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SEC charges NY businessman with fraud and unregistered sales of securities to investors seeking permanent residency in US – Times of India

MUMBAI: The Securities and Exchange Commission (SEC) has leveled charges against Nadim Ahmed, a New York-based businessman, and his companies, NuRide Transportation Group, LLC, and NYC Green Transportation Group, LLC. The allegations involve making fraudulent misrepresentations in securities offerings to investors seeking permanent residency through the EB-5 Immigrant Investor Program.
Alongside Ahmed, the SEC has also charged Mehreen Shah, also known as Mona Shah, a New York-based immigration attorney, and her law firm, for offering unregistered securities that amassed over $66 million from more than 100 investors.
Under the EB-5 program, investors can secure permanent residency status in the United States (US) by making a qualifying investment in a new commercial enterprise that generates a specific number of full-time jobs for eligible American workers.
According to a press release issued by the SEC, from approximately June 2014 through December 2018, Ahmed, NuRide and NYC Green falsely told NYC Green investors that NYC Green would be operated in a manner consistent with the requirements of the EB-5 visa program and that NYC Green’s principals had contributed $11 million to the company.
Further, Ahmed, NuRide, and NYC Green allegedly put key revenue-generating contracts in NuRide’s name despite telling investors that NYC Green would be the operating transportation business. Ahmed also allegedly used one investor’s funds to pay a portion of a prior settlement between another one of his companies and the SEC.
In addition, from June 2014 through November 2022, Ahmed, NuRide, and NYC Green, along with Shah, her law firm, and three other entities associated with Ahmed and/or Shah, allegedly offered or sold unregistered securities, including to individuals residing in the US, in three offerings, for which no exemption to the registration requirements was available. According to SEC’s complaint, to date, none of the investors in the offerings has received unconditional permanent residency status or a return of their investment.
Responding to SEC’s allegations, Mona Shah, Managing Partner of the law firm Mona Shah & Associates Global (MSA), in a press release states, ““It is disappointing that the SEC has made these allegations based on a technicality, and we are confident we will show we acted appropriately.” MSA’s release states that the SEC complaint followed a rushed investigation based on incomplete information, given the SEC’s concerns about potential issues with the statute of limitations. SEC’s complaint does not allege fraud against Shah, MSA or Gravitas NYC regional center, but instead alleges that their securities offerings failed to comply with the technical exemptions from registration, it explains.
The claim made by the SEC is based on a technicality, Shah, MSA and Gravitas NYC regional center believe the claim is unfounded and unsupported by the evidence that we acted appropriately, it adds. “We are confident that we will prevail in court, given the strength of our legal and factual arguments,” Shah said. “Hopefully this case will set a precedent that will demonstrate that this kind of sweeping complaint has no merit.” MSA’s press release also states that the SEC complaint has had troubling consequences for the investors.
SEC’s press release highlights that none of the investors involved in these offerings have obtained unconditional permanent residency status or received a return on their investments. Its release quoted Thomas P. Smith, Jr., Associate Regional Director in the New York Regional Office. He said: “All offering materials, including those provided to investors seeking residency under the EB-5 program, must contain accurate disclosures about the securities being issued. And all securities offerings must comply with the registration requirements or the exemptions to those requirements.”
The SEC’s complaint, has been filed in the US District Court in the Southern District of New York, it charges Ahmed, NYC Green, and NuRide with violating the antifraud provisions; and along with Shah, her law firm, and three other entities associated with Ahmed and/or Shah, the registration provisions of the federal securities laws. The complaint seeks permanent and conduct-based injunctions, disgorgement, prejudgment interest, and civil penalties. All parties will be heard by the district court, before issue of a verdict.

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