EVERETT — Federal immigration officials are trying to end Everett-based Path America Snoco’s role in an investment-for-visas program.
The move could mean that dozens of Chinese nationals who invested in developer Lobsang Dargey’s Potala Place and Farmer’s Market in Everett could lose their shot at immigrating here.
Dargey already is fighting fraud allegations from the U.S. Security and Exchange Commission in a civil suit in federal court. He could also face criminal charges stemming from an ongoing investigation by the FBI.
The SEC alleges that Dargey misused and misappropriated as much as $46 million of foreign investors’ money, spending millions of dollars on a luxury house, shopping sprees and trips to casinos, according to court documents.
Path America Snoco was one of the myriad intertwined companies that the 42-year-old developer used to bring in foreign money to fuel his rapid rise in Everett and Seattle-area real estate markets.
The U.S. Citizenship and Immigration Services in November issued a notice of intent to terminate the Everett-based company’s status, according to several sources familiar with the civil suit in U.S. District Court for Western Washington.
A USCIS spokesman said the federal agency cannot discuss an ongoing case.
The agency has not started termination procedures against the other regional center run by Dargey — Path America Kingco.
The agency authorizes regional centers as part of its EB-5 program. That program allows foreign nationals to invest in developments promoting economic growth in the U.S. in exchange for a shortcut to applying for a U.S. green card.
Dargey’s projects sought to meet the economic growth requirement by creating jobs in the U.S. Under that requirement, foreign investors had to put in at least $500,000 to directly create or retain 10 full-time jobs here.
Regional centers process investors’ petitions for visas. They do not control the development project.
The USCIS can revoke a regional center’s status for several reasons, including failing to promote economic growth, according to an agency spokesman speaking on background.
If that happens, any pending applications for resident status associated with the center will be denied.
Nationally, the future of the controversial EB-5 program was unclear Thursday afternoon. It expires at the end of Friday. Supporters in Congress have been scrambling to rally support for renewing a modified version of the program as part of an omnibus spending bill that is expected to go to a vote Friday.
Lawmakers were still negotiating language this week, so it is not completely clear what it would look like if it is renewed.
A draft released Wednesday included language protecting investors who see their petitions scrapped when a regional center’s status is revoked, said Dan Lundy, an immigration attorney who has reviewed a copy of the draft.
Lundy and his firm, Philadelphia’s Klasko Immigration Law Partners, represent two Chinese nationals who invested in Potala Tower in Seattle.
According to Lundy, based on his conversations with attorneys representing other clients, many of Dargey’s investors want to keep their money in the projects, hoping that work resumes, as well as their chances for visas. “In fact, some may be willing to put in more money” to keep the projects alive.
Lundy’s clients are still considering their options, he said.
The court has allowed several investors to withdraw their money, which was still in escrow accounts. The SEC did not oppose those investors, as Dargey had not yet done anything with their money.
The SEC has opposed efforts by other investors to withdraw their money, which had been at least partially moved out of escrow.
It is not clear if or how their money was used by Dargey, the SEC said in court documents.
The court-appointed receiver, Michael Grassmueck, is still sorting through the messy and intertwined fiscal relationships between Dargey’s companies.
Dargey’s Potala Place and Farmer’s Market in Everett is far enough along that Grassmueck “tentatively concluded” that the project “should be completed, if possible,” he told the court in a report filed in mid-November.
However, he said, he did not have enough information to say that for sure, or when it might happen.
He declined to comment Thursday.
Dargey used money raised for the Everett project and Potala Tower, a planned skyscraper in Seattle, on other developments in Shoreline and Kirkland. The money was also spent to help Dargey buy a luxury home in Bellevue, shop at upscale stores and for trips to casinos in Washington and Las Vegas, according to the SEC lawsuit.
Dargey’s companies and other entities “are, structurally and functionally, intertwined, and have been treated and operated essentially as a unitary enterprise,” with money regularly mixed and moved between them, Grassmueck said in his report.
The fraud allegations against Dargey actually seemed to give a boost to people asking about renting apartments in the 220-unit Potala Place in Everett.
The building is more than half rented out, building manager Bill Crosthwait said. He works for Allied Residential, a third-party company hired to run the building.
The ground floor shops’ opening has been pushed back again to early next year, at least eight months later than initially planned, according to people familiar with the project.
Dan Catchpole: 425-339-3454; dcatchpole@heraldnet.com; Twitter: @dcatchpole.
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