susan donegan

Recent Posts

Raymond James settles with Vermont for $5.95 million

MONTPELIER — The state has reached a $5.95 million settlement with Raymond James and Associates in connection with a massive EB-5 fraud case in the Northeast Kingdom. Department of Financial Regulation Commissioner Susan Donegan announced the settlement with the financial firm Thursday, noting the department found “multiple instances of non-compliance with supervisory requirements and Vermont law.”

“DFR’s responsibility is to ensure that Vermont’s securities laws are followed, and that investors are protected,” Donegan said in a release. “Since the SEC’s seizure of the Jay Peak-related EB-5 projects, investors have been rightly concerned about possible recovery of funds. This settlement contributes to their restitution.”

The settlement follows an investigation and the filing of fraud charges in April against Bill Stenger and Ariel Quiros, the principals of several development projects, including Jay Peak, using the federal foreign investor program. Quiros and Stenger are accused by both the federal Securities and Exchange Commission and the state of misusing about $200 million of the $350 million they raised from foreign investors in $500,000 increments. Continue Reading →

Filed under: , , , , , , ,

Documents show feds were onto Quiros long before state launched probe

ederal authorities launched an investigation into Jay Peak’s EB-5 projects nearly a year before state officials had their first inkling that something illegal was afoot. And documents on file at the Securities and Exchange Commission indicate that the agency had strong forensic evidence of a massive fraud well before the changes in state regulatory oversight that Gov. Peter Shumlin now credits for taking down the “Ponzi-like” scheme. On May 22, 2014, at about 10:30 in the morning at SEC offices in Miami, Florida, federal lawyers grilled Ariel Quiros about a series of financial transactions detailing alleged misappropriation of funds from the foreign investors. The 245-page transcript of their day-long interview reveals pieces of the evidence the SEC would later use to file dozens of federal civil charges against Quiros, the owner of Jay Peak, and Bill Stenger, the resort CEO that federal authorities say facilitated the scam. SEC lawyers conducted that deposition seven months before a memorandum of understanding that shifted the state’s financial oversight of Quiros’ and Stenger’s dealings away from the Agency of Commerce and Community Development, and over to the Department of Financial Regulation. Continue Reading →

Filed under: , , , , , , ,

Federal and state authorities allege massive fraud in Northeast Kingdom development projects

MONTPELIER — The federal Securities and Exchange Commission on Thursday unveiled a civil fraud complaint charging a “Ponzi-like scheme” involving the main actors in major Northeast Kingdom development projects for misusing $200 million dollars of foreign investors’ money, while state officials filed a state-level complaint mirroring the federal charges. Ariel Quiros and William Stenger, owners of Jay Peak Resort and the principals heading up eight different development projects through the federal EB-5 Immigrant Investor Program, have raised $350 million in $500,000 increments from foreign investors seeking permanent residency in the U.S. through the investor program. Federal and state officials on Thursday said $200 million of the money raised was misused, including $50 million by Quiros for his own personal benefit. The eight ambitious EB-5 projects include improvements at Jay Peak and Q Burke Resorts and a biomedical research facility in Newport. According to the state’s civil complaint, filed in Washington County Superior Court on Thursday, the duo used various limited partnership companies to raise the funds. Continue Reading →

Filed under: , , , , , , ,

Donegan: Legal pot market will have difficulties with banking, insurance

MONTPELIER — Vermont Department of Financial Regulation Commissioner Susan Donegan says banking services will be limited if Vermont legalizes marijuana for businesses in the market but it could also present some opportunities for institutions in Vermont. Donegan provided testimony Thursday to the Senate Judiciary Committee, which is reviewing two bills that would legalize marijuana. The federal government still considers the drug to be illegal, however, which has created issues for Colorado and Washington where marijuana has been legalized at the state level. Businesses selling marijuana in the those states have not been able to access the federally insured banking system. How Vermont businesses would fare in a legal marijuana market in the state was immediately raised by Senate Judiciary Committee Chairman Dick Sears, D-Bennington, on Thursday. Continue Reading →

Filed under: , , , , , , ,

Future of Vermont health insurance co-op hinges on re-do

MONTPELIER — When Commissioner of Financial Regulation Susan Donegan in May denied the Vermont Health CO-OP’s bid to become the state’s third health insurance company, she laid out two paths for the embattled organization: Appeal her decision to the Vermont Supreme Court, or begin afresh with a new application. It chose neither. The would-be insurance startup is instead asking Donegan to reopen the docket and reconsider an earlier decision in which she panned not only the CO-OP’s business model but the integrity of the management team that developed it. While the statute governing Donegan’s authority doesn’t stipulate this third option, lawyers for the startup say there’s more than enough legal precedent to justify their request. And while Donegan isn’t commenting on the specifics of the organization’s motion, filed with her office July 3, she said Wednesday that she isn’t dismissing it out of hand. Continue Reading →

Filed under: , , , ,