An immigration attorney who once ran a law office in California has been extradited from the central Asian nation of the Kyrgyz Republic on fraud charges related to investments made by foreign nationals seeking permanent U.S. residency.
Danhong “Jean” Chen, who also used the name Maria Sofia Taylor, appeared in a Northern District of California court in San Jose earlier this month. Chen, 60, who once lived in the city of Atherton, and her former husband, Jianyun “Tony” Ye, were indicted in 2019 by a federal grand jury and accused of fraudulently attempting to secure immigration benefits for more than 100 foreign investors in the federal government’s EB-5 visa program, according to a news release from the U.S. Justice Department.
The EB-5 program, which was created by Congress in the 1990s, allows foreign nationals to obtain green cards to work in the United States in exchange for their investments in qualified U.S. businesses that promote economic growth and create new jobs.
Ye served 12 months in a federal prison after pleading guilty to visa fraud and obstruction of justice, the Justice Department reported. But Chen fled to the country and her location was not unknown until her recent arrest in the Kyrgyz Republic. The U.S. Securities and Exchange Commission (SEC) filed a civil lawsuit against Chen in 2019, accusing her of improperly soliciting investments from foreign nationals.
The Justice Department reported that Chen had sent fraudulent documents to U.S. Citizenship and Immigration Services (USCIS) relating to the EB-5 program. Typically, an applicant in that program would have to invest $500,000 in a low-employment area to secure immigration benefits.
Chen, who operated the Law Offices of Jean D. Chen in San Jose, represented clients who had collectively invested $52 million in projects through the EB-5 program, prosecutors said. Chen had invested the foreign nationals’ funds in a regional center that she owned but failed to disclose to her clients that she had a financial interest in the center, according to the Justice Department.
Officials with the nonprofit American Immigrant Investor Alliance (AIIA), which advocates on behalf of EB-5 investors, emphasized that the fraud alleged in the Chen case took place well before reforms were made to the EB-5 program in the form of the Reform of Integrity Act of 2022.
“Fraud in EB-5 is, in my opinion, as likely to occur as fraud in any other private investment because these things tend to be securities offerings,” Shawn Gehani, director of community engagement for AIIA, told the Southern California Record. “Obviously, you’re not buying public securities, you’re buying private securities, and if somebody decides to run away with your money, that’s as possible in any real estate transaction as it is here.”
While acknowledging past problems with the program, Gehani stressed that reforms have provided significant safeguards.
"As an investor-focused organization, we remain mindful of past instances of fraud within the EB-5 program,” he said. “While no system can offer an absolute guarantee against future misconduct, we believe that the safeguards introduced under the 2022 Reform and Integrity Act (RIA) serve as strong deterrents against willful fraud and significantly enhance the integrity of the program."
A recent report from the Government Accountability Office (GAO) said that in fiscal year 2021, the number of verified EB-5 fraud and national security concern cases was less than 1% of the pending EB-5 petitions.
President Trump and his secretary of commerce, Howard Lutnick, last month suggested that the EB-5 program might be modified or even replaced by a “Gold Card” visa program that would provide green cards in return for $5 million payments to the government. AIIA President Ishaan Khanna said both programs could operate alongside each other.
“Essentially, they can co-exist,” Khanna said. “The Gold Card is a payment, ours is an investment, which creates jobs.”
Chen faces 10 counts of visa fraud, two counts of obstruction of justice and one count of aggravated identity theft. She could potentially serve decades in federal prison and face millions of dollars in fines if found guilty of all the counts.
The State Bar of California’s attorney database had no record that Chen was ever admitted to practice law in the state.