Spotlight on EB-5, the “crack cocaine” of real estate financing

How developers and middlemen use the popular visa program to get rich

Apr.April 06, 2016 12:00 PM

From the New York April issue: Howard Michaels, the tough-talking New York City finance broker, shot off an email in 2014 to his client Michael Shvo.

Michaels, who heads the Carlton Group, had just gotten off a long phone call with Nicholas Mastroianni II, the head of the U.S. Immigration Fund, New York’s biggest EB-5 regional center, and was convinced that EB-5 money from Chinese investors was the perfect financing solution for Shvo’s planned 275-unit condo at 125 Greenwich Street in Lower Manhattan. “[It] sounds like legalized crack cocaine,” he raved to Shvo, according to an email later revealed in a lawsuit between the two. “You guys would be crazy not to jump on this.” [more]

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