Vermont Settles with Quiros, Stenger over Jay Peak, Burke Scheme
No government officials have been charged for their involvement in the massive EB-5 fraud.
Thursday, July 12, 2018,

Jay Peak

Attorney General TJ Donovan and Governor Phil Scott announced today that the State of Vermont has reached a settlement with former Burke Mountain and Jay Peak owners Ariel Quiros and Bill Stenger.

Quiros will surrender five properties to the state, in addition to the properties he previously agreed to surrender to the Federal government. Quiros was also previously assessed a $1 million fine by Federal government.

Stenger will pay a $100,000 fine, in addition to the $75,000 fine assessed by the Federal government.

The state fines will reportedly be used for development in Newport.

No criminal charges have been filed.

No government officials involved with the EB-5 fraud have been charged or fined.

Patrick Leahy and Bill Stenger
Stenger, a political science major at Syracuse University, started working at at Jay Peak in 1985 and in 2008 recruited Ariel Quiros to purchase the resort from Mont Saint Sauveur International. Following the acquisition, the group's EB-5 immigrant investor proposals expanded throughout the Northeast Kingdom with a planned price tag of $500 million. Meanwhile, Stenger and Quiros started a massive campaign of contributing to politicians, paying for their international junkets, and arranging press conferences and committee appearances to boost investor interest.

A Federal program created by Senator Ted Kennedy and championed by Senator Patrick Leahy, EB-5 allows immigrants to obtain a green card in exchange for investing $500,000 in a government endorsed business that creates ten jobs. In the case of the Jay Peak program, 20% to 25% of the investment was taken by developers and agents as fees.

The SEC took control of the properties on April 13, 2016, alleging that Quiros and Stenger were running a Ponzi scheme that was defrauding investors. The businesses were placed in receivership under Michael I. Goldberg, with Leisure Hotels and Resorts of Kansas City appointed to run the resorts.

A cornerstone of the SEC's lawsuit is the allegation that margin loans were taken out with EB-5 funds as collateral, a strategy that Quiros described in detail. Quiros and banker Joel Burstein both stated that Stenger participated in margin loan conversations.

The resorts remain under control of the government appointed receiver.

  • UPDATE: State settles with Jay Peak developers over EB-5 fraud case - VTDigger External link

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