A new court filing includes a list of people who federal prosecutors allegedly said “could qualify” as co-conspirators in the massive Jay Peak Resort fraud case but have not been charged.
The filing was submitted Monday by defense attorneys for former Jay Peak President and CEO Bill Stenger, who is under criminal indictment.
The names listed in Stenger’s filing include Alex MacLean, who served as deputy chief of staff and campaign manager for former Vermont Gov. Peter Shumlin. MacLean went to work for Jay Peak in 2013 and managed the Renaissance Project, a proposed office building on Main Street in Newport that never materialized.
It has not been proven whether any of those mentioned in the filing are, in fact, co-conspirators. In addition to MacLean, others mentioned are George Gulisano, a former CFO of Jay Peak; Deborah Wong, who worked as an analyst at the consulting firm Frost & Sullivan; Joel Burstein, a former broker for Raymond James & Associates; and three business partners in a Newport biomedical facility, including Ike Lee, Jake Lee and Candice Campbell.
Brooks McArthur and David Williams, attorneys for Stenger, wrote in the filing that federal prosecutors notified them in July 2020 that statements of several “co-conspirators” could be admissible as non-hearsay.
That means their statements could be brought into the courtroom without their having to testify, and as a result they would not be subject to cross-examination. Stenger’s lawyers are seeking to avoid such a scenario.
McArthur, reached Monday, declined to comment and would not release the communication from federal prosecutors that allegedly described the seven as co-conspirators.
Richard Rubin, an attorney for MacLean, took strong exception to any assertion that his client could be considered a co-conspirator.
The filing, Rubin said Monday, does not support a conclusion that MacLean and the other six people listed in the document have been deemed co-conspirators in the Jay Peak case.
“If the government wanted to charge any of these people as co-conspirators, indicted or otherwise, they could have done so,” Rubin said.
The government did not, he added.
Federal prosecutors, through a spokesperson, declined to comment.
Stenger and his one-time business partner, former Jay Peak owner Ariel Quiros, along with two of their associates, were indicted in May 2019 on charges of fraud and providing false statements to the government.
Quiros and William Kelly, a key adviser to and longtime friend of Quiros, were both named in the same indictment as Stenger and have since reached plea deals. Stenger has maintained his innocence and is set to stand trial in October.
A fourth defendant, Alex Choi, remains at large. Choi was allegedly behind a fraudulent stem cell research scheme in South Korea.
The U.S. Attorney for the District of Vermont brought charges against the four defendants in connection with a failed project to build a $110 million biomedical research center in Newport, known as AnC Bio Vermont, financed by foreign investors through the federal EB-5 visa program. The project was never built.
The Vermont biomedical facility was a carbon copy of Choi’s AnC Bio Inc., based in Pyongtaek, South Korea. That company was also allegedly used to defraud foreign investors. In September 2013, the Korea Herald reported that Choi was arrested and released on bail on charges of stock manipulation, corruption and embezzlement of $10 million from AnC Bio Inc.
Monday’s filing includes the following names of people whose statements federal prosecutors allegedly told Stenger’s attorneys could be admissible under the co-conspirator rule:
— Ike Lee, a stem cell researcher who worked for Choi at the South Korea facility, is the former CEO of AnC Bio Vermont. In a 2015 press conference with Vermont media, Lee told reporters that the Newport biomedical facility would create 400-450 high tech jobs.
— Jake Lee, no relation to Ike Lee, ran the AnC Bio business in Korea and became the head researcher for AnC Bio Vermont. He is described in a letter from Stenger to state officials as a University of Vermont fellow, chief technology officer and head researcher for AnC Bio. Jake Lee rented office space at UVM under the auspices of John Evans, a professor at the College of Medicine and a special adviser to the president of UVM.
— George Gulisano, former Jay Peak chief financial officer, who worked for Quiros from 2010 to 2016. In a deposition with the U.S. Securities and Exchange Commission, Gulisano claimed to have audited the eight EB-5 projects run by Quiros and Stenger.
— Joel Burstein was Quiros’ broker at Raymond James & Associates Inc. in Florida and was Quiros’ son-in-law at the time. He has agreed to an $80,000 settlement with the SEC to resolve a civil enforcement action related to the case.
— Candice Campbell was a project consultant for AnC Bio Vermont. Her LinkedIn profile states that she assisted “in establishing the FDA approval protocols for the AnC Bio Vermont business.”
— Deborah Wong was the team leader for a Frost & Sullivan marketing study of AnC Bio Vermont that supported the developers’ assertions that the biomedical facility would generate hundreds of millions of dollars in revenues. The report, commissioned by Jay Peak, asserted that organ replacement devices to be manufactured at AnC Bio Vermont would not only be highly competitive in the global market, but also would be “leaders in setting new standards for the industry.” As such, they would help AnC Bio Vermont become one of the first leading-edge stem cell research manufacturing facilities in the world, according to the report.
— MacLean, a two-time campaign manager and longtime aide to Gov. Peter Shumlin, left her position in state government to serve as a consultant to Jay Peak and Stenger. MacLean traveled overseas to solicit investors, handled press inquiries and produced a promotional video for Jay Peak that quoted Shumlin erroneously asserting that the Jay Peak projects were audited by the state. Brent Raymond, former director of the Vermont Regional Center, which was run by the commerce agency, said in a deposition last year that MacLean warned him to stop asking questions about AnC Bio.
Stenger’s legal team isn’t just seeking to bar admission of statements by those witnesses under the co-conspirator rule. In Monday’s filing, the lawyers also sought to block testimony related to the resolutions of civil actions brought against Stenger by state and federal regulators for actions related to Jay Peak.
Stenger has reached monetary settlements in both of those cases, neither admitting nor denying guilt. He settled the federal case for $75,000 and the state case for $100,000.
In both civil actions Quiros and Stenger were accused of misusing $200 million of the more than $350 million they raised from foriegn investors through the EB-5 program to pay for a series of projects over nearly a decade in Vermont’s Northeast Kingdom.
Those projects included major upgrades to Jay Peak Resort and Burke Mountain ski area, including new hotels.
The civil actions brought in April 2016 ground to a halt the proposed biomedical research center in Newport. Though the developers raised more than $80 million from more than 160 EB-5 investors, the project never got off the ground and has been termed by regulators “nearly a complete fraud.”
In all, the developers were accused of misusing more than $200 million in investor funds from eight projects.
Foreign investors who put at least $500,000 into a qualified project through the EB-5 visa program were eligible for U.S. residency, provided the development met job-creation requirements.
The immigration status of more than 400 of the 800-plus investors in the projects was left in limbo as a result of the fraud allegations associated with the developments.
In Monday’s filing, Stenger’s attorneys also sought to bar additional testimony from his trial:
— Statements from witnesses alleging that Stenger lied or tried to mislead them. Witnesses, according to the filing, could state what Stenger said, but they are not allowed to “discern Stenger’s intent to deceive.”
— Testimony that Stenger was exaggerating Ike Lee’s participation in the AnC Bio Vermont project and that he wanted investors to think Ike Lee played a more active role in the development.
— Certain statements from investigators. Government agents’ testimony should be limited to what they did to investigate the alleged fraud and should not include summaries of what other people told them.
MacLean did not return phone messages Monday seeking comment.
Thomas Sherrer, a Vermont attorney representing Jake Lee, declined comment when contacted Monday. John Campbell, a Florida lawyer for Gulisano, also declined comment Monday.
Current contact information for Ike Lee and Deborah Wong was not immediately available Monday. An attorney believed to be representing Ike Lee did not return a call seeking comment.
Calls to numbers believed to be for Candice Campbell and Burstein were not immediately returned Monday. A lawyer believed to be representing Campbell also did not return a message seeking comment.