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February 2, 2011

FCR, according to Wall Street Journal, has gotten $249M commitment in EB-5 funds; video of project pitch shows more lies, Markowitz mugging for camera

Atlantic Yards Report

Some four months after planting news in the Wall Street Journal regarding efforts raise $249 million from immigrant investors seeking green cards, developer Forest City today tells the Journal--well, it's sourced to "people familiar with the effort," who won't go on record--that 498 investors have committed the $249 million sought.

The news is slipped in an overview of the recent popularity of EB-5, headlined Help Fund a Project, and Get a Green Card: Once-Obscure U.S. Program Provides Alternative Financing for Developers, but New Flood of Interest Raises Concerns.

FCR's success is not surprising, given the popularity of basketball in China, the number of Chinese millionaires seeking green cards and the tendency in China, apparently, of doing little due diligence on such EB-5 immigration programs.

Failure of oversight

What is surprising is the failure of the Wall Street Journal, and the U.S. Citizenship and Immigraiton Services, the federal agency that oversees EB-5, to look closely.

After all, Reuters in December nailed the New York City Regional Center (NYCRC), the private investment fund pitching the project, on several misrepresentations:

  • that investors need not worry about getting green cards
  • that investors would be financing a new arena in Brooklyn for the National Basketball Association's Nets
  • that the government of New York State is involved in the project being presented

And while the NYCRC blamed its foreign agents, I pointed out that such lies, and other misrepresentations, were at the heart of the pitch presented in an NYCRC video and by NYCRC staffers.

Click thru for much, much more.

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Posted by eric at February 2, 2011 11:18 AM