Here are a few questions and answers to help you understand the latest developments in the investigations involving the South Dakota economic development office.
1. Who is being investigated?
South Dakota Economic Development Office Governor Dennis Daugaard says alleged financial misconduct in the state economic development office prior to his administration is being investigated on a state and federal level. With the federal statute of limitations that puts the investigation under the Governor Mike Rounds administration and Richard Benda who was the Secretary of Tourism and State Development from 2006-2010. However, South Dakota Attorney General Marty Jackley says Rounds was not and is not the target of a state investigation.
Northern Beef Packers Officials with the bankrupt Aberdeen beef plant say federal investigators have asked them about their finances and the use of the EB-5 program.
South Dakota Regional Center Tuesday a United States Citizenship and Immigration Services spokesman told KELOLAND News the South Dakota Regional Center is being investigated by the FBI. The SDRC worked closely with the state development office to recruit investors for the beef plant through the EB-5 program.
2. What is EB-5?
EB-5 is a federal program that is used to recruit foreign investors to American projects with the promise of eased immigration for their families. The program is administered by United States Citizenship and Immigration Services. Typically investments of $500,000 per person are made for projects.
3. What is the South Dakota Regional Center?
The South Dakota Regional Center was established in 2008 to help administer and promote the EB-5 program in South Dakota on behalf of the state development office. SDRC essentially served as the middleman between the state economic development office and foreign investors who were interested in South Dakota projects. SDRC’s contract with the state was terminated in September of 2013.
4. Who is Joop Bollen?
Joop Bollen established the South Dakota Regional Center which is being investigated by the FBI. He lives and works at the SDRC office in Aberdeen. He was involved in a series of lawsuits with Chinese investors in the Northern Beef Packers plant in 2011 and 2012. The investors accused Bollen of mismanaging their investments and misrepresenting the financial status of the beef plant. Bollen says in his lawsuit that Chinese EB-5 consultant Henry Zou was trying to use the investor lawsuit to ‘sabotage’ the plant after Zou wasn’t paid his commission for recruiting investors.
5. How is former South Dakota Tourism and State Development Secretary Richard Benda tied to this?
Benda traveled to China while he was the Secretary of the South Dakota Tourism and State Development Office to help recruit investors for the beef plant. After leaving the state development office in 2011 he worked to monitor the EB-5 investments that the South Dakota Regional Center had recruited for the beef plant. Benda was found dead of a gunshot wound in October in a grove of trees near Lake Andes, South Dakota. The South Dakota Attorney General’s Office is still trying to determine if Benda’s death was an accident, suicide, or foul play.