful, Candido said, that doesn’t mean a lack of land is a hurdle that can’t be overcome — with the right strategies.

Candido said the project appear to be speculative “in the sense that it didn’t own land. And if you don’t own land, you obviously don’t know where it’s permitted.”

Raymond told VTDigger it’s “totally fine” for DreamLife to market to investors despite not controlling land, so long as they disclose that up front. But he added: “I honestly would not have approved the project knowing that they hadn’t selected properties, and that there’s potential permitting issues – except that they had already been approved previously.”

Raymond is now actively reviewing state standards on the question of land ownership and how far projects have progressed on land use permits. “I can say that is not the only project I know of that hasn’t had land in hand,” in terms of EB-5 projects nationally, Raymond added.

“In the future, if we made any changes to whether we approve projects, it wouldn’t be necessarily about owning land. It’d be: Do you have permits in place? Because that’s what really takes time,” he said.

Parenteau’s perjury conviction and role in DreamLife

State officials have raised serious concerns about DreamLife’s founder, Richard Parenteau, who is still involved with the company on a daily basis.

Parenteau was DreamLife’s project manager from 2009 until the summer of 2012, according to Mooney. Parenteau founded the project and authored the project’s overall vision. He also signed the first memorandum of understanding with Vermont’s Regional Center, in July 2010, as a general partner.

Now Parenteau is a senior adviser for DreamLife: He helps to structure the project’s complex business consortium, and he selects partners and contractors, according to Mooney.

In October 2010, a Quebec court convicted Parenteau of perjury, a conviction which he later unsuccessfully appealed, according to Canadian court documents. The former police officer fabricated false documents, records show.

“I’m aware of it [the conviction], and it gives me no concern,” Mooney said.

Mooney said Parenteau is free to travel in and out of the United States, despite his perjury conviction, contrary to what state sources alleged to VTDigger.

“I’m aware of it [the conviction], and it gives me no concern,” Mooney said. He encouraged people to read the actual court records and see that the conviction stemmed from forgivable and well-intentioned mistakes on Parenteau’s part. “[Richard] stands by his friends,” he added. “If he has a fault, he’s too trusting.”

Two of Parenteau’s other businesses, Can-Am Investment Construction Job Center and Work Permits USA, have faced claims from employees that they haven’t been properly paid. Two employees have won their court cases; in another, Parenteau prevailed.

In one case from May 2008, Can-Am Investment Construction Job Center was ordered to pay $696 Canadian dollars to contractor Diane Chicoine for “canvassing” work, although Parenteau denied that Chicoine delivered tangible results, with the court agreeing that Chicoine could not produce detailed proof of the work she did.

In another case from September 2011, Fair Ways Development claimed Work Permits USA, an immigration firm, owed them about $5,000 Canadian dollars in unpaid bills for web design work, and won that payment, plus interest.

Mooney said that Parenteau doesn’t handle investors’ money in DreamLife. Mooney, CEO Richard Beaupre, and chief operating officer David Gervais are now the key decision-makers, he said. Neither the three partners nor Parenteau are paid at the moment, said Mooney, partly because the company hasn’t generated any revenue yet.

Vermont EB-5 Regional Center director Brent Raymond said that Parenteau’s background wasn’t of material relevance when the state reinstated DreamLife’s MOU in 2012 because Parenteau is no longer a decision-maker for the project.

Yet, information that came up while he vetted the background of the entire DreamLife management team, Raymond said, “caused me to question his [Parenteau’s] business, how he operates as a business person.”

Raymond said DreamLife project principals (i.e., Mooney and others) presented a different side of the story as to the perjury conviction, but also assured Raymond that Parenteau couldn’t apply undue pressure within the project.

For Raymond, a big reason for later re-approving DreamLife was that its new management team was led by Phil Mooney, instead of Richard Parenteau.

“It wasn’t typical for us to do a personal background check, on someone coming with an EB-5 project. We didn’t do background checks. It just wasn’t within the scope of what we approved.” ~Candido

“These [new management] structures that I’ve seen [and Mooney’s leadership] provided me comfort that even though he [Parenteau] is involved behind the scenes, and still has an interest in the project, he is not a decision-maker,” Raymond said.

“I didn’t see somebody like Phil Mooney, with his excellent reputation, putting his reputation on the line for a project like this” if there were unacceptable risks, Raymond said, citing Mooney’s distinguished career and work with the Canadian government. “With a new management team, I thought everything would be OK.”

Raymond’s predecessor, James Candido, says that in 2010 he didn’t conduct a review of the principals at DreamLife and remained unaware of Parenteau’s background.

“It wasn’t typical for us to do a personal background check, on someone coming with an EB-5 project,” said Candido. “We didn’t do background checks. It just wasn’t within the scope of what we approved.”

“We would approve them on the merits of their EB-5 [project],” said Candido. “We don’t monitor anything else. It’s not in our jurisdiction.” But, Candido added, if someone had come forth with evidence of problems with company directors, even outside of their limited EB-5 project arena, he would have investigated.

“One of the ways that I describe it is that an EB-5 application is similar to a land permit,” Candido said. “You don’t look into everything, into the background of the people necessarily for a land permit. You just look at the validity of the land permit.”

Editor’s note: This story was supported by a grant from the Fund for Investigative Journalism.

CORRECTION: The story originally read: “Richard Parenteau, the founder of DreamLife, who state officials say is now a “background investor,” was convicted of perjury in Quebec last summer.”

In fact Parenteau was originally convicted of perjury in October 2010. His appeal to overturn that conviction was defeated in June 2012. The article has been updated to reflect that, at 2:40pm on April 8, 2013.

The article now also includes translations of court records related to Parenteau, which were commissioned by VTDigger for this article.

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Nat Rudarakanchana

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  • Bob Stannard

    This is a remarkable piece of journalism. Hats off to VT Digger for this detailed, in-depth story.

  • Fred Woogmaster

    EB-5 – my oh my!
    Double kudos to The Digger!

  • Pete Novick

    Great article!

    After reading it, I scrolled back to the top hoping to read that the dateline was April 1st. That would have made it perfect.

    Creating 150 jobs that pay just above minimum wage with no benefits is not a solution to Vermont’s employment challenge which has been, and continues to be, the lack of quality job growth.

    A quality blue collar job in America today pays at least $17 an hour and comes with a benefit package worth another $5K (medical, retirement, paid sick leave, etc.). So, that’s an entry level job at Sikorsky Aircraft in Connecticut, or another company selling with a high value added product or service.

    Vermont’s elected representatives like to say that Vermont has a much lower unemployment rate than the national average and that Vermont’s economy is growing faster than 35 other states. Both of these statements are true up to a point, but they do not tell the whole story. The average wage in Vermont is well below the national average.

    It reminds me of that old stand-up comedy routine:

    “Hey, I just signed a contract for a million dollars!

    Wow, that’s great. What are the terms?

    A dollar a year for a million years.”

    • Eric Robichaud

      I agree………..GREAT ARTICLE.

      And to your comments Pete;

      “Moonlight in Vermont………..or starve”

    • Doug Spaulding

      How about 10,000 jobs that do the same thing?

    • Tom Pelham

      Vermont’s low unemployment rate unfortunately is not all that the media’s headlines have implied. You can go here and see that while the unemployment rate went down to 4.4% in February, the number of employed Vermonters in February fell by 1,000. This pattern has been evident over the past few years with the unemployment rate exhibiting substantial gains but the number of employed fluctuating within a narrow range. Not good!!

  • Jacob Miller

    Yawn. Is Vermont Digger paying by the word now?

    A questionable developer proposes a questionable project and it fails. Surprise, surprise, surprise. 160 units of luxury retirement living units in Rutland, Montpelier and Bennington? Where is the market for them even with Vermont’s aging population? If Vermont Digger wants to inform its readers about the EB-5 Program this project wasn’t the vehicle. If they wanted to expose a questionable developer, they succeeded, but didn’t need to bore readers with such a lengthy missive. Four paragraphs could have easily done the job; Who, What, When and Where? Turn the paper back to the student for a re-write if course credit is needed.

    • Karl Riemer

      I see more wasted words in this one paragraph than in the entire article. The comment amounts to “I’m confused and bored. I don’t know how to read and too much information makes my head hurt. Someone besides me should fix this problem.”
      Someone did. It’s called television news.

  • While I can understand “We didn’t do background checks” in the context of a formal business process, which involves release forms and expenses, but…couldn’t someone at the office just google some of these folks? Public domain is a pretty rich data set these days!

    Fantastic article.

  • Harman Clark

    I would like to see an article about the morality and sensibility of selling green cards to ultra-rich Asians (whose wealth may come from getting interest payments from the U.S. Govt. on U.S. debt), and not granting green cards to young European mathematicians and engineers who would be a benefit to our country but don’t have the money to Buy citizenship.
    And since these programs (including Stenger’s) are so risky that they can’t attack American investors, what happens after the lodges, hotels and airport runways are built and no one uses them?

  • Harman Clark

    sorry “attack” should be “attract”

    • Karl Riemer

      oooooh… that was the best part!
      As for what happens to abandoned infrastructure when that obscene amusement park complex fails through megalomaniacal excess counting on canadian bad taste: we can ask Plattsburgh for advice.

  • Excellent article – well done Nat Rudarakanchana. This article is one of the few that gets it.

  • Steve Raphael

    Great piece of journalism. Thank you.

  • Terry Bequette

    Agree with all who complimented this good piece of investigative journalism. Nice work, Nat!

  • Mark Jefferies

    Great work Nat. Keep going though. The details of these EB-5 projects is all confidential and no one is actually providing oversight to see that all projects are in compliance through transparent audited financials. If the NEK projects go south, it will do more damage to the area then if the projects succeed. Get the state to publish oversight results on a project by project basis. Please!!!!!!

    Our governor, Senators, Congressman, have all blindly supported this to the end and they have no idea if the due diligence and compliance is in place. It always about the photo op.

    We need your investigative journalism so much in Vermont. Thank you!

    • Mark,

      It is all about schlepping funds in any way possible to finance government-business “partnerships” that fortify the bank accounts of multi-millionaires, at the expense of all others.

      More than half the legislature votes to OK it.

  • A great article that must have taken many hours to research and write.

    Anne, thank you for assigning someone to the job and running it on VTDigger.

    This same agency should pull the plug on Stenger’s energy-guzzling, CO2-emitting, water parks, financed by “free-money, foreigners-come-first” EB-5 projects in the NEK. They are about as useful for job creation as wind turbines on ridge lines.

    What NEK folks need is not more quality-of-life-reducing wind turbines, but programs that insulate and seal their homes.

    Stenger should start energy efficiency projects, instead of energy-guzzling projects.

  • Chuck James

    Who funded this and did that create bias? Could it be someone competing for the eb-5 funds?

    • The Fund for Investigative Journalism was the source of funding for this story.

  • Shehryar Iqbal

    Hi everyone,

    I am an investor from Dubai who is planning to invest in the EB-5 programme in Vermont.
    If there is anyone with some experience please let me know.
    Kind regards.

  • H. Brooke Paige

    Keep on “digging,” your attention to detail is much needed as the “lame stream” media seem unable or unwilling to dedicate more than a few hours effort in developing a story !

    It takes real investigative work to fully develop important articles like this.

    Thank You for Your Efforts !