- The Washington Times - Wednesday, November 29, 2017

A group of Chinese investors has filed a lawsuit against Virginia Gov. Terry McAuliffe accusing him of an immigration scam in the electric car company he helped found — dredging up his past dealings as a businessman and political player as he eyes a possible 2020 presidential run.

Filed last week, the lawsuit from 32 investors says Mr. McAuliffe ran a $120 million scam that tried to entice wealthy Chinese to invest in GreenTech Automotive in exchange for a pathway to U.S. citizenship. The investors said Mr. McAuliffe and Anthony Rodham, brother of Hillary Clinton, promised to exercise their political connections.

“These Defendants — through a labyrinth of corporate fronts — exploited the Plaintiffs’ desire to become permanent residents in our nation by, in sum and substance, making the following offer: invest $500,000 in our electric car company and we will leverage our political connections to ensure you immigration papers will get to the top of the pile, and then be approved,” the lawsuit says. “Better yet, according to Defendants, the investors would quickly recover their capital investments in full.”

McAuliffe spokeswoman Crystal Carson denied the accusations.

“We strongly reject this baseless suit which has no merit whatsoever,” Ms. Carson said. “The claims, which regurgitate old political attacks regarding a company that Gov. McAuliffe left five years ago, were brought by a lawyer with conservative ties. We are confident it will be dismissed.”

But Ryan Mulvey, counsel at the conservative government watchdog Cause of Action Institute, said he was shocked the legal action did not come sooner.

Gov. McAuliffe may no longer be involved with GreenTech and may not be held personally liable for the alleged fraud, but his efforts to advance corporates interests through political favoritism were patently unfair,” Mr. Mulvey said. “Hopefully, the court of public opinion will hold him accountable.”

Mr. McAuliffe turned his attention to the electric-car market following his loss in the 2009 primary for the Democratic gubernatorial nomination in Virginia. He and Chinese-American securities lawyer Charles Wang founded GreenTech Automotive.

They joined forces with Mr. Rodham’s Gulf Coast Funds Management, which specialized in a visa program known as EB-5 that rewarded big foreign investors with the chance to apply for U.S. citizenship in exchange for funneling large sums of money into the U.S. economy.

Mr. McAuliffe called himself a “leader” in the hybrid and electric-car markets, and boasted about doing something that “no one has done” by buying a car company in China and moving it to the U.S.

Concluding that Virginia wasn’t interested, he opened a factory instead in Mississippi, where it received millions of dollars in incentives.

Mr. McAuliffe vowed to build a $60 million factory for car production. He pledged the company would yield thousands of new good-paying jobs and produce hundreds of thousands of cars. The first 100,000 cars would be sold for $10,000, he promised.

The business unraveled thanks in part to a flawed private financing plan that centered on the EB-5 program. Gulf Coast Funds managed the EB-5 investments for GreenTech.

Mr. McAuliffe stepped down as chairman in 2012 and turned his attention to a second bid for governor.

Earlier this year, GreenTech shut down its Mississippi factory, which had opened in 2014.

Mississippi officials are seeking to recoup more than $6 million from GreenTech related to defaulted loan payments after the state auditor released a report finding that as of February the car plant had “approximately 10 active employees” and failed to fulfill its financial promises.

In addition, the Department of Homeland Security’s inspector general has said that Mr. McAuliffe received special treatment from a top DHS official in his quest to get green cards for his foreign investors under the EB-5 program.

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