Coco Palms Hui plans to bring 172 wealthy investors from foreign countries (some of them possibly drug cartel) to Kauaʻi for $500,000 Green Cards. This is CONFIRMED -- see EB-5 application link below. As if the traffic they would cause is not enough!
Miki Miller Coco Palms Hyatt Resort developers solicited investment loans of $500,000 each from as many as 172 wealthy Foreign Nationals, in exchange for automatic Green Cards and a direct path to U.S. Citizenship for these rich investors and each of their family members. This EB-5 Visas are often referred to as “Golden Visas’ for this reason.
This Coco Palms Application, in the link below, shows how $86 million (2/3’s of the budget) for the 12,000 sq.’ Hyatt Resort was being raised through wealthy Foreign Nationals in exchange for Green Cards and a path to U.S. Citizenship for them and their family.
These types of insured $500,000 ‘investment loans’ from wealthy foreign investors are happening all over Kaua`i, Hawai`i, and the United States of America —
“The proposal identifies the new commercial enterprise (“NCE”) of the project as Lexden Coco Palms Loan Company, LLC, which was formed in the State of Delaware on January 31, 2014. The project is located at 4-947 Kuhio Highway, Kapaa, on the island of Kauai in the State of Hawaii. 172 immigrant investors will subscribe to the NCE as limited partners in exchange for capital contributions of $500,000 each and an aggregate of $86 million. The NCE will loan the $86 million of EB-5 capital to a third-party entity, Coco Palms Resort. The EB-5 capital loan proceeds will be used to acquire and re-launch The Coco Palm Resort as the Coco Palms by Hyatt in Kauai.”
Miki Miller The problem is, not even the U.S. Government is able to verify the true identities of these wealthy investors and their families, nor are they actually able to validate where this money comes from. That is why investors a National Security threat for us all. Here is a report from the United States Government Accountability Office —
“The report concluded that because of difficulties ensuring the integrity of the Regional Center Program, USCIS was limited in its ability to prevent fraud or national security threats and could not demonstrate that the program was benefiting the U.S. economy and creating full-time employment as required by law.”
“USCIS has identified fraud and national security risks in the EB-5 Program in various assessments it conducted over time and in collaboration with its interagency partners.”
“Specifically, a senior FDNS official noted that while adjudication of petitions in the EB-5 Program, like other immigration programs, centers on the eligibility of the petitioner, the EB-5 Program also has an investment component that creates increased program complexity and the potential for fraud risks.”
“However, according to USCIS officials, it can be difficult to verify the sources of immigrant investors’ funds and such verification difficulties could pose fraud risks to the program. For example, USCIS officials told us that some petitioners may have strong incentives to report inaccurate information about the source of their funds on their applications in instances when the funds come from illicit—and thus ineligible—sources, such as funds obtained through drug trade, human trafficking, or other criminal activities.”
“USCIS officials said that IPO and FDNS did not have a means to verify self-reported immigrant financial information with many foreign banks. In addition, both USCIS and State officials noted that they did not have authority to verify banking information with many foreign countries. For example, State officials said that because the U.S. government lacks access to many foreign financial systems, there is no reliable method to verify the source of the funds of petitioners.”
“Legitimacy of investment entity - The amount of investment required to participate in the EB-5 Program, coupled with the fact that EB-5 investors are making an investment in order to obtain an immigration benefit, can create fraud risks tied to unscrupulous regional center operators and intermediaries. According to SEC officials, they have identified instances of fraudulent investment schemes, including securities fraud, related to EB-5 investments.”
Miki Miller This ‘Advisory’ from the ‘U.S. Financial Crimes Enforcement Network’ (FinCEN) one of many reasons the Lexden-Coco Palms Loan Company’s statement about their EB-5 Visa program, which allows wealthy Foreign Nationals to receive an automatic ‘Green Card’ for investing in this Hyatt Resort development, concerns me so much —
“Although FinCEN to date has focused on residential real estate, money laundering can also involve commercial real estate transactions.”
“Real estate transactions and the real estate market have certain characteristics that make them vulnerable to abuse by illicit actors seeking to launder criminal proceeds. For example, many
real estate transactions involve high-value assets, opaque entities, and processes that can limit transparency because of their complexity and diversity. In addition, the real estate market can be an attractive vehicle for laundering illicit gains because of the manner in which it appreciates in value, “cleans” large sums of money in a single transaction, and shields ill-gotten gains from market instability and exchange-rate fluctuations. For these reasons and others, drug traffickers, corrupt offcials, and other criminals can and have used real estate to conceal the existence and origins of their illicit funds.”
“FinCEN’s analysis of BSA and GTO reported data, law enforcement information, and real estate deed records, as depicted by the case studies in this advisory, indicates that high-value residential real estate markets are vulnerable to penetration by foreign and domestic criminal organizations and corrupt actors, especially those misusing otherwise legitimate limited liability companies or other legal entities to shield their identities. In addition, when these transactions are conducted without any financing (i.e., “all-cash”), they can potentially avoid traditional anti-money laundering (AML) measures adopted by lending financial institutions, presenting increased risk.”
“Money laundering is a crime orchestrated to conceal the source of illegal proceeds so that the money can be used without detection of its criminal source.”
“Use of Shell Companies Decreases Transparency - Criminals launder money to obscure the illicit origin of their funds. To this end, money launderers can use a number of vehicles to reduce the transparency of their transactions. One such vehicle, highlighted in the below case study, is the use of shell companies. Shell companies are typically non-publicly traded corporations, limited liability companies (LLCs), or trusts that have no physical presence beyond a mailing address and generate little to no independent economic value.Most shell companies are formed by individuals and businesses for legitimate purposes, such as to hold stock or assets of another business entity or to facilitate domestic and international currency trades, asset transfers, and corporate mergers. Shell companies can often be formed without disclosing the individuals that ultimately own or control them (i.e., their beneficial owners) and can be used to conduct financial transactions without disclosing their true beneficial owners’ involvement. Criminals abuse this anonymity to mask their identities, involvement in transactions, and origins of their wealth, hindering law enforcement efforts to identify individuals behind illicit activity.”
“Criminals can use all-cash purchases to make payments in full for properties and evade scrutiny— on themselves and the origin of their wealth—that is regularly performed by financial institutions in transactions involving mortgages. All-cash transactions account for nearly one in four residential real estate purchases, totaling hundreds of billions of dollars nationwide, and are particularly exposed to abuse.”
The entire FinCEN report can be read at this link —
Miki Miller Here is how another Kaua`i resort development is soliciting these EB-5 investment loans to wealthy Foreign Nationals —
Miki Miller As this 2015 column explains —
“WHAT’S REALLY AT STAKE IN THE EB-5 INVESTOR VISA OVERHAUL: HONESTY”
“Through the EB-5 visa program, wealthy foreigners can invest $500,000 to $1 million in development projects and in turn, receive green cards for themselves and family members if the investment can be shown to create 10 U.S. jobs. The program is now up for Congressional reauthorization.”
“The ability to monetize a scarce public asset — access to the United States — has become a gravy train for developers seeking cheap loans, immigration attorneys, China-based migration agencies and federally-authorized investment packagers known as regional centers.”
“The profits at stake prompt deceptive practices — both in marketing investments and claiming job creation — that distort the intent if not the letter of the law.”
“But claiming that EB-5 investments create jobs at no expense to the taxpayer is bogus. It’s also why an expected compromise regarding reauthorization of EB-5 falls short, despite improvements to the program.”
“The green card alchemizes profits. Think about it: As long they get green cards, the immigrant investors don’t really care about interest and will take a 1 percent return. Meanwhile, the entrepreneurs getting the loan are eager to pay the regional center 5 to 8 percent as opposed to 12 percent they might have to pay on the open market.”
“Yes, it’s unseemly that green cards can be acquired so cheaply. And I say cheaply, because remember, investors are not giving up $500,000; they’re just parking it for five years or so, and the major cost is foregone interest and fees.”
“The Government Accountability Office this year concluded that the agency overseeing EB-5, the U.S. Citizenship and Immigration Services, could not validly analyze job creation. After all, projects financed through regional centers don’t require a headcount of employees. An economist’s report, which calculates not only direct jobs, but also indirect and induced jobs caused by spending, can suffice.”
“One of the oddities about the EB-5 program is that the U.S. government is giving out the green cards, but the entrepreneur who puts together the investment gets the money. This scheme seems inefficient and open to corruption.”
“EB-5 represents “corporate welfare” for certain businesses.”
“In a modest reform, the new legislation mandates that one of the 10 required jobs be a direct job, validated with a head count.
“So the EB-5 industry will still benefit from rules that allow them to credit immigrant investors for jobs created by the entire pot of money.”
“In other words, the immigrant investors got credit for jobs financed by public subsidies and government-authorized tax-free bonds, funding that was already in place, not leveraged by the EB-5 investment.”
We have to Wake Up to the reality that this is happening all over Hawai`i — not not only through the Coco Palms Hyatt Resort developers, but Everywhere!
Please support the Hawaiians in their fight to protect their homelands from big developers who are using opaque foreign investment `loans’ to develop their lands and reroute Hawaii’s natural water systems.