Stenger settles with SEC in Jay Peak fraud

Bill Stenger, the former CEO and president of Jay Peak Resort, has partially settled with the Securities and Exchange Commission.

The SEC alleged in April that Stenger made material misrepresentations to defraud 700 immigrant investors from 74 countries in an effort to allegedly aid and abet his business partner, Ariel Quiros, in a “Ponzi-like” scheme.

The violations alleged in the SEC complaint ranged from diverting funds from one project to another, misstating revenue projections and failing to make required contributions to developments.

The actions, according to the complaint, put EB-5 investors, who each contributed $500,000 plus a $50,000 administrative fee, at risk of losing money as well as their eligibility for U.S. citizenship.

Under the agreement, Stenger cannot admit or deny allegations that he violated securities laws in the agreement with the SEC.

The permanent injunction bars Stenger from participating in the EB-5 program.

Stenger adamantly denied any culpability immediately after federal and state regulators brought charges against him in April.

In a statement made last Thursday, Stenger said the settlement “sets up a framework to fully resolve the case the SEC filed against me.”

“I also have been fully cooperating with the Receiver since his appointment,” Stenger said.

The former CEO of Jay Peak has agreed to cooperate with Michael Goldberg, the SEC receiver, as part of the case against Quiros and could testify against the Miami businessman in a future civil trial.

Goldberg announced to investors and creditors Friday that Stenger is no longer working at the resort.

Stenger said he will no longer speak to the press. “Based upon the terms of the settlement, this is all I can say and will be saying,” Stenger said. “I ask that you please respect that I will not be making any more public statements about the settlement nor about the case. I want to focus my efforts fully to assist the Receiver and to help the investors.”

A civil penalty may be levied at a future date, depending on Stenger’s ability to pay and his level of cooperation.

The state has also charged Stenger with making material misrepresentations to investors. A resolution in that case has not yet been reached. The U.S. Attorney is also investigating possible criminal charges associated with the Jay Peak case.

Stenger had been working full-time for the resort since the Securities and Exchange Commission filed charges against the former CEO of Jay Peak in April. In that role, he provided Goldberg and Leisure Hotel Resorts information about resort operations. Stenger was paid the equivalent of $100,000 annual salary over the past four and a half months.