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AG seeks strengthened conflict of interest legislation

South Dakota Attorney General Marty Jackley is urging the Legislature reconsider conflict of interest legislation in 2017. Jackley praised the recently-approved legislation to create a seven-member Board of Internal Control to deter the recent st...

South Dakota Attorney General Marty Jackley is urging the Legislature reconsider conflict of interest legislation in 2017.

Jackley praised the recently-approved legislation to create a seven-member Board of Internal Control to deter the recent string of corruption scandals in South Dakota during a visit to The Daily Republic's office Wednesday, but he suggested the Legislature hold a discussion to add more teeth to the state's corruption laws during the 2017 session.

Senate Bill 162, the work of Lt. Gov. Matt Michels, will allow the board to establish a system of internal controls and a conflict of interest policy for use by state agencies. But Jackley said a direct criminal conflict law should be discussed to target people involved in corruption cases like those at the Mid-Central Educational Cooperative and with the EB-5 program.

"What I mean by that is I don't want the fox guarding the henhouse," Jackley said. "When you have a situation when somebody is serving on a board and they're the oversight of something, they shouldn't be the oversight of the contract they're making money from."

In March, Jackley announced charges against two Mid-Central employees and another person associated with the cooperative with illegal activity ranging from altering documents to theft. These charges were announced about six months after Scott Westerhius, the cooperatives former business manager, was found to have murdered his family and set his home ablaze before killing himself.

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The Mid-Central situation arose after the state Department of Education terminated the cooperative's GEAR UP contract, which services a program helping students from low-income families.

While SB 162 established a new section of law allowing a state employee to notify their immediate supervisor, the Department of Legislative Audit or the attorney general's office when they suspect a conflict of interest, fraud or theft, Jackley hopes the Legislature considers turning that "or" into an "and" to make sure any future attorneys general are in the loop on potential major fraud cases.

"The attorney general should have known that there was this significant of financial concerns before he receives a phone call at 9 a.m. from a DCI agent saying 'We are roping off half a town and we are worried that six bodies may be in this fire and we're suspicious that they didn't get out,' " Jackley said.

Lastly, and perhaps most controversially, Jackley is looking to make some levels of direct conflict a felony.

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