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Thursday, November 5, 2015

A tale of corruption still in the telling

In trying to suppress information that explains why South Dakota is  ranked as one of the most corrupt states in the nation, the state tries to portray matters such as the EB-5 fraud and the MCEC bunco as matters of a few people who have gone rogue.  In the EB-5 affair, it first put the blame on Richard Benda,  largely because he was dead and beyond being able to show and tell who was all involved in the scheme.  Now that the scandal will not go away and the federal government is excluding the state from any more EB-5 activity,  it is taking civil actions against a principal player in the affair, Joop Bollen.  

Bollen has been documented in numerous violations of law and policy,  but he has been exempted from any accounting that, as many university faculty have pointed out, would be required of any other person.  The question, of course, is why?

The story goes back to when Bill Janklow eliminated anyone with professional education experience from the Board of Regents.  His appointees were largely lawyer cronies, and when he had one woman on the board who was a former teacher and not a member of Janklow's clique, he and his cronies drove her off the board.  They did not include her in any board communications and did not notify her of meetings.  They got rid of her and thereby eliminated any perspective on the board that addressed issues of learning and scholarship.  It is in that context that the focus on EB-5 finances had its origin.  

In 1991,  Northern State University was declared by the Board of Regents a Center for Excellence in International Business.  There was confusion on the NSU campus and much criticism from its sister campuses about this designation.  It was assumed that, following the patterns of other institutions for such programs,  that students would pursue a course of study that entailed  rigorous education in foreign cultures and languages and the way other countries do business.  Northern had developed a history with Saudi Arabian and Chinese students, and initially there was some effort to expand the course offerings. In 1994, the Board of Regents incorporated the South Dakota Institute of International Business at Northern and named Joop Bollen its director. 

NSU had on staff a former Peace Corps volunteer who knew Mandarin and a linguistics professor who was Chinese and offered a course in Mandarin and specialized teaching of English as a Second Language.  However, the College of Business, or whoever was presiding over the international program,  divorced itself from any cooperation and coordination with other academic departments and established its own programs.  It set up its own English department.  There was a noticeable diminishing of the role of the College of Arts and Sciences on the campus as changes were made to accommodate the new international program.

As the EB-5 scandal broke and officials at Northern were questioned about Joop Bollen's activities, comments by the School of Business dean made clear that he understood Bollen was not accountable to him through any line of authority.  By this time the SDIBI was associated with the Governor's Office of Economic Development and the assumption was that  that Bollen was accountable to that office.   But the Governor's office also denied knowledge of or responsibility for Bollen's activities.  Among faculty and other informed people who understood the mission of the universities,  his role was a puzzle.  In a story in the Minneapolis Federal Reserve Bank newsletter, he  was quoted:  
"We're closing the gap between academia and business," says Joop Bollen, SDIBI director. "Business people say, 'What do they know, they haven't done it.' But we have shipped cars to Romania and tea to Switzerland," Bollen adds.
To professors throughout the state, the quote was met with the questions of what that had to do with the mission of a university in teaching and research and just who in the hell was sponsoring this person?  When President James Smith took charge at Northern,  he apparently asked the same question.  In dealing with budget matters,  he saw that the University was contributing hundreds of thousands of dollars to the SDIBI whose activities by then were devoted to economic schemes which were irrelevant to education or research as defined by university mission.   He closed down the SDIBI and evicted Bollen's operation,  which found refuge in the offices of the Aberdeen Development Corporation, which was a major supporter of the Northern Beef Packers plant for which Bollen was raising EB-5 money   When Bollen left the Northern campus,  he took all the records of his activities with him.

Cory Heidelberger noted in South Dakota Magazine that Bollen committed a number of legal violations in his activities.  There was never an attempt by anyone in authority to use the law to rein him in.  Although a civil suit was recently brought against him by the Attorney General's office, it appears more as a ploy to defend the Attorney General from accusations of misfeasance while protecting Bollen from answering to criminal charges.  The Attorney General's office has demonstrated how ferocious it can exercise its law enforcement authority in the case it supported against Brandon Taliaferro, a Brown County deputy state's attorney and Shirley Schwab, a child advocate, who were working on a child abuse case.   When Taliaferro found that the Department of Social Services was not properly discharging its responsibilities to some Indian children in a faster home,  he also found that Brown County State's Attorney Kim Dorsett had a contract to act as counsel for the department.  This among other things enraged her and she, with the full support of Attorney General Marty Jackley filed charges of witness tampering and suborning perjury against Taliaferro and Schwab.  The Division of Criminal Investigation, which is under the command of the attorney general came into the offices and homes of Taliaferro and Schwab and, under subpoena, confiscated their records, including their persona computers.  It was not a problem at all to get a search warrant.  

So, now Bollen is served with a civil suit which asks for some indemnification and the surrender of any records produced by Bollen's work for the state.  The question is why dither around with a civil suit when the state has the right to subpoena the records under state law.   It did not hesitate to execute search warrants on Taliaferro and Schwab, although the case involved was dismissed for lack of evidence by the judge.  

1-27-10. Records as property of state--Damage or disposal only as authorized by law.  All records of public officials of this state required to be kept or maintained by law are the property of the state and may not be mutilated, destroyed, transferred, removed, or otherwise damaged or disposed of, in whole or in part, except as provided by law. 
 22-11-25 Unlawful retention of public record--Misdemeanor. Any person who, lacking the authority to retain a public record in his or her possession, knowingly refuses to deliver it up upon proper request of any person lawfully entitled to receive such record, is guilty of a Class 2 misdemeanor. However, if the knowing refusal to deliver is committed by a public officer or employee having custody of the record, the offense is a Class 1 misdemeanor.
Under those terms,  the state has the right and means to execute a search warrant and obtain its records.  Instead, it takes civil action which can permit a lot of negotiation and deal-making and produce a "settlement" agreeable to the parties.  

How does Bollen get such deferential treatment when the state can take such decisive action and file criminal charges as it did against Taliaferro and Schwab?  Bollen had a special status while he worked at NSU, as he was clearly designated an untouchable.  The Board of Regents created his job and established the South Dakota International Business Institute under its own incorporation.  Since the early 1980s,  NSU had a number of presidents who held their jobs not because they had the credentials and experience to be chief academic officers, but because they gave obsequious service to the Board of Regents.  

The longtime regent from Aberdeen is Harvey Jewett, IV, who until recently has been listed as a partner in the law firm of Siegal, Barnett, and Schutz.  Jewett has been chair of the Board of Regents and in addition to being an executive in the Super 8 hotel business has been much involved in the business of Hutterite colonies.  A member of the law firm, Jeff Sveen, has organized the incorporation of a number of Hutterite colonies and acted as their registered agent.  A number of the colonies are owners of Dakota Turnkey Growers, LLC, which operates the Dakota Provisions turkey processing plant in Huron,  which was established with EB-5 funds.  Sveen is the registered agent for the corporation and chairman of the board.  He is Joop Bollen's attorney.

Bollen seems safe from any applications of  law.  

1 comment:

Anonymous said...

You have hit the nail squarely on its head! Millions of missing dollars in the EB5 corruption, Bollen guilty of numerous crimes not the least of which is the theft of state records (Remember, Jackley went after a kid for the theft of a SD state flag left in his custody at the SOS office but not after Bollen for the theft of records representing millions of dollars of missing monies?!).

Lets not forget how aggressively Jackley went after used up political pawn Annette Bosworth and others.

Jackley has obvious conflict of interest on the EB5 corruption; however, he has never recused himself and no arrests, indictments, or convictions on anything regarding the unexplained losses of millions of investment dollars that appear to have disappeared.

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