Terry McAuliffe found a willing partner in hack Beltway GOP crony Haley Barbour when he was Mississippi governor.
4/1/13, "Experts question source of McAuliffe car-company funding," Watchdog.org, Kenric Ward
"CLARIFICATION: Attorneys for Green Tech have contacted us and asked for a retraction of our April 1 and April 3 articles. In particular, they object to the use of the term “fraud” in our reporting. Lest there be any confusion about the point of our articles, we have updated them. To be clear, our articles were not intended to (and did not) accuse Green Tech of committing fraud. Instead, the articles pointed out that the federal EB-5 visa program – which trades citizenship for business investments and which Green Tech has used as a source of capital – has lax oversight, is prone to abuse and fraud, and cannot possibly deliver on its promises to taxpayers and investors. Our articles also quoted sources who criticized Green Tech’s reliance on the EB-5 program – the same criticism that Virginia officials leveled against the company in 2009. We stand by our reporting about the EB-5 program and will continue to investigate this important story. — Editors"
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"Gubernatorial candidate Terry McAuliffe’s use of an immigrant-investor program to raise money for his electric-vehicle venture [updated] is unworkable, experts said.
To kick-start GreenTech Automotive in Mississippi, the Virginia Democrat has sought funding through federal EB-5 immigration visas. In exchange for investments of $500,000, foreign nationals can gain U.S. citizenship for themselves and their families.
But the EB-5 system has been heavily criticized for its lack of transparency and lackadaisical enforcement. McAuliffe’s venture is seen as a particularly bad fit for the alien-investor program that’s supposed to create U.S. jobs.
Documents obtained by Watchdog.org show that, in their 2009 analysis of the project, Virginia officials warned Gov. Tim Kaine about the project. Allowing GreenTech to proceed with EB-5 funding in that state “would cause some to conclude that the commonwealth knew, or should have known, that there were problems, but proceeded nonetheless.”
“EB-5 is good for funding certain kinds of projects, but it’s not appropriate for this type of large-scale, long-term funding,” said Michael Gibson, managing partner of U.S. Advisors, a Florida-based research and investment firm knowledgeable about the program.
McAuliffe, the company’s founder and chairman, announced in 2009 intentions to build “neighborhood electric vehicles” that are little bigger or faster than golf carts. The GTA website touts “Green Jobs Made in the USA,” but, in fact, few U.S. jobs and fewer cars have been created.
“This project is a fantasy. It’s really a very poorly conceived project for EB-5 financing, and extremely problematic,” Gibson told Watchdog.
GreenTech’s conduit for EB-5 investors is Gulf Coast Funds Management Ltd., a regional center authorized by the U.S. Citizenship and Immigration Services. The center’s board of directors is larded with political cronies who have close connections to Bill and Hillary Clinton.
Per its non-disclosure policy, USCIS would not provide financial details about the Gulf Coast center, which the federal agency approved in 2008 to fund job-creating ventures in “targeted zones” in Louisiana and Mississippi.
Officials in Mississippi and Tunica County, where GreenTech plans to build a manufacturing plant, assert that the company has millions of dollars in pending EB-5 investments through Gulf Coast Funding.
“We understand, they’re having trouble getting funds released from the immigration system,” Clifton Johnson, Tunica County administrator, told Watchdog. Johnson estimated that “$10 million to $20 million is at stake.”
USCIS spokesman Christopher Bentley said he could not comment on the situation.
Executives at Gulf Coast and GreenTech, including McAuliffe, did not respond to Watchdog’s repeated requests for interviews. Previously posted news releases and pictures of McAuliffe showing off cars no longer appear on the GTA website.
Gibson said that Gulf Coast’s politically connected board of directors is out of its depth.
He noted that its members – including president and CEO Anthony Rodham (Hillary Rodham Clinton’s brother), Clinton IRS Commissioner Margaret Richardson and ex-Louisiana Gov. Kathleen Blanco – are distinguished by their long-time ties to the Democratic Party and the former president.
“They don’t know anything about the automotive business. This is very deceptive advertising. They’re out there fishing,” Gibson asserted.
Watchdog.org, meanwhile, uncovered a second EB-5 funding operation: the Virginia Center for Foreign Investment and Job Creation. That regional center, founded in 2011, shares the same McLean, Va., address as GCFM. McLean also happens to be McAuliffe’s hometown, and Rodham is listed as VCFIJC’s registered agent. None of the privately held companies has publicly disclosed their financial records.
David North, a policy analyst with the enforcement-oriented Center for Immigration Studies, said the EB-5 program is marred by bureaucratic opacity and loose oversight.
“USCIS thinks of itself as a benefits-granting agency, not an enforcement agency,” North told Watchdog. “That they will provide no (job or investment) numbers (about Gulf Coast) is par for the course.”
Virginia officials were skeptical about EB-5 as a funding source for GreenTech when they reviewed a preliminary proposal in 2009.
An internal memo from former Gov. Tim Kaine‘s administration obtained via the Freedom of Information Act contained this warning:
“If GTA is looking to raise significant funds through the EB-5 program, there may not be enough EB-5 visas available for this project. … Even if each investor provided $500,000, that would still leave a (figure deleted) billion-dollar funding gap.”
Ultimately, both Kaine (a Democrat) and his successor, Bob McDonnell (a Republican), declined GreenTech’s loosely arranged proposition.
McAuliffe, a former chairman of the Democratic National Committee who ran unsuccessfully for his party’s Virginia gubernatorial nomination in 2009, found a more receptive audience in Mississippi.
Republican Gov. Haley Barbour’s Mississippi Development Authority signed a Memorandum of Understanding with GreenTech in July 2011, pledging more than $8 million in land, grants and other incentives to lure the start-up to Tunica County. The firm also got 10 years’ worth of state income and franchise tax exemptions.
The agreement stipulates that GreenTech must raise $60 million in capital (including public funds) and have 350 workers on the payroll by the end of 2014.
GreenTech reportedly has spent $5 million on initial site preparation for its Tunica plant. But work has moved at a snail’s pace.
GTA initially pledged to hire thousands workers who would be assembling tens of thousands of vehicles by the end of 2012. None of those projections has come close to fruition.
“They talk of a big assembly line. They had six cars,” noted Michael Sheffield, a Memphis Business Journal reporter who visited GreenTech’s temporary facility in Horn Lake, Miss., 15 miles north of Tunica.
“Without EB-5, they’re in trouble,” Tunica County administrator Johnson says.
As GreenTech idles, McAuliffe is, ironically, making job creation a centerpiece of his gubernatorial bid in Virginia. And his Mississippi gambit hasn’t been a total loss for the Old Dominion.
Despite its name and regional mission, Gulf Coast Funds Management is headquartered in McLean and adding staff. It recently obtained federal approval to hire one of two requested law clerks.
Yet there’s a catch there, too. The new hire is not a Virginian, but a foreign national imported through the H-1B visa program.
Noting there is no known shortage of law clerks residing in the D.C. region, North called Gulf Coast’s move “exploitative.”
“This EB-5 regional center has had the chutzpah to simultaneously apply to the Department of Labor and USCIS to bring in two foreign workers for its headquarters in lush McLean,” he said.
North said the $36,500 annual salary for the position was “quite low for a professional job hired through H-1B.”" via Mark Levin twitter
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4/4/13, "Feds Look Closer at Cash Source in McAuliffe Car Scam," Breitbart, Kenric Ward
"McAuliffe trio," photo via Breitbart News
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