It sounded like a fever dream or a movie script from the early 2010s. A massive, $6 billion "mini-city" dropped right into the quiet, wooded landscape of rural Connecticut. We're talking about China City New London, a project so ambitious—and frankly, so weird—that it left local residents and international investors scratching their heads for years.
Honestly, the scale was hard to wrap your head around. The pitch involved a sprawling complex featuring a five-star hotel, a massive casino, an "international business center," and thousands of residential units. All of this was supposed to be built in the town of Montville, just a stone's throw from the actual city of New London.
But if you drive through Montville today, you won't see a glittering skyline. You won't see a "forbidden city" replica or a high-tech trade hub. You’ll see trees.
What Was China City New London Supposed to Be?
The mastermind behind this was a group called China City of America, led by a woman named Sherry Li. The vision wasn't just a suburban development; it was a self-sustaining ecosystem. They wanted to create a place where Chinese companies could set up shop on American soil, leveraging the EB-5 visa program to fund the whole thing.
For those who aren't familiar, the EB-5 program is basically a "green card for investment" deal. If a foreign national invests a certain amount of money in a U.S. project that creates jobs, they get a path to permanent residency. It’s a controversial system, and China City New London became one of its most notorious examples.
Li’s team didn't just want offices. They planned for a private school, a college, and a massive "national park" themed after Chinese culture. It was basically an attempt to build a city from scratch in a place that mostly valued its quiet, rural character.
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The Red Flags Started Waving Early
People were skeptical. Very skeptical.
The first major hurdle was the land itself. The proposed site was roughly 900 acres, much of it environmentally sensitive wetlands. You can't just pave over a swamp in Connecticut without a mountain of permits, and the developers seemed... well, unprepared for that reality.
Then there was the branding. Calling it China City New London was a bit confusing since it wasn't actually in New London, but rather in the neighboring town of Montville. Locals were worried about traffic, the strain on the water supply, and the sheer audacity of plopping a $6 billion development into a town with a population of about 19,000 people.
Why the China City New London Project Collapsed
Ambition is great, but you need more than a glossy brochure to build a city. The project faced a literal wall of opposition. Environmental groups, local planning boards, and even some state officials looked at the plans and saw more questions than answers.
One of the biggest issues was transparency. Where was the $6 billion coming from? While the EB-5 program was the primary engine, the math didn't always add up. To raise that kind of capital through EB-5, you would need thousands of individual investors, each putting up $500,000 or more. That is an insane amount of paperwork and vetting.
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The SEC Steps In
The real nail in the coffin came from the federal government. In 2022, the U.S. Securities and Exchange Commission (SEC) charged Sherry Li and her business partner, Lianbo Wang, with orchestrating a massive fraud.
According to the SEC, the duo raised about $27 million from over 150 investors for the China City New London project. But instead of building a city, the SEC alleged they used a huge chunk of that money for personal expenses—think luxury cars, jewelry, and even political contributions. It wasn't just a failed business venture; the government alleged it was a calculated scheme to defraud people looking for a better life in the United States.
It’s a classic cautionary tale of the "too good to be true" variety. They had these grand renderings of glass towers and cultural centers, but the SEC complaint painted a picture of empty bank accounts and diverted funds.
The Lasting Impact on Montville and the EB-5 Program
Even though the towers never rose, the project left a mark. It fundamentally changed how local towns in Connecticut view large-scale foreign investment. There's a lot more scrutiny now. People ask harder questions.
The failure of China City New London also served as a catalyst for reforming the EB-5 program. For years, the program was criticized as a "golden ticket" for the wealthy, prone to abuse and lack of oversight. The high-profile collapse of projects like this one pushed Congress to pass the EB-5 Reform and Integrity Act of 2022.
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The new rules are much stricter. There’s more transparency required, better auditing, and tougher penalties for those who try to play the system.
What’s Left Behind?
Today, the land in Montville remains largely as it was. The "China City" dream is dead, replaced by a legal paper trail that stretches for thousands of pages. For the investors who put their life savings into the project, the fallout was devastating. Many were left without their money and without the green cards they were promised.
It’s easy to look back and say, "How did anyone believe this?" But at the time, the idea of a globalized trade hub in a quiet corner of New England felt, if not likely, at least possible in a rapidly changing world economy.
Real-World Lessons from the China City Saga
If you’re looking at a major real estate investment or a development project in your own backyard, there are some pretty clear takeaways from the China City New London mess.
- Zoning is King: If the developers don't have a clear path to environmental and local permits, the project is just a drawing. In Connecticut, "wetlands" is a word that can stop a billion-dollar project in its tracks.
- The EB-5 Trap: Always look at the funding structure. If a project relies 100% on immigrant investor visas without significant institutional backing (like major banks or established developers), proceed with extreme caution.
- Local Resistance Matters: You can't build a city if the neighbors hate it. The grassroots opposition in Montville was relentless, and it played a huge role in slowing the project down until the federal authorities could catch up.
The story of China City New London isn't just about a failed construction project. It’s a story about the intersection of immigration policy, rural politics, and the dark side of the "American Dream" sold to international investors. It’s a reminder that while capital is global, real estate is always, always local.
If you want to track where the land stands now, your best bet is to look at Montville's property records. The parcels originally intended for the project have changed hands or gone into limbo, but the woods are still there, undisturbed by the glass towers that were never meant to be.
To avoid getting caught in similar speculative real estate traps, always verify that a project has secured "Site Plan Approval" from the local planning and zoning commission before taking any investment claims seriously. You can usually find these records on a town’s municipal website or by visiting the Town Hall in person. For federal oversight, the SEC’s "EDGAR" database is the gold standard for checking if a company has actually filed the necessary paperwork for large-scale investment offerings.