The owners of a northern Vermont ski resort operated a “Ponzi-like” scheme, spending $50 million of investor funds intended for an expansion of the property on personal expenses including a condo, U.S. Financial regulators charged on Thursday.
A federal judge in Miami ordered the assets of Jay Peak and related businesses frozen after the Securities and Exchange Commission charged that its owners raised some $350 million from investors for projects including new resort facilities and a biomedical research facility, but spent the new funds on old projects that had gone over budget.
Owner Ariel Quiros, who lives in Miami according to federal prosecutors, used investor funds to pay expenses including his income taxes, to acquire another unrelated ski resort and to buy a luxury condo, the SEC said.
“The alleged fraud ran the gamut from false statements to deceptive financial transactions to outright theft,” said Andrew Ceresney, director of the SEC’s division of enforcement.
Company officials did not immediately respond to Reuters‘ request for comment.