|
 Two recent reports related to the EB-5 visa program have highlighted the need for potential EB-5 visa applicants to be extremely vigilant and to seek qualified, experienced and independent advice before selecting an EB-5 regional center program. On the pages of this blog we have stressed in the past the importance of carrying out in-depth due-diligence on all aspects of EB-5 visa programs and the people involved in the regional centers and their advisers.
Derick Coles was arrested in May 2011 by agents from the US Secret Service on counts of wire fraud and mail fraud. The fraud included escrow funds relating to EB-5 visa applications. On February 6th 2012 in Tampa, US Judge Whittemore sentenced Coles to six and a half years in federal prison, followed by three years supervised release. In his sentencing the judge called Coles’ crime “one of the most heinous” and noted that “he stole and destroyed dreams”. The prosecutor noted, this was the biggest showing of victims in a fraud case he has ever seen.
On February 8th 2012 it was reported on cleverland.com that a Federal Grand Jury in Cleveland had issued a 34 count indictment against A. Eddy Zai and two others in relation to bank fraud. *Note: None of these charges relate to the EB-5 visa program.
Zai was, also until recently, the majority owner of the Cleveland International Fund (CIF) EB-5 regional center; he is being charged with fraud, bribery, money laundering, conspiracy and making false statements which led to what United States Attorney Steven Dettelbach called “A conspiracy that resulted in one of the largest credit union collapses in history.”
Federal Bureau of Investigation (FBI) Special Agent Stephen D. Anthony said that “This indictment is the result of a lengthy joint investigation between the FBI and the IRS. Zai was the single largest recipient of fraudulent loans and significantly contributed to one of the largest collapses of a credit union in U.S. history.”
| 
