New York woman pleads guilty to $30M investment scheme tied to political campaigns

A New York woman pleaded guilty on Wednesday in relation to a multi-year investment scheme, falsely promising investors permanent resident status in the U.S. and selling foreign investors access to American politicians, including President Trump. 

Sherry Xue Li, of Oyster Bay, N.Y., pleaded guilty to money laundering conspiracy and conspiracy to defraud the U.S. government by obstructing the Federal Election Commission’s (FEC’s) administration of campaign finance laws, according to the U.S. Attorney's Office in the Eastern District of New York. 

Li faced up to 20 years in prison and agreed to forfeit $31.5 million and property at three locations as part of her plea agreement. 

“Li defrauded more than 150 victims in the United States and abroad through years of lies and deception and sought to profit by selling access to the democratic process. In doing so, she attempted to corrupt a fundamental institution in this country—fair and transparent elections free from unlawful foreign influence,” U.S. Attorney Nocella said in a statement. 

Li, along with her co-defendant Lianbo Wang, falsely promised foreign investors that by investing in a “fictitious” development project called Thompson Education Center, they would be able to obtain lawful permanent residence through an EB-5 visa program. The duo defrauded investors of over $30 million, prosecutors said. 

Li and Wang “siphoned off the money they fraudulently obtained from investors by transferring the funds through bank accounts held in the names of various companies that Li had created. Once the funds were in those accounts, "the pair used capital to pay for housing, jewelry, upscale dining, clothing and donate to U.S. politicians."

The pair acted as so-called “straw donors” for international investors to unlawfully donate to political campaigns and political action committees. They would promise access to lawmakers in exchange for a fee, according to prosecutors. The money they would gather would be utilized for political donations and they “falsely identified themselves and other U.S. citizens as the contributors of the funds.” 

The pair charged 12 foreign nationals $93,000 per person to attend a fundraiser. Then they made $600,000 of political contributions in their own names to the committee that hosted the event, according to the criminal complaint. Trump’s campaign was not accused of wrongdoing. 

“Li, Wang, and their foreign national guests attended the June 28, 2017 Fundraiser and took photographs with the then-President of the United States [Donald Trump]. Li and Wang later used a photograph of Li and the President taken at the June 28, 2017 Fundraiser to solicit investments in the TEC Project,” U.S. Attorney's Office in the Eastern District of New York said in the press release.