WASHINGTON, March 24 (Reuters) - The No. 2 official at the U.S. Homeland Security Department exerted improper influence while at another agency on behalf of politically connected Democrats seeking visas for foreign investors, the department's inspector general said in a report released on Tuesday.
Homeland Security Deputy Secretary Alejandro Mayorkas, when he was head of U.S. Citizenship and Immigration Services, gave special treatment in three cases, including to a company run by now-Virginia Governor Terry McAuliffe, the report found, but it also determined that Mayorkas had broken no laws.
The EB-5 program allows foreigners to obtain visas to live permanently in the United States if they invest $500,000 to $1 million in businesses that create U.S. jobs.
The report called Mayorkas' intervention on behalf of an electric car company run by McAuliffe "unprecedented" and said agency staff saw it as politically motivated.
The Washington Post reported that McAuliffe's company, from which he resigned before running for Virginia governor, was working with Gulf Coast Funds Management, a firm specializing in obtaining EB-5 visas and run by Anthony Rodham, brother of former Secretary of State Hillary Clinton.
Mayorkas also intervened on behalf of a film project in Los Angeles backed by a Democratic Party donor and construction of a casino in Las Vegas supported by Senate Democratic leader Harry Reid, the report found.
Homeland Security Secretary Jeh Johnson said in a statement he had full confidence in Mayorkas, who became the department's No. 2 in 2013. But Johnson said he had directed his general counsel to make changes to the program to make sure it "is free from the reality or perception of improper outside influence."
Mayorkas said in a statement he disagreed with the inspector general's report. He said the program was badly broken when he arrived at the immigration services agency and he had sought to improve it in a "hands-on manner."
(Reporting by Eric Beech; Editing by Peter Cooney)