SEC investigating Kushner Companies’ use of the EB-5 program

SEC investigating Kushner Companies’ use of the EB-5 program

Saturday, January 6, 2018

Jared Kushner with the U.S. Securities and Exchange Commission headquarters in the background. (Credit: DoD Photo by Navy Petty Officer 2nd Class Dominique A. Pineiro, left; AgnosticPreachersKid/Wikimedia Commons)

From TRD New York: The global kerfuffle sparked last year when Kushner Companies’ principal Nicole Kushner Meyer mentioned her brother Jared during a pitch to investors appears to have triggered an investigation from the Securities and Exchange Commission.

The Wall Street Journal reports Kushner Companies received a subpoena in May 2017 asking for information on how the company uses the EB-5 program, the so-called “crack cocaine of real estate financing,” which gives green cards to foreign investors who commit a minimum of $500,000 to American businesses.

Though the specifics of the SEC’s subpoena are still unknown, it was issued the same month as a different subpoena, filed by federal prosecutors from the U.S. attorney’s office in Brooklyn, asking the company for information related to projects using funding generated from the EB-5 program. According to the Journal, the two offices are collaborating.

The nature of the federal prosecutors’ subpoena includes email correspondence for One Journal Square, the embattled $1 billion pair of towers Meyer was fundraising for in Shanghai when her infamous misstep last spring occurred.

Meyer’s sordid pitch was part of a marketing campaign in Beijing and Shanghai with the goal of raising $150 million from Chinese investors –who make up the majority of EB-5 visa recipients– for the company’s One Journal Square project in New Jersey. In addition to Meyer’s controversial presentation, the campaign’s local organizer, QWOS Group, also known as Qiaowai, came under fire for allegedly misrepresenting the program and the group’s ties to the Trump administration.

In response to confirmation of the probe, Kushner Companies recycled a previous statement to the press, originally issued to the Journal in response to the subpoena from the Brooklyn office, denying wrong-doing and cooperation with the legal requests.

Jared Kushner was in charge of Kushner Companies until last year when he was named White House Advisor and subsequently resigned, selling most – but not all — of his stakes in the business. [WSJ] — Erin Hudson

Source: The Real Deal