William Kelly, charged in Vermont along with Ariel Quiros and Bill Stenger in a massive EB-5 fraud case, has reached a plea deal with federal prosecutors that calls for him to spend three years in prison.
Kelly, according to court records filed in the case, was a key adviser to Quiros, the former owner of Jay Peak, and an “assistant in executing decisions” who later took the lead in developing what regulators have termed a “Ponzi-like” scheme.
Kelly was indicted in May 2019 along with Quiros and Stenger, Jay Peak’s former president and CEO, for his role in a failed biomedical research facility planned for Newport.
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More than 160 foreign investors seeking green cards in exchange for their investments each put at least $500,000 into the proposed $110 million facility known as AnC Bio Vermont.
The U.S. Securities and Exchange Commission later termed the project “nearly a complete fraud,” leaving the investors out of their investment and no way to meet the job creating requirements to obtain U.S. residency through the EB-5 program.
Kelly, according to the Thursday afternoon filing, agreed to plead guilty to two of the 10 counts leveled against him. The two charges are conspiracy to commit wire fraud and concealment of material information.
In exchange for his plea, prosecutors agreed to ask for a sentence of 36 months in prison for Kelly. A judge must approve of the deal.
As part of the plea agreement, Kelly agreed to “cooperate completely, candidly, and truthfully” with investigators. No hearing date for Kelly to enter his pleas was immediately set Thursday afternoon.
Federal prosecutors, through a spokesperson, declined to comment Thursday.
Robert Goldstein, a Boston attorney representing Kelly, could not immediately be reached Thursday for comment.
David Williams, an attorney for Stenger, declined to comment when asked what the latest plea deal might mean for his client.
Quiros already agreed to a similar cooperation provision as Kelly when he pleaded guilty last year to charges brought against him. Quiros is awaiting sentencing. Prosecutors can argue for a sentence of up to 97 months in prison, while Quiros’ attorney can argue for a lesser jail term.
Stenger, who has maintained his innocence throughout the case, is taking his case to trial, which is tentatively set for later this fall.
Quiros and Kelly are expected to be sentenced after Stenger stands trial.
Kelly and Quiros had a long business relationship dating back nearly three decades.
“He’s made some hard decisions that sometimes those of us around him have a hard time following,” Kelly said of Quiros in a 2014 interview with VTDigger. “But he makes good decisions, and we do follow them because we know at the end of the day they’re the right decisions.”
The criminal charges against the three men were brought more than three years after federal and state regulators leveled civil actions against Stenger and Quiros. Those actions accused the two men of misusing $200 million of the more than $350 million they raised from foreign investors for massive upgrades at Jay Peak and other projects in Vermont’s Northeast Kingdom.
Those civil actions brought to a halt the biomedical research facility project in Newport.
In mid-2012, according to charging documents, Kelly “took the lead in developing the details for the fraudulent business plans,” which became part of the information provided to potential foreign investors in AnC Bio Vermont.
“The plan was fraudulent in various ways,” the indictment stated, “including two major deceits: 1) secret embezzlement of investor funds; and 2) deceptions about the number of jobs to be created by the project.”
In a questionnaire prior to a deposition before the SEC, Kelly wrote that he served in the U.S. Marine Corps and is a Vietnam veteran. He also wrote that he received his bachelor’s degree from the University of Massachusetts at Amherst and a law degree from Western New England School of Law in Massachusetts. Kelly never held a license to practice law.
He termed himself a self-employed consultant based in Florida, and the chief operating officer of Vermont’s Jay Peak Resort, starting in August 2011.
Kelly has been free since his arraignment in May 2019 on a $100,000 appearance bond. He was ordered to surrender his passport.
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This content was originally published here.