BURLINGTON, Vermont (AP) — The former owner of two Vermont ski resorts faces sentencing Friday for his role in a failed plan to build a biotech factory in Vermont using tens of millions of dollars in cash of foreign investors.
The conviction of Ariel Quiros, former owner of Jay Peak and Burke Mountain, ends the biggest fraud case in Vermont history.
The financial scandal involving Quiros and two others rocked the state and its rural and economically depressed region called the Northeast Kingdom. A fourth man, a businessman in South Korea, remains at large.
Prosecutors described Quiros, a Miami businessman, as a “wheel-dealer” who played a role in the larger scheme.
“The crimes could not have occurred without the toxic mix of strong personalities of these three men,” wrote Assistant U.S. Attorneys Paul van de Graaf and Nicole Cate in their sentencing document.
Quiros, former Jay Peak chairman William Stenger and Quiros adviser William Kelly were indicted in 2019 over the failed plan to build the AnC Bio plant in Newport, Vermont, using millions raised through a visa program that encourages foreigners to invest in job-creating businesses. in the United States in exchange for a chance to obtain permanent residence.
Quiros pleaded guilty in August 2020 to charges of conspiracy to commit wire fraud, money laundering and concealment of material information related to the AnC project, which the judge said was a fiction from the start. Nine other charges were dropped.
Stenger, of Newport, and Kelly, of Fort Lauderdale, Fla., were each sentenced earlier this month to 18 months in prison, with Stenger ordered to pay $250,000 and Kelly to pay $8.3 million in compensation.
Prosecutors asked the judge to sentence Quiros to less than a maximum of eight years under the plea deal, based on his cooperation and acceptance of responsibility. The defense requested 18 months of home confinement, citing his cooperation, his military service and his wife’s health problems.
Prosecutors said the project aimed to raise $110 million from 220 investors to build and operate the biotech facility, according to records and court proceedings. About 170 investors invested at least $500,000 each for a total of about $85 million between 2012 and 2016, but the project was never built, prosecutors said.
Three years before Quiros and Stenger were indicted, the federal Securities and Exchange Commission and the state of Vermont alleged in 2016 that they participated in a “massive eight-year fraudulent scheme.” The civil allegations involved the misuse of more than $200 million of approximately $400 million raised from foreign investors for various ski area developments under the same “Ponzi-style” visa scheme.
Quiros and Stenger settled the civil charges with the SEC, with Quiros disposing of more than $80 million in assets, including the two stations.
Prosecutors wrote in their sentencing recommendation in the criminal case that Quiros relied on Kelly and Stenger to work out the details, with Stenger acting as the fundraiser and face of the biotech factory project, and Kelly carrying out his wishes and solving problems.
Quiros was more interested in profits than details, and “perceived that these professionals had his back,” prosecutors wrote. “He wanted the gravy train to keep rolling, if possible,” they wrote.
Quiros’ attorney wrote that Quiros overwhelmingly demonstrated his contrition and desire to make amends, took full responsibility for his conduct, and “demonstrated substantial remorse.”
Associated Press writer Wilson Ring in Burlington contributed to this report.