A ‘Good’ Investment Turns Out to Be a Scam
For nearly a decade, Jean Xie recalled making it a habit to search online for two things: "Fresh Meadows Hotel" and "New York City." She, a resident of Shenzhen in China, had become an investor in the Mayflower International Hotel Group’s Fresh Meadows Hotel EB-5 program which allowed foreign investors to obtain U.S. green cards by investing in U.S. businesses creating jobs.
A ‘Good’ Investment Turns Out to Be a Scam
In 2015, Xie made a $500,000 investment in the Mayflower’s Fresh Meadows Hotel project. She had mortgaged her two-bedroom apartment in Shenzhen and wired $550,000 to Hubei Mayflower Industry and Commerce Group. Her money covered the minimum $500,000 investment and $50,000 in legal fees, translation fees, and project issuance fees. Xie’s son signed a contract with Mayflower, which was the first step in getting his EB-5 visa.
The Project
Hubei Mayflower then transferred her money to the Mayflower Regional Center’s bank account, according to emails, financial documents, and contracts reviewed by Documented. The Mayflower Group was the developer behind the Fresh Meadows Hotel, which was completed in 2017. However, Xie remained in the dark about the project’s financial status, and her son’s green card application was still pending.
An Investigation
In 2021, Xie stumbled upon an investigation by THE CITY and The Guardian, which revealed a name she had never seen before and numerous financial details about the project that she had long sought but never received from the Mayflower Group. The investigation showed that Weihong Hu, the hotel’s owner, had secured $6 million in guaranteed annual rental income and special favors from Mayor Eric Adams’ administration after making significant contributions to his campaign. The investigation also revealed a "mutually beneficial relationship" between Mayor Adams and Weihong Hu.
Conclusion
Xie’s experience is an example of the potential risks and uncertainties associated with EB-5 investments. The program’s promise of a "good" investment can turn out to be a scam, leaving investors with significant financial and emotional distress. The case highlights the importance of transparency and accountability in EB-5 projects and the need for investors to be cautious and do their due diligence.
FAQs
Q: What is the EB-5 program?
A: The EB-5 program is a U.S. government program that provides a path to a green card for foreign investors who invest at least $500,000 in a new commercial enterprise that creates at least 10 full-time jobs for U.S. workers.
Q: What is an EB-5 Regional Center?
A: An EB-5 Regional Center is an organization designated by the U.S. Citizenship and Immigration Services (USCIS) to oversee EB-5 investments and ensure that investors and their families are considered for green cards.
Q: What is the Fresh Meadows Hotel EB-5 program?
A: The Fresh Meadows Hotel EB-5 program is an investment opportunity offered by the Mayflower International Hotel Group to foreign investors, allowing them to obtain U.S. green cards by investing in a new hotel project in New York City.
Q: Who is Weihong Hu?
A: Weihong Hu is the owner of the Fresh Meadows Hotel and the person behind the Mayflower Group, which is the developer of the Fresh Meadows Hotel EB-5 program. He has also been accused of making significant contributions to Mayor Eric Adams’ campaign and receiving special favors from the administration.
Q: What is the outcome of Jean Xie’s experience?
A: Jean Xie’s experience is an example of the potential risks and uncertainties associated with EB-5 investments. Her investment in the Fresh Meadows Hotel EB-5 program did not yield the expected returns, and she is still waiting for her son’s green card application to be processed.
