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A guide to the EB-5 program investigation in SD

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A guide to the EB-5 program investigation in SD
Mitchell South Dakota 120 South Lawler 57301

Republican and Democratic lawmakers hope to delve deeper into the scandal involving an investment-for-green-card program at the Sept. 24 Government Operations and Audit Committee meeting in Pierre. Here's a look at key elements of the investigations into the reported misappropriation of money in the Governor's Office of Economic Development and the death of its former commissioner:

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LATEST: Republican Sen. Larry Tidemann, the committee chairman, said Wednesday he sent letters this week to Joop Bollen, the former administrator of the visa program in South Dakota, and U.S. Attorney Brendan Johnson. Tidemann said he'd like Bollen to give a chronology of the program and asked Johnson to update the committee on any criminal investigations.

Also Wednesday, Democratic candidate for governor Rep. Susan Wismer asked that another member of her party sit in on the September meeting, saying she's willing to step aside if her campaign creates a conflict.

On Tuesday, Democrats Sen. Larry Lucas and Rep. Bernie Hunhoff renewed and expanded a request for testimony at the meeting to include Republican Gov. Dennis Daugaard, former GOP Gov. Mike Rounds, Bollen and his Aberdeen lawyer, Jeff Sveen. Lucas and Hunhoff gave the four until Sept. 3 to accept the invitation and then vowed to issue subpoenas. The Democrats also demanded access to financial documents. The committee earlier asked for written answers, and Daugaard's office said he would provide them.

BACKGROUND: The EB-5 investment visa program allows people to seek U.S. residency if they invest at least $500,000 in approved projects. It is under scrutiny because of allegations of financial misconduct at GOED, which oversees the program. An audit found that before Richard Benda left his job as GOED commissioner in 2010, he tacked on an extra $550,000 to a grant agreement to help the struggling Northern Beef Packers plant in Aberdeen. As commissioner, he had that ability. But a report from Attorney General Marty Jackley showed the same amount was improperly diverted to Benda's new employer, SDRC Inc., which was led by Bollen and administered the EB-5 visa program at the time. Local, state and federal agencies concluded Benda committed suicide in October.

CRIMINAL CASE: Jackley released in July a draft of a complaint against Benda that would have charged him with three alternate felony counts alleging that he illegally obtained $550,000 intended for Northern Beef Packers and that he double-billed the state $5,560 for three flights to China and Las Vegas. Journalist Bob Mercer couldn't secure records through an administrative law process and has sued Jackley seeking more information about Benda's death.

MISSING MONEY: Daugaard's office said that he is considering filing a lawsuit to recover the $550,000 and that a private lawyer has been working for months to determine whether the state can reclaim the money, if it's accessible.

SENATE RACE: During a debate in Mitchell, Rounds' opponents for U.S. Senate challenged the Republican to release additional information he knows about EB-5. Rounds said he's cooperating with state and federal investigators.

BEEF PLANT: Northern Beef Packers filed for bankruptcy last summer and was sold in December to White Oak Global Advisors LLC, a California-based investment firm. Doug Cooper, CEO of the renamed New Angus plant, said he is working on a five-year plan with a goal of eventually employing nearly 600 people and slaughtering up to 1,000 head of cattle per day.

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