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Obama's Pick for DHS No. 2 Set for Grilling on Hill

Alex Wong/Getty Images(WASHINGTON) -- President Obama's pick for a key national security post is set to be grilled on Capitol Hill Thursday over allegations of misconduct, specifically that he "personally facilitated and assisted" the approval of a visa application for a politically connected foreign investor.

The president's nominee to be the No. 2 at the Department of Homeland Security, Alejandro Mayorkas, is expected to launch a vigorous defense to lawmakers denying any wrongdoing. He is one of several officials under internal investigation by the DHS inspector general, according to a letter to Congress from the inspector general's office obtained by ABC News.

The investigation also involves Virginia gubernatorial candidate Terry McAuliffe, a Democrat who repeatedly appealed to senior DHS officials, including Homeland Security Secretary Janet Napolitano in 2010, for assistance in obtaining visas for investors in his electric car manufacturing firm GreenTech. The U.S. visa program, commonly known as EB-5, provides American visas to foreign investors who invest over $500,000 in American companies.

Mayorkas, who currently leads the U.S. Citizenship and Immigration Services agency, is being investigated for allegedly intervening on behalf of a company run by Hillary Clinton's brother, Anthony Rodham, called Gulf Coast Management LLC, which tried to get visas for investors in GreenTech. McAuliffe, who resigned as GreenTech's chairman last year, often touts his business record on the campaign trail.

A letter from the inspector general pointed out that "we do not have any findings of criminal misconduct" by Mayorkas.

USCIS officials originally rejected the company's application, according to e-mails obtained by the office of Sen. Chuck Grassley, R-Iowa, and shared with ABC News.

In the emails shared with ABC News, Mayorkas promised to "follow up" on complaints that the visa review process was taking too long. The emails do not show Mayorkas applying pressure to officials. However, the letter from the DHS inspector general said its months-long probe has produced allegations of "an appearance of impropriety by Mayorkas and other USCIS management officials."

The top Republican on the Senate Judiciary Committee, which is probing Mayorkas' nomination on Thursday, said the EB-5 program raises national security concerns.

"We need to be sure that the EB-5 program is not only creating economic stimulus and jobs, but that the nation's security isn't at risk," Sen. Grassley said in a statement Wednesday.

In one case cited by Grassley, Rodham's firm, Gulf Coast Funds Management, sought a visa for a GreenTech investor who was a vice president of Huawei Technologies, a Chinese telecommunications firm investigated last year by the House Intelligence Committee over alleged ties to Chinese intelligence services. Huawei Technologies has previously said those charges were not true. They did not return a phone call or email from ABC News seeking comment.

Throughout the gubernatorial campaign, Republicans have attacked McAuliffe over his attempts to secure a channel for GreenTech investors to legally receive U.S. visas in exchange for their investments. A spokesperson for McAuliffe called the allegations a Republican distraction. The issue is likely to be raised by Republicans Thursday at the congressional hearing on Mayorkas' nomination.

In the emails obtained by Grassley's office, USCIS officials flagged the Huawei vice president's so-called EB-5 visa filing and the House Intelligence Committee's probe of that company as an area of concern.

"I highly recommend that this information be considered prior to granting the expedite request to this regional center," one official wrote in February.

At one point, an FBI official requested information on all investment companies affiliated with the EB-5 program. The FBI's San Diego field office and other federal buildings had been constructed with Chinese investment money obtained through the EB-5 program, through another company unrelated to Gulf Coast, according to Grassley's office -- raising concerns among FBI "higher ups" according on the FBI official's email.

Chris LaCivita, a senior advisor to the Republican nominee for governor in Virginia, Ken Cuccinelli, said from their point of view GreenTech and Gulf Coast Funds management are one in the same.

"From our standpoint Gulf Coast describes itself as the sister company of GreenTech," LaCivita told ABC News. "GreenTech was formed, put together, and financed by Terry McAuliffe. Gulf Coast runs the EB-5 program for one client: GreenTech. This individual with DHS is being looked at for approving an EB-5 visas for this organization. Gulf Coast pursued a visa for Huawei Technologies. Huawei Technologies is considered a threat to the United States of America by the House Intelligence Committee. Why would Terry McAuliffe's firm pursue and push for a visa to an organization that is hostile to the United States of America? I'll tell you why, for the almighty dollar."

They already have an ad linking McAuliffe to business in China. LaCivita said he expects this story to also make its way to Virginia's airwaves as well.

A Republican super PAC, America Rising, has filed a Freedom of Information Act request asking for "all records of physical and or electronic correspondence, memoranda, scheduled meetings and records of phone calls" regarding the decision to invite McAuliffe, as well as GreenTech executive Charles Wang and Rick Wade, to a State Department luncheon on Feb. 14, 2012. The luncheon honored Xi Jinping, then-vice president, now-president of China, and was hosted by Vice President Joe Biden and Secretary of State Clinton. The request included photographs of Wang with Biden, Wang with Clinton, and McAuliffe talking to Xi. The group wants to know why McAuliffe, Wade and Wang were invited to the luncheon and if it was connected to their desire for the EB-5 visas for their company.

The letter from the DHS IG does not mention McAuliffe by name and their campaign is noting that, saying in a statement from press secretary Josh Schwerin that they believe the "investigation does not involve Terry and we hope that it is completed in a timely matter."

McAuliffe's campaign said the attacks from Cuccinelli's campaign are instead an "attempt to distract from his ties to the Star Scientific scandal."

"It's surprising that Cuccinelli would grandstand on this issue since his corporate patron Star Scientific is the subject of multiple investigations," Schwerin said in a statement. "Instead of avoiding questions and accountability, Cuccinelli should release the file his office compiled for his campaign about Star and return the gifts he accepted when he was supposed to be pursuing the company for unpaid taxes."

Schwerin is referring to the scandal currently embroiling Virginia Gov. Bob McDonnell's office and hanging over the governor's race. McDonnell, a Republican, and his family accepted gifts from Star Scientific CEO Jonnie Williams and he is at the center of the growing scandal. Cuccinelli admitted to also accepting gifts from Williams and not disclosing them, including stays at a vacation home, but he was cleared last week of any legal wrongdoing by the Richmond Commonwealth's Attorney in an independent investigation requested by Cuccinelli.

A DHS spokesperson declined to comment.

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