Quiros denies Ponzi architect charges

The Miami businessman told the SEC everything could be explained

by Mark Johnson

April 23, 2016

This is part of a two-part series. Read part one.

To Ariel Quiros, his purchase of Jay Peak was a stroke of genius.

To the federal government, it was where the eight-year Ponzi scheme he orchestrated began.

In 2008, the Canadian owners of Jay Peak wanted to sell. The family patriarch had died and no one wanted to take over. Finding a buyer was difficult. They thought they had a deal with Korean investors but that fell through. Everyone, Quiros said, the locals, the state’s politicians, including Gov. Jim Douglas and Sen. Patrick Leahy, pleaded with him to buy the mountain.

Quiros was reluctant.

He knew Jay Peak well. He had visited frequently while growing up in Harlem — his dad was a Greenwich Village chocolate maker — and on high school trips when he got a soccer scholarship to an elite prep school, Trinity Pawling, two to three hours outside the city. His father, Venezuelan, his mother from Puerto Rico, Quiros is the youngest of four brothers —  a psychologist, an economist, the other killed in Vietnam.

For the last 30 years, he’d spent every Christmas in Jay, where he’d acquired several properties. But Quiros didn’t have any interest in buying the mountain, didn’t know how to run a resort, and didn’t like doing business in the United States.

Operating out of Miami, his business dealings centered on exporting wire and cable to South Korea, where he’d served in the U.S. Army and met his wife. Their children were born while Quiros was assigned to Spandau prison in Berlin, where he guarded war criminal Rudolf Hess. Their son, Ary, ran Q Burke Mountain Resort, which was taken over by a federally appointed receivership recently; their daughter, Nicole, is an accountant. Her former husband, Joel Burstein, was Quiros’ account manager at the Florida brokerage firm where the investor funds flowed through.

But the asking price for Jay, starting at $40 million, kept coming down and Quiros said the pressure kept increasing “every day, every day.” He got the price down to $23 million, but even better, Quiros told federal authorities, he figured out a way to pay for the mountain using other people’s money.

“If you think about what I did and how I did it, you guys are going to say Quiros you’re a genius,” he told the SEC lawyers in Miami last September. A year earlier in May, in their first session, he told the feds they’d understand it was all legal after “teaching” them what he’d done.

“I’m very proud about my project. I’m very proud of what I did. I’m very proud how I did it. It’s a matter of teaching and showing you guys what I did, is my pleasure, it truly is my pleasure,” he said in 2014. “I want you guys to know as much as you can. And I think in the end, everything will be explained. But it has cost me a lot of headaches.”

To Quiros, everything about the Jay Peak purchase — as well as how the $350 million he and partner Bill Stenger raised through the EB-5 foreign investment program was later handled — was all perfectly kosher. Did it by the book, Quiros said, with a team of accountants and lawyers. Claiming otherwise, that he used investor funds improperly, is “one hellacious false statement.”

To the Securities and Exchange Commission, a slew of the financial transactions by Quiros and Stenger starting in 2008 brazenly violated securities laws. Among the allegations, they used funds raised for later EB-5 projects to cover costs, overruns or investor payouts on earlier projects. They were also accused of improperly mixing together funds from the eight different projects when they were supposed to keep them separate, and in the case of Quiros, the feds say he siphoned off $50 million of the $350 million for personal use. Throughout, they say the two made misleading statements to investors, didn’t disclose critical information, and as a result, have put some investors’ money and green cards at risk.

During the 12 hours of questioning, the 59-year-old businessman alternates between complaining and complimenting the SEC attorneys. He happily lays out in specific terms how he did the transactions, acknowledges moves that appear to be clear SEC violations, at times seeming to concede he broke the rules. But just as quickly, he waves off that admission and insists what he did was perfectly fine and approved by his lawyers and accountants, don’t worry, the money’s all accounted for and all the projects will get built.

By the end of the SEC questioning last fall, however, Quiros’ mood is less boastful than when he describes the Jay Peak deal. He complains the two and a half year investigation — “this ridiculous thing here” — has prompted a series of financial institutions to cut ties. The firm he used throughout, Raymond James — his son-in-law Joel Burstein was his broker — has recently shut him down with little notice, he says, and ordered he pay back immediately $19 million outstanding on his margin account.

Video of Quiros’ broker and son-in-law Joel Burstein:

Quiros then admits to the lawyers that he used investor funds raised for AnC Bio Vermont, one of the last two EB-5 projects, to pay off that loan, but says, like other transactions the feds allege were wrong, he found a way to do it legally. And don’t worry, he tells them, that project will get built. You have my word. The feds in allegations said that project, with three-quarters of the money raised and barely a shovel in the ground, was a total fraud with no chance of being completed.

At one point, Quiros complains the SEC probe has scared away so many financial institutions he had to tap a high school friend to open an account at Merrill Lynch. Then moments later, Quiros compliments the feds, says he welcomes the probe and promises to help. “Whatever I can do…I’m just two blocks away. Call me. I’ll come. I’ll do whatever.” Please, just expedite the process.

Quiros told the feds he asked Stenger to tell Sen. Patrick Leahy not to worry about the SEC investigation.

The two interrogations also shed light on Qurios’ relationship with several key associates, including Stenger, his partner, who, he says, is always sunny like “it’s like Merry Christmas, hello.” Quiros blamed Stenger and another associate, Douglas Hulme, for cost overruns on two early projects, including the one involving the popular waterpark, costs he said he covered from his “profits.”

At one point, Quiros is so angry at Stenger he takes back the handshake deal for a 20 percent stake in Jay Peak Mountain, but later changes his mind and agrees to give Stenger 20 percent of Jay’s profits. In a more charitable section, Quiros says Stenger is so respected he could be elected governor. “It’s just a matter of him saying yes. They will elect him tomorrow morning.” At another point, he portrays Stenger as a dupe who was “outwitted” by Hulme.

When Stenger and Hulme found out how he financed the Jay Peak purchase, Quiros said the two “went crazy.” However, Quiros also said repeatedly that Stenger was aware of the details of what he was doing with the investor funds throughout and knew Quiros was borrowing against the “cross margin” account. He said Stenger regularly initiated or approved financial transfers of investor funds to Quiros’ myriad accounts, which all served as collateral for his main account.

Quiros saved his harshest words for Hulme, an immigration adviser who helped investors deal with customs and immigration paperwork. Hulme broke off relations with Quiros and Stenger in 2012 with a stinging public rebuke of their business practices. The effect, Quiros said, was “devastating,” and made it difficult to raise more money from foreign investors. During the deposition, Quiros calls Hulme a thug, a tyrant, a bully and a gangster and says after the feds close their case, he will track Hulme down and kill him.

“It’s terrible what that son of a bitch did. I will — when this SEC gets over with, I’m going to go over after that man, I promise you. I will kill that man for what he did,” Quiros said.

He says he kept a “black book” on Hulme and Stenger, and “not to throw Bill under the bus,” but he was “outwitted” by Hulme on several occasions.

How the alleged Ponzi-like scheme was perpetrated

According to federal and state officials, the methods that Quiros used to purchase Jay Peak were similar to the ones he and Stenger are alleged to have used over the next seven years to keep the “Ponzi-like” scheme going over eight different projects in the Northeast Kingdom.

Five of the EB-5 projects have been completed, two are partially complete, one is barely off the ground. In the case of the last one, AnC Bio Vermont, officials, including Gov. Peter Shumlin, say there is little chance now that it will ever be completed. More than three-quarters of the money was raised, but little work has been done and the authorities say it was essentially a complete fraud.

The Ponzi-like scheme began, according to the SEC, with the 2008 purchase of Jay Peak from Mont Saint Saveur International, Inc. of Canada.

The SEC says Quiros unabashedly used investor funds for two future EB-5 projects at Jay Peak to pay MSSI, even though the former owners explicitly warned him not to do so. Stenger had been raising money for two future projects since 2006. The SEC says after depleting most of those EB-5 accounts to pay the old owners, Quiros backfilled them with Treasury notes, which he bought using other EB-5 investor money improperly as part of the collateral.

Quiros claimed to the feds he used only a portion of the EB-5 investors’ monies, funds he claimed he was owed, but he struggled to explain when the feds pointed out he used almost all the money in the accounts before replenishing them with T-bills that he paid for by borrowing against his account and using other EB-5 money to back up those loans.

That practice —  converting the $500,000 investments from foreigners into Treasury Bills, and then borrowing up to 90 percent of their value to pay for other projects and Quiros’ personal use — would be a pattern that would be repeated over and over as Quiros and Stenger tried to keep financially afloat, according to the feds, and violated securities laws and investor agreements.

In addition, another way Stenger and Quiros were able to keep going financially was to take out the hefty management fees — 20 percent — and other costs they were due on the half million dollar investments as soon as the money came in. They then used those funds to pay off earlier projects.

The feds also allege Quiros and Stenger regularly and improperly mixed money from several EB-5 projects together. Quiros said he kept the money in separate accounts, but he also talked about keeping the investor funds over the years in two “buckets” divided between the early projects and later ones, some involving downtown Newport.

He also told regulators about using a “one window system” where all funds, including EB-5 investments, all went through Q Resorts, the company he established to buy Jay Peak. He later used investor funds to purchase Burke Mountain Resort.

“So I can control and see,” he told the feds. “I wanted to see through one account where all the money went, how did the money flow.”

He fully admitted that investor funds, once they were converted into T-bills, were all used as collateral for his master “cross margin” account that he borrowed against. He seemed to believe that if he turned the investor funds into Treasury bills that he was not technically using them. He acknowledged investor funds could not be used as collateral, but again, appeared to believe once they were converted that their status changed. He also repeatedly pointed to the management fees and other costs, such as land purchases, that could be taken out of the investment funds and used immediately.

Frequently, Quiros referred to the $500,000 investments as “my funds” until corrected by the government lawyers.

“I clearly understand what you’re trying to get at. Whatever funds were consumed were my funds, number one,” he said. “But you keep on referring to investors’ funds. I did not use investor funds. Whatever funds I took into my account, I had full control, and it was my funds, my corporate funds.”

He continued: “Instead of saying investor funds, it’s hard for me to agree with you, because some of those investor funds belonged to my company. Some of those investor funds belonged to Q Resorts. Some of those investor funds belonged to the investors. And some of those investor funds belonged to vendors that had already contracted out the work prior to my purchase. So I’m understanding what you’re saying. I think now I clearly understand. What everybody’s trying to get at is that I used other people’s money to buy Jay Peak, and that is one hellacious false statement, very false statement. I can show that, and I’ve shown that with documents. But you’re asking me here, and I will address it to you because I want it to be so clear.”

According to federal and state regulators, Quiros and Stenger misused $200 million, more than half of what they raised. The money, the feds say, was “flowing in a circular and roundabout manner among various accounts and entities.”

The feds said the misuse started with the Jay Peak purchase and extended all the way to the latest, the AnC Bio Vermont project.

When Raymond James told Quiros they were shutting down his accounts in 2014 because of the SEC investigation and needed him to pay off the $19 million he owed, the feds said he used funds raised from AnC Bio Vermont (also called Jay Peak Biomedical) to close out the account.

Burstein, divorced from Nicole Quiros in 2010, testified how the margin loan was paid off.

“He and his accountants and his lawyers decided that they would take it from the Jay Peak  Biomedical account, and they sent it to People’s Bank. People’s Bank sent it to the Jay Construction account. And the Jay Construction account paid down the margin,” Burstein told the lawyers.

“And about how much was paid down?” the SEC lawyer asked.

“Nineteen million, I believe,” Burstein said.

Quiros had a different view. He admitted using investor money but claimed the funds were available when he put off a $21 million obligation to a Korean firm for equipment to be used for AnC Bio Vermont, the biomedical center in Newport.

“I had to pay Raymond James. That would have been the sabotage of my company if I didn’t pay them down,” he testified. “So I paid them down. It’s funny. They’re the ones who designed this whole program, but they forced me to pay them down. So be it.”

Earlier, he described how the Raymond James accounts were set up for the Jay Peak purchase and the idea of converting the $500,000 investments into Treasury notes came about.

“I went to a lot of banks, but the last stop was Raymond James,” he said. “They said Quiros, this is easy, we’ll put this together, put these money in Treasury bills, you’re safe. Don’t touch — I told them, you can’t touch it. I can’t sleep. I’m military. Don’t play with me. No stocks. No nothing. I want Treasury bills. And we’ll work off this, off the margins. I said, fine.”

Burstein testified he felt his obligation ended when Quiros said all of his transactions had been approved by attorneys and accountants. Raymond James didn’t want to hold EB-5 money in escrow.

“We can buy Treasury bills. I can give a corporation margin. Those are things within the realm of what I know and what I do,” Burstein said.

“We were not about to just delve into the intricate world of Customs and Immigration, EB-5, foreign investors from random countries, escrow accounts, you know, subscription agreements,” Burstein continued. “That’s beyond our scope of, of what our knowledge base was. And so we made a conscious effort to say, we’re just going to be your asset manager.”

Quiros told SEC lawyers he put off paying the debt for Korean equipment in order to settle the margin account in March 2014, but he had every intention of paying the Koreans from future investors’ money. The AnC Bio Korea headquarters was sold in a liquidation auction in May 2014.

“I wouldn’t do that to the Koreans. I made a deal with them, and I will do the deal with them. And they will get their $21 million, and they will get all of the promises that I made to them for which they gave me all of the patent rights and the distribution rights here in the United States,” he said.

AnC Bio Vermont, he insisted last fall, would still become a reality.

“I haven’t failed in eight projects. I’m not going to fail on this one. That’s the best way I can describe it,” Quiros said.

And the sooner the investigation could be completed, he said, the sooner he can get back to business.

“I would just like to alert you that the SEC is hindering me from doing my work. I’ve been successful for the last eight and a half years. I haven’t failed one project. And I have built out all of the projects that had to be built until now. I haven’t failed once,” he said.

Quiros told investigators he had a net worth of $200 million.

He continued: “I do want to tell you that I respect the work that you’re doing. I welcome your work that you’re doing. But please do whatever you can to expedite this thing, so that I can bring this to a conclusion. I got to get to my banks. I got to get to my resources. A lot of people out there think bad about me. That’s okay. That’s not a problem. So that’s to me, the most important thing I can tell you.”

In a Ponzi scheme, funds from later investors are used on earlier projects, typically leaving those later projects short if more investors can’t be found.

According to Vermont financial regulators, work to varying degrees remains on three of the eight EB-5 projects and there are insufficient funds to complete them. And with the charges filed, Quiros and Stenger are prohibited from raising more funds and would be facing huge hurdles if they could.


The following projects have not been completed: According to the state, the misuse and misappropriation has left a gap of at least $60 million on the last three projects between what the developers promised and the amount they were allowed to raise.


    • Stateside — The hotel has been completed and construction has begun on the 84 cottages, but little to no construction has occurred on the guest recreation center and no construction has begun on the medical center. The estimated total cost for those uncompleted projects was $32 million. That project is fully subscribed. Quiros said he planned to use Jay Peak profits to pay for the rest.
    • AnC Bio Vermont/Jay Peak Biomedical — Site preparation began last April, but construction has not begun. More than $73 million was raised and the state says $42 million was spent and that there are irregularities in the figures claimed by the developers.
    • Q Burke Mountain Resort — Construction of the hotel and conference center is complete, but has not been opened to the public. Construction has not begun on the tennis facility, aquatic center, or mountain bike park.

This is part of a two-part series. Read part one.

  • Roberta Dubrowsky

    Great work Ann…..f3KkL

    • David Matthews

      An exceptional article with an incredibly sad ending along a countless variety of fronts

  • Jamie Carter

    Is there a link to the questioning documents, as there was with the Carpenter deposition? I’d like to read the whole line of questioning, especially more on

    “When Stenger and Hulme found out how he financed the Jay Peak purchase, Quiros said the two “went crazy.””

    It seems at points Quiros is saying Stenger didn’t know, was duped and wasn’t on board. In looking at who bears what cupability it would be interesting to read the whole line of questioning.

    • Annette Smith
    • Walter Carpenter

      “It seems at points Quiros is saying Stenger didn’t know, was duped and wasn’t on board. In looking at who bears what cup ability it would be interesting to read the whole line of questioning.”

      Ann and the digger have done a fantastic job on this saga. Do I see a pulitzer prize in the dig’s future?:)

      Anyway, the idea that Stenger “didn’t know,” seems a little out there in space. It would be interesting to see the whole line of questioning and this line is probably going to go much farther as well.

  • Tim Daley

    Excellent window into the mind of this guy !

  • ray koliander

    what year was Steiger named Vermonter of the year? How does Vermont get that award back?

  • Charlie Bucknam

    It is so refreshing to see examples of real, in depth, reporting. Thank you, Vt Digger!

  • Steve North

    I’d like to know more about the Jay Peak purchase by Quiros that supposedly got this whole train started. The story mentions two projects Stenger had been raising money for starting in 2006. What were those projects and how did they fit in with Quiros and the Jay Peak purchase exactly? The story also mentions the Canadian company selling Jay Peak warned Quiros not to use those funds to buy their resort. What did they know and how did they know it and if they knew about it why did they let the sale go through and expose themselves to that potential liability?
    Another stunning reveal into the tawdry, corrupt world of politics and those we elect to represent us. I don’t care which letter is next to their names either. And it only seems to be getting worse.
    Big thanks to Vtdigger for fleshing this out.

  • Pam Ladds

    Thank you Anne for a truly depressing timeline of wishful thinking, incompetence and outright fraud! Not only did we apparently blow off whistle blowers along the way and malign their characters we also allowed death threats to be made to Mr. Hulme. Was he even made aware of this? And how is this particularly vile form of bullying going to be dealt with.? The pathology evident in the accused (Quiros) and the stupidity and naivety displayed by the rest of the players is just plain sad!

    “Quiros saved his harshest words for Hulme, an immigration advisor who helped investors deal with customs and immigration paperwork. Hulme broke off relations with Quiros and Stenger in 2012 with a stinging public rebuke of their business practices. The effect, Quiros said, was “devastating,” and made it difficult to raise more money from foreign investors. During the deposition, Quiros calls Hulme a thug, a tyrant, a bully and a gangster and says after the feds close their case, he will track Hulme down and kill him.

    “It’s terrible what that son of a bitch did. I will — when this SEC gets over with, I’m going to go over after that man, I promise you. I will kill that man for what he did,” Quiros said.

    He says he kept a “black book” on Hulme and Stenger, and “not to throw Bill under the bus,” but he was “outwitted” by Hulme on several occasions.”

    We do not learn apparently!!

    • Julia Purdy

      Keeping a black book, getting even, threats to do harm, it’s all gangster talk. straight out of the movies. Are we here in Vermont–are our leaders–so desperate that we overlook the glaringly obvious? Where has our Yankee common sense gone?

    • walter moses

      What is with this man? Are we dealing with QMurder inc.?

  • Willem Post


    A great report of Vermont’s sordid EB-5 sage from about 2008 to the present.

    Vermont may be a leader by having set a record regarding misuse of $200 million out of $350 million.

    There likely will be hundreds of unhappy East Asian multi-millionaires, who have many contacts, who will spread the news not to trust Vermont’s politicians and businessmen, i.e., a risky place to invest and do business.

    This likely will have implications regarding future economic development in Vermont.

    Businesses, in-state and out-of-state, will be more reluctant to invest in Vermont’s near-zero-real-growth economy, which will affect already-struggling households and businesses.

    Vermont’s ill-conceived dreams of expensively and ponderously fostering and subsidizing “private/public partnerships” has obtained a major black eye.

    Those subsidized entities end up near-permanently “on the dole” and rarely have any profits to pay local and state taxes.

    ACCD, with help of governors, senators, etc., was good at the “dog and pony” shows to raise EB-5 funds, but exhibited total ineptness and callous disregard regarding oversight, even after being confronted with EB-5 wrongdoings.

    This was not unexpected, because state workers have little or no experience monitoring/overseeing complex EB-5-inspired, subsidized businesses.

    As a result of that lack of experience, they shy away from monitoring/overseeing.

    To combine boosterism and oversight within ACCD is, by definition, laying the groundwork for conflicts of interests; people with MBAs learn not to do this in Business Management 101.

    Centralized, state-controlled managing/monitoring of Vermont’s education, healthcare and energy sectors is similarly complex, and well beyond Montpelier’s capabilities.

    All that would be much less expensive and less ponderous, if left to private businesses and local control.

    • Julia Purdy

      Like the victims of Bernie Madoff, our eyes were bigger than our stomach. Now we’re choking on it. Enough of grabbing for the brass ring, enough of gambling with Vermonters’ hopes and tax dollars! Crooks and con men can spot a gullible mark a mile away. We were it. Enough! Let’s trim the ship and get down to the people’s business.

  • Julia Purdy

    This may be beside the point here, but I can’t help noticing how Ariel Quiros’s way of speaking mirrors Donald Trump’s way of speaking. Short simple sentences. Simple words. Repeated phrases. Leading the listener gradually to agreement by starting with the little things. Grand claims. Blaming the “bad guys.” Gangster-talk. No doubt many in the NEK are cheering for Trump because to them he has “beat the system.” Trump and Quiros are two peas in same pod, make no mistake.

  • Bruce S. Post

    “Everyone, Quiros said, the locals, the state’s politicians, including Gov. Jim Douglas and Sen. Patrick Leahy, pleaded with him to buy the mountain.”

    In most cases, you can’t literally “buy the mountain.” You can buy the businesses at the base of the mountains and any specific land associated with that business. Many of our ski resorts use extensive amounts of state-owned land and lease that land for their lifts, etc. Doug Hoffer pointed this out in a superb report last year or so. Here is a link to a video, wherein he gives a great overview of these leases. You can clearly see the extent of the land owned by the State of Vermont at each of the resorts covered:

    [youtube https://www.youtube.com/watch?v=8QwnGeEoy2U&w=560&h=315%5D

    As the resorts have grown and prospered, they are benefiting from long-ago negotiated leases that, today, amount to sweet-heart deals between the State of Vermont and the corporate entities that run the ski areas. And, of course, it is a misnomer to call them “ski areas”; they are sprawling real estate developments in sensitive mountain terrain, something that does not seem to bother the politicians who keep boosting their amoeba-like expansion.

    Just one more example of the crony capitalism that exists in Vermont as elsewhere.

    • Obviously, “buy the mountain” is a figure of speech. If Quiros’ characterization of these politicians “pleading” with him were true (not likely), they would have done so with the enhancing of the NEK and general Vermont economy in mind.

      • Erik Timmerman

        It seems like he may have thought he really could buy the mountain. After all, he did ask the State of Vermont to rename Burke Mountain QBurke Mountain. Not just the resort, the actual mountain.

    • Wendy Wilton

      Not all VT ski resorts are on state land. For example, Pico mountain is owned by Powder LLC, while neighboring Killington is leased from the state by Powder.

  • John Freitag

    Anne and Mark,
    This is one of the best, most thorough pieces of investigative journalism in Vermont that I have seen in over 40 years. Congratulations at doing the digging needed in this extremely sad and troubling story. We are in your debt.
    One can only hope that our politicians stop trying to pass the blame and accept some responsibility for this fiasco in which they all had a part and do some real soul searching on what went wrong and how it should not happen again.
    My fear is that three or four years down the road we will be facing a similar crisis with the largely unregulated large scale commercial renewable projects pouring into our State. Like the EB-5 program massive commercial renewable development seem to many politicians to be the right thing to do, and here too there is also a good deal money and campaign contributions involved. Yet, the long term consequences of this developmental rush have not been determined, and the oversight needed is simply not there. I hope I am wrong, I suspect I am not.

  • Rita Pitkin

    Thank you for pulling this all together in one place and for all of your genuine hard work at digging out and into this story. Journalism at its very best.

  • todd spayth

    This is my understanding from what I read. If I’m wrong, maybe somebody can clarify for me….This appears to be a “walk on” for Quiros. He is somehow given access to EB-5 funds already in account for Jay Peak expansion under former owner before actually paying a dime to acquire JP. He then “washes” that money through his spaghetti factory, giving him access to CASH that he uses to affect the actual purchase of JP. Is that it? I believe I read that the seller advised him NOT to do this but, knowing he did, accepted the payment and went on their merry way. Quiros has got stones, I’ll give him that!

    • You make a good point or question about the funds. I have not read the testimony, but from this article, it is my understanding that Quiros was bringing the EB-5 money to the table. As far as “stones”, I understand what you are saying, but a better word would be gall. He found a temporary weakness in the system and devised a confidence scheme. He is now blaming everyone else for his troubles. Sounds like a spoiled cry-baby to me.

  • Michael C. vinton

    Sure sounds like someone in Vermont state government either was a sleep on this problem, OR? This is a big blow to The NEK, someone (Stenger) should buy a RV and leave Vermont, he will not be missed.

    • Willem Post


      ACCD and DFR have a staff of about 40 state functionaries, plus others in other departments to help out, as needed. A budget of about $6 million, at $100,000/worker (salary, benefits) plus overhead.

      One would think, some of them would be available for boosting and overseeing the out of control EB-5 program.

      There was a lot of boosting, but near zero, effective oversight.

      The state should get out of the subsidizing business. It breeds insider dealing and fraud, and poisons the initiative of the private, entrepreneurial sector.

      • Wendy Wilton

        I read in another article that under EB5 regs the state was supposed to get quarterly progress reports and the projects were to have annual external audits performed. Neither one of those things was required by ACCD or he state. Lawrence Miller and his staff, it appears, were either not capable of following the regs or the law, or they were told to back off. A decent CPA would have seen these problems in 2012 if they had a chance to look at the bank statements.

  • This is journalism in its finest “state.” Thank you. Your work will have a profound effect upon the nature of Vermont politics and government…one can hope for the better.

  • Book of Proverbs, 16:18, “Pride goeth before destruction, and an haughty spirit before a fall.”

    In my personal experience, Vermont is no less and no more prone to incompetence and corruption than any other state. However, many of us have an issue with Vermont telling itself it is “special”. Thinking corruption and vice or drugs and bribery is a problem for other states to worry about may cause us to react more slowly and with less diligence to the scent or appearance of impropriety. And it’s not usually the crime, but slow reaction or cover-up, which demands the political price. In that regard I gave the Governor high marks for coming out publicly on the opiate problems. We just need to see more admissions that certain state officials are out of their depth as they try to negotiate creative deals with taxpayer vouchers.

  • It is difficult, from this article, for me to understand when this SEC testimony was taken and why they would not in turn prevent further theft and misappropriation of EB-5 funds.

  • Tiki Archambeau

    It seems reasonable to believe that a class-action lawsuit against the state is only a matter of time.

    The state will have a hard time defending against the fact that its oversight responsibility was in direct conflict with its promotional responsibilities. Add the fact that our esteemed political leaders helped sell it with Vermont’s surety and we’re looking at a liability our legislature ought to be budgeting for now.

  • Joseph Brown

    So it appears Quiros was Edgar Bergen while Bill Stengler was Charlie McCarthy. All while the gallant State of Vermont cast a blind eye! Great!

  • Robert Meerdahl

    “In a Ponzi scheme, funds from later investors are used on earlier projects, typically leaving those later projects short if more investors can’t be found.”

    no, a Ponzi scheme is where funds from later investors are used to pay artificially inflated returns to earlier investors