Largest Fraud Vermont Has Ever Seen Started With a Peak

Vermont's Jay Peak ski resort was for sale, and a Florida man wanted it—and got it. But as Dan D'Ambrosio and April McCullum of the Burlington Free Press describe in a lengthy three-part series, it would only be years later that authorities would determine Ariel Quiros only managed to do that through a shell game that would turn out to be "the largest fraud the state had ever seen." In 2008, Quiros didn't have the means to buy the property, which cost $26 million; that covered the resort but also the $18 million of investor money it had in the bank for expansion projects. Through a series of banking maneuvers, Quiros managed to get the $18 million transferred to him on the day of purchase and then used it to pay the owners for the property. Now he just needed to replenish that $18 million, and he was going to use the EB-5 program to do it.

The federal program is actually how the resort had amassed the $18 million. EB-5 gives foreigners a way to obtain a green card in exchange for investing $500,000 in job creation in economically depressed areas of the US—like the one Jay Peak was in. Quiros and Bill Stenger, the longtime GM of the resort, were lauded by Vermont bigwigs like Bernie Sanders and Patrick Leahy for their plans, which they said involved the construction of a bio-technology plant, hotels, and more. It would bring 5,000 jobs to the region, at zero cost to taxpayers, and using EB-5 they raised more than $400 million to make that happen. Except it was really just "a stream of investor money that could fill in the balance sheet on money that went missing from a previous project." The SEC began investigating in 2013, and Vermont followed suit more than a year later. But everything wouldn't come crashing down until April 2016. (Read the full story for much, much more.)