Following two days of hearings in the GEAR UP case, attorneys on both sides have been filing arguments for holding back or allowing evidence in the upcoming trial of the three people facing charges.

The state is trying to show that former Mid Central Director Dan Guericke, former Mid Central Assistant Business Manager Stephanie Hubers and American Indian Institute for Innovation Head Stacy Phelps all conspired to help Scott and Nicole Westerhuis to either continue or cover up their illegal dealings with grant money and that in some way all three defendants benefited from that.  

Defense attorneys for the three say they’re just being set up to unfairly take the fall in the GEAR UP fiasco and much of the state’s evidence shouldn’t be allowed at trial. 


One of the toughest questions to prove in this trial may be what did Guericke know and when did he know it?  We have some insight from Guericke’s interview with DCI agents and how some of his own words may be used against him at trial. 

A few weeks after the Westerhuis murders and suicide, Guericke was still heading Mid Central Board Meetings, but he wasn’t answering questions.

Angela Kennecke on October 8, 2015: Can I ask you why you didn’t have more oversight of the GEAR UP grant funds?
Guericke: That’s a confidential matter with our attorney.    

Four months later, Guericke and Mid Central Attorney Scott Swier sat down with DCI agents to answer their questions. 

Guericke appeared to be in shock when agents told him that for years the Westerhuises had been funneling Mid Central’s money to their other organizations and at some point, quit paying it back.

“They were using us as a bank. Wow,” Guericke said.


Guericke did admit that there had been a bad audit and that Stephanie Hubers was taken off of reconciling the books and that job was assigned to Nicole Westerhuis.  

Auditor Randy Schoenfish, who did Mid Central’s audits for decades, testified in the hearings that there were red flags raised in the educational cooperative’s audits, and that he met with Guericke, Hubers and the Westerhuises about the discrepancies, but he didn’t know if they ever took any action. 

The state alleges that Hubers kept secret books of what was really going on with the money to hide the Westerhuises’ activities.

When agents told him that the Westerhuises had funneled $4.4 million to AIII and OSEC between 2011 and 2015, Guericke told them, “I’m really naive when it comes to accounting and everything.”

Prosecutors allege that Guericke wasn’t so naive because he backdated several contracts to hide what was going on from state auditors. 

Attorney General Marty Jackley also points to bogus GEAR UP performance numbers Guericke gave to the Government Operations and Audit Committee. 

“Those students that go through the work during the school year, that enroll in the summer program and graduate from high school, we have a 98 percent graduation rate from high school and we have about 95 percent of them going on to post-secondary education, which given the population of students we’re targeting is extremely high,” Dan Guericke told GOAC on August 25, 2015.

Our KELOLAND News Investigation revealed that there was no data kept to show a single Native American student went to college because of the GEAR UP program. 

The judge in the GEAR UP case, Bruce Anderson, will make a decision on what evidence will be allowed in trial and what won’t. But no future hearing date has been set yet. 

Meanwhile, as KELOLAND Investigates first reported last week, 20 lawmakers are calling for a public hearing by the Government Operations and Audit Committee into the involvement of state agencies, departments, institutions and boards in GEAR UP.
GOAC Chairwoman, state Senator Deb Peters says lawmakers will get a history of what GOAC has already done at its next meeting.

That meeting is April 25 and South Dakota Auditor General Marty Guindon is expected to present the findings of a special audit that followed taxpayer funded grant money beyond Mid Central to other organizations like AIII and OSEC. 

Guindon tells KELOLAND News that after the first draft of the report, his department had to gather more information and that the audit should be complete by next week.