The FBI is investigating a former top military aide to three U.S. presidents and his firm over allegations it bilked foreign investors out of millions of dollars by touting his White House ties and making promises of quick U.S. Green Cards to raise funds for a giant hotel complex, ABC News has learned. Five years after an elaborate ground-breaking ceremony in New Orleans, there is only a vacant lot and investors say almost $16 million has disappeared.
The former aide, retired Air Force Col. Timothy Milbrath, confirmed to ABC News that he is aware of the FBI investigation but said the allegations against him and his firm “are not correct.” Investors said the FBI has recently conducted interviews, and city officials in New Orleans confirmed agents have collected boxes of documents related to the company. A spokesperson for the FBI in New Orleans declined to comment.
The investigation centers on a project set up under a controversial U.S. immigration program known as EB-5 which allows foreign investors to obtain visas, and eventually Green Cards, if they invest at least $500,000 in projects that will create American jobs. As ABC News reported in February, an internal government review found that more than 30 EB-5 projects have come under criminal investigation, including the one set up by Col. Milbrath and a business partner, called Noble Outreach.
Promotional videos and material produced by Noble Outreach to entice foreign investors flaunt Col. Milbrath’s White House ties and feature photos of him serving Presidents Ronald Reagan, George H.W. Bush and Bill Clinton as chief of staff to the White House Military Office.
In a civil lawsuit, the investors allege that much of the $16 million they invested with Noble Outreach ended up going to Col. Milbrath, his partner William “Bart” Hungerford, Jr., and companies they controlled. None of the foreign investors were able to receive Green Cards because of the project’s failure, investors said.
“We were duped,” said Terry Sumpter, a retired British police officer who says he lost the bulk of his savings investing with Noble Outreach. “It’s gut wrenching, it really is.”
Sumpter is now living in Florida on an expired visa. He has been allowed to stay in the U.S. by immigration officials, but if he leaves the country, he fears he will not be permitted to return.
Milbrath told ABC News that because of the ongoing litigation, he cannot say what happened to the money but that, “Everything is accounted for.”
“I can honestly say that what we have here — the claims are not substantiated,” he said in an interview.
Noble Outreach is one of dozens of businesses that – despite being under federal investigation — remain certified by the Department of Homeland Security to operate as part of the little-known EB-5 immigrant investor program. Federal certification enables the firms to continue to solicit wealthy foreigners to invest $500,000 or $1 million in qualified U.S. projects. And they can promise in exchange that the investors will receive a two-year visa. The firms pledge that if the investment creates 10 American jobs, the investor will be able to short-cut the usually lengthy immigration process and receive a Green Card.
SOURCE: Matthew Mosk and Brian Ross