The board of the V.I. Economic Development Authority has asked representatives of TAG Virgin Islands to meet with them to defend whether the company should remain an Economic Development Commission beneficiary.
Tagliaferri was arrested in February on charges of concocting an elaborate scheme to defraud clients of his St. Thomas-based investment firm. He was also the subject of a December 2010 lawsuit alleging TAG Virgin islands improperly invested $60 million under its management.
However, the company is still “technically” an Economic Development Commission beneficiary. EDA board members now question whether the benefits should be revoked.
Tagliaferri was one of the first topics of discussion at Friday’s Economic Development Authority board meeting on St. Thomas. Board members said it was about time that the company’s principals come in and “show cause” as to why their benefits should not be revoked.
TAG Virgin Islands started receiving EDC tax breaks in 2007 and according to EDC board chairman Albert Bryan Jr., the company is still “technically” a beneficiary.
“In order for us to revoke benefits in full we have to grant due process,” Bryan explained over the weekend. “Technically they are still a beneficiary and years prior to their trouble are still subject to EDC compliance, but they cannot take benefits. This ‘show cause’ hearing allows them a chance to present their case as to why their benefits should not be revoked up to and including all previous years.”
All EDA board members voted to have the company come in soon to make their case; they also required that TAG Virgin Islands provide the names and contact information of their resident agent and principals.
According to published reports, Tagliaferri allegedly received undisclosed payments in exchange for directing his clients to invest in certain securities; used client funds for improper purposes, including making payments to other clients who were demanding their funds; and caused false and fictitious securities instruments to be placed in client accounts. In total, Tagliaferri allegedly received more than $3 million in undisclosed payments in connection with the fraud, according to court documents.
The SEC has said that Tagliaferri’s investments on behalf of clients included at least $40 million of notes from International Equine Acquisitions Holdings Inc, a privately held owner of thoroughbred racehorses in Garden City, New York. Tagliaferri’s involvement with the company recently garnered a mention on CBS Sports, whose reporters were looking into the history of once-prized racehorse Big Brown, and his fall from grace.
