A legal settlement involving the State of Texas, the federal government, and the controversial Colony Ridge development in Northeast Houston will now require prospective buyers to verify that they are living legally in the United States — by presenting a valid Texas-issued identification card or driver’s license, or proper immigration documentation such as a passport with a current visa.
The new guidelines follow a long legal battle, hundreds of criminal arrests, and a pattern of alleged illegal sales tactics by the development’s leaders.
A copy of the settlement agreement was published by the Department of Justice on Tuesday. It comes after the DOJ, the Consumer Financial Protection Bureau (CFPB), and Texas Attorney General Ken Paxton took legal action against Colony Ridge, claiming the company not only used deceptive sales tactics but also offered predatory loans that targeted Hispanic buyers.
The federal lawsuit, originally filed in December 2023, accused Colony Ridge of targeting tens of thousands of Hispanic borrowers with false statements and predatory loans. Colony Ridge accounted for 92% of all foreclosures in Liberty County between 2017 and 2022, according to the CFPB.
“Intentionally targeting vulnerable borrowers with the American dream of homeownership and then trapping them in a predatory scheme is not only wrong, it also violates our civil rights laws…The changes required by this settlement will promote public safety, and affordable and sustainable homeownership in America,” said Assistant Attorney General Harmeet Dillon.
In response, Colony Ridge has claimed it committed no wrongdoing, but agreed to the settlement and its $68 million impact on the developers in order to bring the legal dispute to an end.
Under the settlement, Colony Ridge must require buyers to present an unexpired Texas-issued driver’s license or identification card, or a valid passport and visa. However, the company must also take steps to confirm buyers are not on terrorism watch lists or affiliated with foreign criminal organizations, and verify compliance with Texas laws restricting certain real estate sales involving buyers from foreign countries.
The agreement further requires Colony Ridge to spend at least $48 million on “infrastructure improvements” within the existing subdivisions, including $18 million dedicated solely to drainage and flood control and $30 million for roads, water, sewage, and other public-safety expenses. Independent Texas-based engineering firms must now reevaluate the development’s drainage systems, design improvements capable of handling major storm events, and run recurring inspections.
Another $20 million must be allocated to increasing law enforcement presence in the area over the next decade. Those funds may be used for more local patrols, building DPS or county law enforcement stations, more officers and equipment, and even expanded immigration enforcement in the area.
Advertising practices will also be tightly constrained. Colony Ridge may no longer market properties as “move-in ready” or fully serviced unless utilities at the homes are immediately available, something the company was accused of misrepresenting in the past. The company must also use images of actual properties and provide disclosures and consumer materials in both English and Spanish.
To ensure the development is following the new agreement’s guidelines, the settlement also states that Colony Ridge must hire an “independent compliance specialist” and submit detailed annual reports to state and federal authorities. If the developers violate the agreement, the government may have the right to reopen the lawsuits.
Colony Ridge became a focal point in Texas immigration debates after reports surfaced alleging deceptive marketing practices targeting Spanish-speaking buyers and its seller-financed mortgage model that resulted in high foreclosure rates. The development, located about 30 miles northeast of Houston, became one of the fastest-growing in America, with an estimated population between 70,000 and 100,000 residents spread across approximately 60 square miles in Liberty County.
In March of 2025, ICE agents ran a major operation in Colony Ridge that resulted in 118 arrests of illegal aliens for various offenses, including murder and child sexual abuse, as previously reported by The Dallas Express.
“Under my watch, Texas will never be a sanctuary for illegals,” Attorney General Paxton said in a statement announcing the settlement. “Colony Ridge endangered American citizens by allowing illegal aliens to run rampant on its streets, in its schools, and in its community. Now, it’s time for those responsible to pay a steep cost for their unlawful actions.”
John Harris, CEO of Colony Ridge, said the company was ready to move forward. “We’re happy to resolve these lawsuits and move forward serving our growing community,” Harris told KDFM News. “The settlement allows us to continue investing in our neighborhoods and supporting the thousands of families who have trusted us to provide a place for them to call home.”
