News, notes, and observations from the James River Valley in northern South Dakota with special attention to reviewing the performance of the media--old and new. E-Mail to

Saturday, October 10, 2015

The guns of autumn, the raids on education

The guns of autumn have taken on an ominous significance in South Dakota.  In October of 2013, Richard Benda told friends and family he was going pheasant hunting. On Sunday, the 20th, he went to Lake Andes to the  farm of his sister and brother-in-law.  On the 22nd of that month, his brother-in-law found his body on an abandoned farmstead nearby.  The attorney general's office officially termed the death a suicide, although decisions and statements coming from Pierre are notoriously untrustworthy. The official report said he died of a self-inflicted shotgun blast to the stomach.  

The abandoned farmstead where Richard Benda's body was found. 
Benda's death triggered the release of information about an economic development program he was involved in with the Governor's Office of Economic Development,  the EB-5 investors, Northern Beef Packers, and the South Dakota Regional Center.  Benda has been accused of embezzling money  about which number of people had knowledge and complicity.  But the powers that have arranged to bury those complications in the copse of autumn trees where Benda's life ended.

In the early hours of the morning of Thursday, Sept. 17, firemen were dispatched to the $1.3 million home of the Scott Westerhuis family near Platte.  They found six bodies in the smoldering ruins.  Scott, his wife, Nicole, and their four children, Michael, 16, Connor, 14, Jaeci, 10, and Kailey, 9, were all found dead by shotgun blast.  The Attorney General's official statement said Scott killed off his family,  set the house on fire and then turned the gun on himself.   

The ashes of the Westerhuis house where the family's six bodies were found.

These deaths, too, prompted the release of information about financial dealings.  Scott Westerhuis was the business manager for the  Mid-Central Education Cooperative and Nicole was assistant business manager.  Hours before the massacre and arson, the cooperative had been notified by the state Department of Education that a contract for administering a $4.3 milion federal grant with the co=operative was being canceled.  Records from administration of the  grant show officials listed as consulting administrators with high stipends and the creation of a layer of non-profit corporations to implement the grant to prepare American Indian youth for college. Audits of the grant raised questions about the administration of the grant, but the specific points of examination that raised the question have not been explained.    The cancellation of the contract leaves the GEAR UP program for the native American youth in limbo. 

To experienced academics who have obtained and administered grants, the numerous and exorbitant consulting fees, the layers of non-profit corporations to administer the grant, and vague accounting of just what was being paid for are incomprehensible.  The target benefactors of the grant are young native American students who the interest and ability to go to college and to provide them with educational experiences and skills that will enable to get into and succeed in college.  The questions that immediately occur to bona fide mentors are just what kind of academic program was devised for these students and what percentage of money was directly expended on the students?  The administrative arrangement appears to be an obvious scheme to bleed off the funds through an elaborately contrived system of graft.  

What the EB-5 scheme and the  Mid-Central Education Cooperative have in common is that educational programs is that they used educational cover to manipulate money from government programs into the private pockets.  The EB-5 scheme had its origins in the South Dakota International Business Institute at Northern State U.  Faulty both on that campus and its sister institutions questioned just how the activities of the SDIBI benefitted involved academic research and benefitted students.  The question was never answered. However, a new president at NSU apparently asked just how money from the university budget for the SDIBI was applied to educational purposes and found that actually was not.  So, he ended the program as part of the university and its director moved off the campus into the offices of the Aberdeen Development Corporation and took all the records which purported to show what the program was doing with him.  While the university was not involved, the director of the program was able to write a contract with himself to establish the South Dakota Regional Center which recruited and collected the EB-5 investments from Korean and Chinese investors.  In doing so, he did things, including getting sued, under the cover of the Board of Regents in a messy tangle of financial manipulations.  The South Dakota Gojvernor's Office of Economic Development and the Board of Regents have managed to maneuver and obfuscate evade any accountability for the schemes that w ere hatched in the name of education and the taxpayers of South Dakota.

The Mid-Central Education Cooperative was  not so wily in setting up GEAR  UP program.   Audits turned up suspicious items that apparently the cooperative could not explain and, as with the EB-5 affair, ended in a blaze of shotgun fire and suicide.  

The pattern of scamming education is not peculiar to South Dakota.  The former superintendent and CEO of the Chicago Public Schools and her cronies got caught doing the same kind of thing.  Rather than choose suicide,  she is pleading guilty.  And rather than cover up the scheme, as is possible in South Dakota,  the U.S. attorney is prosecuting.  

Barbara Byrd-Bennett, 66, the former Chicago Public Schools CEO and superintendent, was charged with 15 counts of mail fraud and five counts of wire fraud. She was cooperating with prosecutors and has agreed to plead guilty, 
U.S. Attorney Zachary Fardon said during a press briefing. Fardon said Byrd-Bennett abused her position "to line her own pockets and those of her co-defendants." The indictment says the scheme netted Byrd-Bennett and her two co-defendants about $2 million in cash and other valuables, which prosecutors will seek to recover. Byrd-Bennett helped her former employer, an educational training and consulting collective, secure lucrative no-bid contracts for city schools, according to the indictment. In exchange, Byrd-Bennett received hundreds of thousands of dollars in kickbacks, which the collective disguised by funneling them into bank accounts set up under the names of Byrd-Bennett's relatives, the indictment alleges.  
The educational collective lavished the former schools chief with perks, including meals, travel and sports tickets, and promised her another job with more kickbacks disguised as a signing bonus after she stepped down from from the superintendent's post, the indictment says. 

The big difference between corruption in Chicago and South Dakota is that in 

Chicago it gets exposed land prosecuted.

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Aberdeen, South Dakota, United States