Texas AG Ken Paxton and DOJ Official Harmeet Dhillon Secure $68 Million Settlement with Colony Ridge Developers to Halt “Illegal Alien Haven”
Texas Attorney General Ken Paxton and the U.S. Department of Justice, represented by Assistant Attorney General for the Civil Rights Division Harmeet Dhillon, have reached a landmark $68 million settlement with the developers of Colony Ridge. The agreement resolves long-standing allegations that the sprawling development in Liberty County operated as a predatory lending scheme specifically targeting Hispanic immigrants and serving as a hub for illegal immigration.
Deep Search: Terms of the Settlement
The court documents outline strict financial and operational penalties for the developers, including a mandatory $68 million payment. Of this total, $20 million is earmarked specifically for law enforcement infrastructure, such as the construction of a new police station within the development. The remaining $48 million will fund essential community improvements, including flood control, sewage systems, and road repairs—areas where the development was notoriously deficient.
Beyond the financial penalties, the settlement imposes a three-year freeze on the platting of new residential lots for direct-to-consumer sales. It also mandates rigorous new lending standards and buyer identification requirements, explicitly prohibiting sales to citizens of certain foreign nations, including China and Iran.
“The settlement is the result of a joint effort by the OAG and the DOJ to secure justice,” Paxton stated. “The agreement effectively halts the development of a de facto illegal immigrant community.”
Harmeet Dhillon echoed these sentiments, framing the victory as a warning to other entities. “This DOJ will go after all lenders, financiers, and land developers who participate in schemes which ultimately encourage illegal immigration,” Dhillon said, characterizing the developers’ actions as a “predatory scheme” that trapped vulnerable borrowers.
Background: The Controversy Surrounding Colony Ridge
Colony Ridge, located approximately 40 miles northeast of Houston, has been a focal point of intense political and legal scrutiny for years. The development, which grew rapidly to house tens of thousands of residents, was accused of using deceptive trade practices to sell flood-prone land to low-income buyers without proper credit checks.
The Department of Justice and the Texas Attorney General’s office alleged that the business model relied on a “foreclosure mill” strategy. By offering high-interest seller-financed loans to buyers who could not afford them—often providing contracts only in English to Spanish-speaking customers—the developers allegedly churned through properties, foreclosing on them and reselling them repeatedly. The foreclosure rate in Colony Ridge was reportedly significantly higher than the national average.
Conservative lawmakers and media outlets had frequently cited the area as a national security concern, labeling it a “sanctuary” for undocumented immigrants and arguing that the lack of infrastructure allowed cartels and criminal activity to flourish unchecked.
Objections and Developer Response
While state and federal officials have hailed the settlement as a decisive victory for the rule of law and border security, the developers of Colony Ridge have historically pushed back against the characterizations of their business. Throughout the investigation, CEO John Harris and other representatives denied creating a haven for crime or illegal immigration, arguing that they were simply providing affordable housing options to an underserved demographic.
Defenders of the development have previously suggested that Colony Ridge was being unfairly targeted for political gain amidst broader national debates over border policy. Additionally, while the settlement secures millions for infrastructure and law enforcement, some consumer advocates may argue that the agreement focuses heavily on state enforcement priorities rather than direct financial restitution for individual families who lost their homes due to the alleged predatory lending practices. The developers have not admitted to liability as part of the settlement terms.
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