US

Feds Investigating Kushner Companies’ Use Of Fraud-Ridden ‘Investor’ Visa Program

Federal regulators are investigating the real estate company owned by the family of Jared Kushner, President Donald Trump’s son-in-law and senior adviser, over its use of a controversial “investor” visa program.

The Securities and Exchange Commission sent the Kushner Companies a subpoena asking for information about the firm’s petitions for EB-5 visas, which allow wealthy foreign nationals to obtain green cards if they invest in job-creating projects in the U.S.

The subpoena, which had not been previously disclosed, was sent in May 2017, The Wall Street Journal reported Saturday, citing people familiar with the matter.

Kushner Cos. makes frequent use of the EB-5 program to raise investment capital for its real estate development projects. The company came under scrutiny last year when it was reported that Jared Kushner’s sister, Nicole Kushner Meyer, was using the family’s connection to the White House in presentations to Chinese investors. In her presentation, Meyer suggested the company was in a position to guarantee approval of the EB-5 applications because Trump was a “key decision maker” in the process.

Whether the SEC subpoena identifies specific Kushner Cos. projects is not clear at this time. A separate subpoena sent by federal prosecutors in New York concerned a Jersey City, N.J., development of twin, 66-floor towers called One Journal Square, TheWSJ reported.

Created in the 1990s, the EB-5 program gives foreign nationals permanent residence and eventually U.S. citizenship if they invest a minimum of $500,000 in job-creating projects in places with high unemployment. Critics say it has become a way for wealthy foreigners to buy U.S. citizenship while financing projects that have dubious job-creation value or are located in already thriving areas.

The program is also susceptible to massive fraud schemes. In several cases in recent years, U.S.-based real estate developers have collected hundreds of millions of dollars from unsuspecting foreigners for projects that never materialize or were outright fabrications from the start.

Chinese investors dominate the EB-5 program — roughly two-thirds of the 10,000 investors visas issued in 2016 were given to Chinese nationals.

Jared Kushner ran the family business until the presidential election in 2016. After joining the Trump administration in an official capacity, he resigned from the company and sold some of his assets to family members. However, Kushner retains a stake in part of the company, according to his financial disclosure forms.

In a statement to TheWSJ, a spokesperson for Kushner Cos. referred to the company’s previous comments on the federal EB-5 inquiry:

“Kushner Cos. utilized the program, fully complied with its rules and regulations, and did nothing improper. We are cooperating with legal requests for information.”

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