US corporate law weekly news: federal court grants SEC preliminary injunction in a fraudulent EB-5 scheme claim

On March 23, 2017, the United States District Court for the Northern District of California granted the SEC a preliminary injunction against a businessman on the grounds that he had commingled $107 million in EB-5 funds (which had been earmarked for the development of regional centers) with his own funds and business interests and that he misused some of the EB-5 funds.

While the injunction has a relatively narrow scope, only barring the accused and his company from issuing securities and destroying documents, it represents the SEC’s latest crackdown action targeting potentially problematic EB-5 regional centers.

For more information on the SEC. & Exch. Comm’n v. San Francisco Reg’l Ctr. LLC (N.D. Cal. Mar. 23, 2017) case, see here.

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