Orange County lawyer used EB-5 money for yacht: SEC

Newport Beach attorney allegedly misspent $9.5M

TRD LOS ANGELES /
Dec.December 29, 2016 09:30 AM

Here’s a quick lesson in how not to ride the EB-5 gravy train: Solicit lots of money from foreign investors and then spend it on a big fancy boat and other personal items.

That’s exactly what attorney Emilio Francisco did, according to a new civil fraud suit filed by the Securities and Exchange Commission. The suit alleges that Francisco defrauded more than 130 investors, squandering at least $9.5 million on personal expenses instead of on the development of assisted-living facilities and the expansion of the Caffe Primo coffeeshop chain.

Between 2013 and September of this year, Francisco raised more than $72 million in EB-5 money — mostly from Chinese investors — under his Costa Mesa consulting firm, PDC Capital Group, according to the Los Angeles Times. Since then, no assisted-living facilities have been built, although a few Caffe Primo storefronts have opened.

The EB-5 visa program, which grants foreign investors U.S. residency if they invest a minimum of $500,000 in designated business ventures that create at least 10 jobs, has seen several cases of fraud in Southern California in recent years.

The SEC sued a Redlands doctor last year, claiming that he misspent about $10 million from Chinese investors, as well as an Orange County couple, who also allegedly misused millions of dollars that were supposed to go toward a cancer treatment center, according to the Times.

The SEC asked the court to freeze Francisco’s assets. The Newport Beach lawyer is facing a ban from EB-5 solicitations and may have to pay his investors back.

Earlier this month, Congress extended the EB-5 program until April 28. But legislators are considering a new bill that would raise the minimum investment requirement from $500,000 to $800,000, among other revisions. [LAT]Cathaleen Chen


Related Articles

arrow_forward_ios
Claus Dieckell and Milan Capital Management's Anaheim office (Google Maps)

Accountant sentenced to prison for ripping off Orange County developer

Accountant sentenced to prison for ripping off Orange County developer
From left: Stanley Black and Robert Barth

The Black vs Barth saga continues: RE mogul files another suit against ex-partner

The Black vs Barth saga continues: RE mogul files another suit against ex-partner
From left: Robert Barth and Stanley Black with 840 Greenway Drive (Credit: Getty Images and Zillow)

Stanley Black says longtime partner bilked him out of millions

Stanley Black says longtime partner bilked him out of millions
Robert Shapiro and a few of the properties (Credit: iStock)

These are the pricey properties linked to Ponzi-schemer Robert Shapiro

These are the pricey properties linked to Ponzi-schemer Robert Shapiro
Former attorney allegedly bilked elderly people’s LA properties for years

Former attorney allegedly bilked elderly people’s LA properties for years

Former attorney allegedly bilked elderly people’s LA properties for years
City Century moves ahead on $1B South Park development

City Century moves ahead on $1B South Park development

City Century moves ahead on $1B South Park development
Wanda Group selling One Beverly Hills to Beny Alagem, Cain International

Wanda Group selling One Beverly Hills
to Beny Alagem, Cain International

Wanda Group selling One Beverly Hills
to Beny Alagem, Cain International
SEC charges law firm with EB-5 fraud scheme

SEC charges law firm with EB-5 fraud scheme

SEC charges law firm with EB-5 fraud scheme
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...