The Securities and Exchange Commission has announced that it has obtained an emergency court order to freeze the assets of a husband and wife in Arcadia, California, who allegedly defrauded investors in two EB-5 investment offerings.

According to the SEC's complaint unsealed yesterday in the U.S. District Court for the Central District of California, Edward Chen (a/k/a Jianqiao Chen, Jian Qiao Chen, and Jian Chen) and Jean Chen (a/k/a Jing Jiang and Jean Jiang) control several companies that raised more than $22.5 million from 45 investors in China for the development of an interior design center in Ontario, California, and a residential condominium building in Los Angeles.

But the SEC alleges that the Chens stole more than $12 million out of investor funds by issuing cashier's checks to Jean Chen, transferring the money to affiliated entities, and purchasing residential real estate completely unrelated to the two EB-5 projects. The Chens allegedly misappropriated more than 91 percent of the money raised from investors in the interior design center project.

Smaller regional centers and projects do represent bigger risks.