After Joe Walsh publicly blamed Robert Matthews of fraud and claimed himself innocent, the wheels of justice kept turning. Many familiar with the case found it astounding that the FBI had claimed a $50m fraud against Robert Matthews but filed nothing on Joe Walsh.
Joe Walsh took to the media to pass all blame on to Matthews, but that was very premature.
The now embarrassing press release from Joe Walsh
The statement from Joe Walsh at USREDA
These events represent a significant outcome for the EB5 investors, and Palm House Hotel, LLLP. The General Partner, Mr. Joseph Walsh, Sr. has consistently stated that he and his companies have been defrauded by the Matthews family and other co-conspirators; Robert Matthews, Gerry Matthews, Nick Laudano and Les Evans and others, as outlined in a civil RICO suit, filed by General Partner, SARC and Palm House Hotel, LLLP. The RICO suit outlines how fraudulent documents were prepared by several attorneys, purchases of luxury yachts, lavish homes, luxury cars, jewelry, vacations and the like.
These indictments, and the guilty pleas to date, show conclusively that these charges were founded on facts. It has taken many months to gather and assemble the forensic accounting evidence of the multiple companies, off-shore accounts and entities, properties that were purchased in the general contractor’s name, family trusts and other means specifically designed to hide millions of dollars of transactions using several accounts, over several years.
And now questions must be asked of Joe Walsh’s expert and the FBI Charges against Matthews
Mr. Walsh thanks and applauds Mr. Brian Aryai, of ICON Compliance Services, a former U.S. Treasury and Homeland Security Senior Special Agent and certified public accountant among other impressive credentials. Mr. Aryai was one of the main forensic investigators and advisors in cases of national importance, such as the Bernie Madoff case. His expertise in sophisticated and complex fraud investigations has been instrumental in bringing this case to its inevitable conclusion. Mr. Aryai and his team worked tirelessly to provide several agencies a significant 1100-page report of investigation and numerous exhibits, in which the fraud and conspiracy was uncovered and brought to the point of prosecution.
Former Used Car Salesman Joe Walsh is now in the Spotlight
The SEC charges seem to contradict the FBI charges that may have been formed with the help of evidence from Joe Walsh and his “Mr. Brian Aryai” expert.
On August 3, 2018, the Securities and Exchange Commission charged two Florida residents in a securities offering fraud targeting immigrant investors.
According to the SEC’s complaint, over a period of more than two years, Joseph J. Walsh and Robert V. Matthews defrauded dozens of foreign investors participating in the EB-5 program administered by the United States Citizenship and Immigration Services, which provides foreign nationals with an opportunity to qualify for permanent U.S. residency by investing in domestic, job-creating projects. According to the SEC’s complaint, Walsh raised close to $44 million from foreign investors which, through a loan, was to be used to acquire, develop, and operate a Palm Beach hotel controlled by Matthews. The complaint alleges that Walsh misappropriated more than $13 million of the investor funds and that Matthews misappropriated approximately $8 million, some of which he used to acquire a 151-foot yacht and to purchase his former Connecticut home out of foreclosure. According to the SEC’s complaint, Walsh and two companies he controlled – Palm House Hotel LLLP (PHH) and South Atlantic Regional Center, LLC (SARC) – also misled investors about the use of an escrow account that purportedly held investor funds prior to disbursement to the hotel, and about Walsh’s and Matthews’ backgrounds.
The SEC’s complaint, which was filed in the Southern District of Florida, charges Walsh, PHH, and SARC with violating Section 17(a) of the Securities Act of 1933 (“Securities Act”) and Section 10(b) of the Securities Exchange Act of 1934 (“Exchange Act”) and Rule 10b-5 thereunder, and seeks permanent injunctions, disgorgement of ill-gotten gains with interest, and penalties. The SEC’s complaint also charges Matthews with violating Sections 17(a)(1) and (a)(3) of the Securities Act and Section 10(b) of the Exchange Act and Rules 10b-5(a) and (c) thereunder and with aiding and abetting PHH, SARC, and Walsh’s violations of Section 17(a)(2) of the Securities Act and Section10(b) of the Exchange Act and Rule 10b-5(b) thereunder. In addition, the SEC’s complaint also charges as relief defendants 160 Royal Palm, LLC and United States Regional Economic Development Authority LLC d/b/a EB5 Petition for the sole purpose of recovering investor funds they received from Walsh and his entities or Matthews.
The SEC’s investigation was conducted by Shelly-Ann A. Springer-Charles, Timothy J. Galdencio, and Crystal C. Ivory and was supervised by Eric R. Busto. The SEC’s litigation will be led by Alejandro Soto. The SEC appreciates the assistance of the United States Citizenship and Immigration Services.