SEC Charges Lawyer With Stealing Investor Money in EB-5 Offerings
California attorney Emilio Francisco and 22 entities defrauded $72 million from Chinese EB-5 investors by diverting funds meant for job-creating projects to finance a yacht and personal businesses, stealing at least $9.6 million and jeopardizing their U.S. residency prospects, leading to SEC charges under securities laws and an emergency asset freeze.
The SEC charged Emilio Francisco, his firm PDC Capital, and 20 other Francisco-controlled businesses with defrauding $72 million from Chinese investors in the EB-5 program by misappropriating funds intended for projects like Caffe Primo restaurants, assisted living facilities, and green agriculture production. At least $9.6 million was stolen outright to fund Francisco’s luxury lifestyle—including a yacht—and prop up his unrelated businesses, violating Section 17(a) of the Securities Act and Section 10(b) of the Exchange Act along with Rule 10b-5. The SEC is seeking an emergency asset freeze and court-appointed receiver to halt further asset dissipation, with U.S. Citizenship and Immigration Services providing investigative support.
California attorney Emilio Francisco, along with his marketing firm PDC Capital and 20 other controlled entities, is accused of orchestrating a $72 million fraud targeting Chinese investors in the EB-5 immigrant investor program, which promises U.S. residency in exchange for job-creating investments. Investors were solicited to fund projects including Caffe Primo restaurants, assisted living facilities, and environmentally friendly agricultural production, but Francisco diverted funds between projects and stole at least $9.6 million to finance a yacht, personal expenses, and unrelated businesses. The SEC alleges Francisco knowingly violated federal securities laws by deceiving investors about how their money would be used, thereby jeopardizing their eligibility for U.S. permanent residency under EB-5 regulations. Charges include violations of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934, along with Rule 10b-5. The SEC has filed for an emergency asset freeze and the appointment of a court-appointed receiver to prevent further dissipation of assets tied to the scheme. The investigation, led by the SEC’s Los Angeles Regional Office with key personnel including Adrienne D. Gurley, Jasmine Starr, and Christopher M. Conte, received critical assistance from U.S. Citizenship and Immigration Services. Litigation is being spearheaded by John B. Bulgozdy, with oversight from Spencer Bendell, Alka N. Patel, and John W. Berry.
Exhibits & Attached Documents (1)
Extracted insights
- $72.00M $72 million $10M–$100M
- $9.60M $9.6 million $1M–$10M
- agency director of sec's los angeles regional office
- person Emilio Francisco
- company emilio francisco and pdc capital
- person john b. bulgozdy
- person Michele Wein Layne
- agency sec's litigation
- agency sec's los angeles office investigators
- agency Securities and Exchange Commission
- person stolen funds
- SEC charged Emilio Francisco with defrauding investors in EB-5 immigrant investor program
- Emilio Francisco raised $72 million from investors in China
- Emilio Francisco solicited through PDC Capital marketing firm
- Emilio Francisco and PDC Capital diverted investor funds from one project to another
- Emilio Francisco and PDC Capital stole at least $9.6 million
- Stolen funds used to finance Francisco's own businesses and luxury lifestyle including yacht purchase
- SEC charges Francisco, PDC Capital, and 20 other Francisco-controlled businesses with violating Section 17(a) of Securities Act of 1933 and Section 10(b) of Securities Exchange Act of 1934
- SEC seeking emergency asset freeze and court-appointed receiver over Francisco's businesses
- Michele Wein Layne is Director of SEC's Los Angeles Regional Office
- SEC's Los Angeles office investigators include Adrienne D. Gurley, Jasmine Starr, and Christopher M. Conte
- Case supervision by Spencer Bendell, Alka N. Patel, and John W. Berry
- John B. Bulgozdy leading SEC's litigation
The Securities and Exchange Commission today charged a California-based attorney with defrauding investors seeking to participate in the EB-5 immigrant investor program, stealing their money to buy a yacht and prop up his other businesses. The SEC alleges that Emilio Francisco raised $72 million from investors in China solicited through his marketing firm PDC Capital to invest in EB-5 projects that included opening Caffe Primo restaurants, developing assisted living facilities, and renovating a production facility for environmentally friendly agriculture and cleaning products. Under the EB-5 program, foreign investors can apply to permanently live and work in the U.S. by investing money in certain projects that bring about American jobs. According to the SEC’s complaint, Francisco and PDC Capital diverted investor funds from one project to another and outright stole at least $9.6 million that was used to finance Francisco’s own businesses and luxury lifestyle. Francisco was allegedly aware that doing so would violate federal regulations and jeopardize any visas for the foreign investors. “As alleged in our complaint, Emilio Francisco illegally enriched himself with investor money intended for specific EB-5 projects that create jobs for U.S. workers,” said Michele Wein Layne, Director of the SEC’s Los Angeles Regional Office. The SEC’s complaint charges Francisco, PDC Capital, and 20 other Francisco-controlled businesses with violating Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5. The SEC is seeking an emergency asset freeze and a court-appointed receiver over Francisco’s businesses involved in the schemes. The SEC’s investigation has been conducted in the Los Angeles office by Adrienne D. Gurley, Jasmine Starr, and Christopher M. Conte, and the case has been supervised by Spencer Bendell, Alka N. Patel, and John W. Berry. The SEC’s litigation is being led by John B. Bulgozdy. The SEC appreciates the assistance of U.S. Citizenship and Immigration Services.
The Securities and Exchange Commission today charged a California-based attorney with defrauding investors seeking to participate in the EB-5 immigrant investor program, stealing their money to buy a yacht and prop up his other businesses. The SEC alleges that Emilio Francisco raised $72 million from investors in China solicited through his marketing firm PDC Capital to invest in EB-5 projects that included opening Caffe Primo restaurants, developing assisted living facilities, and renovating a production facility for environmentally friendly agriculture and cleaning products. Under the EB-5 program, foreign investors can apply to permanently live and work in the U.S. by investing money in certain projects that bring about American jobs. According to the SEC’s complaint, Francisco and PDC Capital diverted investor funds from one project to another and outright stole at least $9.6 million that was used to finance Francisco’s own businesses and luxury lifestyle. Francisco was allegedly aware that doing so would violate federal regulations and jeopardize any visas for the foreign investors. “As alleged in our complaint, Emilio Francisco illegally enriched himself with investor money intended for specific EB-5 projects that create jobs for U.S. workers,” said Michele Wein Layne, Director of the SEC’s Los Angeles Regional Office. The SEC’s complaint charges Francisco, PDC Capital, and 20 other Francisco-controlled businesses with violating Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5. The SEC is seeking an emergency asset freeze and a court-appointed receiver over Francisco’s businesses involved in the schemes. The SEC’s investigation has been conducted in the Los Angeles office by Adrienne D. Gurley, Jasmine Starr, and Christopher M. Conte, and the case has been supervised by Spencer Bendell, Alka N. Patel, and John W. Berry. The SEC’s litigation is being led by John B. Bulgozdy. The SEC appreciates the assistance of U.S. Citizenship and Immigration Services.