As a member of Congress, Joe Garcia championed immigration visas that allow wealthy foreigners to obtain U.S. residency if they pledge at least $500,000 to job-creating projects within the nation’s borders.
According to one analysis, Garcia became the biggest beneficiary in Congress of donations from bankers and developers eager to expand the visa program, known as EB-5.
When the Miami Democrat was ousted from Congress after a single term, Garcia took a job as senior vice president for a private Miami Beach bank named QueensFort Capital that specializes in matching foreign investors to EB-5 visa projects.
Though not illegal or improper, the relationship illustrates the revolving door that often exists in Congress: As a lawmaker, Garcia worked on EB-5 legislation. He then worked for an EB-5 bank. Now he’s again running for Congress, where he might write EB-5 rules that would affect his former employer.
Garcia told the Miami Herald he got the bank job because he could leverage his local connections and not because he filed legislation in March 2014 to expand the EB-5 program.
“This was a job because I knew a lot of people in South Florida,” said Garcia, whose legislation didn’t pass. “The whole point was because of my relations. It was not because of my EB-5 expertise.”
There are no restrictions for out-of-office lawmakers to work in industries they supported while on Capitol Hill — as long as the ex-legislators don’t immediately become federal lobbyists, which Garcia didn’t do. Garcia doesn’t work for QueensFort anymore, though his photo and title remained on the company’s website Wednesday.
Now that Garcia’s running for his old seat — one of the most competitive in the country — incumbent Republican Rep. Carlos Curbelo has questioned whether Garcia’s former job would present any conflicts of interest.
“He represented EB-5 clients — foreigners — as soon as he left Congress last time,” Curbelo told the Herald’s editorial board last week.
Curbelo was trying to turn the tables on a question about why he has kept secret the list of private clients he represented as a government and public affairs consultant before getting elected to Congress in 2014. Curbelo was an elected Miami-Dade County school board member while he worked as a consultant.
Garcia’s campaign said he didn’t have any clients at QueensFort: He advised the bank on structuring investment deals but didn’t close on any of them.
Neither QueensFort nor its chairman, Arthur Halleran, responded to repeated requests for comment.
Curbelo and Garcia will debate for the first time Thursday evening at Belen Jesuit, the high school from which they both graduated (in different years).
Garcia said he resigned from his QueensFort position in December, after only 10 months, because banking and politics don’t mix. He launched his campaign for his old seat in February.
“These banks, they’re private institutions, and I certainly didn’t want to bring politics to that,” he said. “Most business people tend to shy away from” politics.
The EB-5 program allows foreigners to obtain a green card if they invest $500,000 or $1 million in projects that create or keep 10 jobs in the U.S. The visas have become especially popular in South Florida, where developers have been able to turn to foreign investment post-recession to kick-start projects that might otherwise have fallen short of enough money to qualify for a construction loan.
“It’s another tool — a source for projects that can’t get conventional financing,” said Frank Schnidman, who recently retired from teaching community development at Florida Atlantic University. “If you don’t have the equity investors, the EB-5 money essentially becomes your equity investors.”
The U.S. government doesn’t identify which investors obtain the visas. Critics — including an audit from the Department of Homeland Security — worry about potential threats, including the possibility that spies posing as investors infiltrate the country.
In an award-winning investigation published last year about flaws in the EB-5 program, The Sarasota Herald-Tribune found the industry gave more money to Garcia — more than $42,000 — than any other member of Congress. One of Garcia’s donors was Halleran, the QueensFort principal who later became his boss.
Garcia told the Herald he supports reforming the EB-5 program to tighten oversight, separate EB-5 project bankers from developers, and increase the investment and employment threshold for foreigners. He dismissed the suggestion his position poses any sort of conflict.
“I didn’t pass any legislation for them,” he said. “At the time I was in Congress, I wasn’t looking for a job or anything like that. … There is no quid pro quo.”
Garcia’s bill would have made permanent the “regional centers” — including one in Miami — that promote EB-5 visa projects. It would have also exempted investors’ spouses and children from a cap that limits EB-5 visas to 10,000 a year — effectively growing the number of investor visas available.
Having resigned from QueensFort, Garcia is a full-time political candidate, living off his personal savings during the campaign. He may have to soon cash in one of his retirement accounts, he said.
Garcia’s financial disclosure, which was filed in May, listed his previous-year salary from QueensFort at $90,000.