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SDDP Executive Director Responds to State of the State Address →

SDDP Executive Director Responds to State of the State Address

PIERRE, S.D. – The South Dakota Democratic Party released the following statement from Executive Director Sam Parkinson in response to today’s State of the State Address by Governor Dennis Daugaard:

“40 years of one-party rule has led to one budget shortfall after another, a state government plagued by scandal and which regularly overturns the expressed will of the voters, a state educational system falling behind our neighbors, and a state economy where working families are struggling to get ahead. South Dakotans deserve better leadership than they have received from the Republican establishment in Pierre. South Dakota Democrats are fighting for a state government and a state economy that works for everyone, not those at the top, like the powerful and well-connected special interests who have way too much power in Pierre. It’s time for a change in leadership; this November, South Dakotans will remember who is fighting for them and who is fighting for the special interests.”

Here’s a look at how the Republican leadership in Pierre has failed the people of South Dakota:

  • Working families are having to work harder to make ends meet, and many are falling behind.
    • SD is top in the nation in multiple-jobholding rates, according to most recent estimates available – We’re at 9.1% and the national average is 4.9%
    • We rank second in the nation in the percentage of our families where both spouses are in the workforce – We’re at 61.7% and the national average is 51.2%.
    • We’re 42nd in the nation for median earnings for men and 41st for women, and women in South Dakota earn about $10,000 less than men on average.
    • We have the 7th highest percentage of our elderly population below the poverty level.
    • We have an infant mortality rate higher than the national average.
    • South Dakota has the largest employment gap between American Indians and Whites in the nation.
      • In 2016, the employment rate of White adults in South Dakota was 35.2 percentage points higher than for American Indian adults.
      • South Dakota ranked 49th in the nation for proportion of American Indian adults working at just 45.2% in 2016. By comparison, 80.4% of White adults were at work—the second highest proportion in the nation.
  • State government isn’t working as it should.
    • There’s a profound lack of accountability, and the state isn’t making the smart investments to support an innovative and dynamic economy.
    • SD has been ranked 3rd-most corrupt state in the nation.
    • SD has been named one of the 10 least innovative states in the nation by Forbes.
  • Under our current system of politics as usual, our economy is sputtering.
    • Our low unemployment rate (3 %) can’t overcome other fundamental weaknesses:
      • South Dakota’s economy shrank 0.3% from Quarter 1 to Quarter 2 in 2017. Iowa was the only other state with a negative GDP (-0.7%) in Q2 of 2017.
      • South Dakota’s economy has now shrunk in three (3) consecutive quarters (-2.9 in Q4 of 2016, -5.9 in Q1 of 2017, and -0.3 in Q2 of 2017).
      • Since 2011, Gov. Daugaard’s first year in office, through 2016, SD’s per capita GDP growth has been 0.2% (an average of 0.04% a year).
        • During that period the overall per capita GDP growth in the United States has been 6% – 30 times faster than South Dakota’s.
        • The only neighboring state which has underperformed South Dakota during this period is Wyoming.
      • In 2016, South Dakota’s per capita personal income grew just 0.4%, below the national average of 2.5% in metro areas and 1.0% non-metro areas.
      • Per capita personal income fell in 45 South Dakota counties in 2016 and rose in only 21 counties. County charthere.

Source: The Census Bureau, unless otherwise another hyperlink is provided.

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Republican Budget Cuts Hurt South Dakota Families →

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Republican Budget Cuts Hurt South Dakota Families

SIOUX FALLS, S.D. – The South Dakota Democratic Party released the following statement from Executive Director Sam Parkinson in response to House Republicans narrowly passing a budget bill this morning:

“This Republican budget – voted for last week by Senators Mike Rounds and John Thune, and voted for today by Rep. Kristi Noem – takes money out of the pockets of hardworking South Dakota families and gives it to the top 1 percent. It will make drastic cuts to vital programs like Medicare and Medicaid to give huge tax cuts to wealthy corporations and millionaire and billionaires. Even worse, these tax cuts aren’t paid for. The Republican budget will increase the budget deficit by at least $1.5 trillion, which will in turn be used by Republicans as an excuse to make even deeper cuts into programs that help South Dakota families.

“But while Republicans continue to fight to give more and more to the wealthy and special interests, Democrats will continue fighting to give all working families the economic security and opportunity they deserve.”

Here is a closer look at how the Republican budget will hurt South Dakota families:

MEDICARE:

  • The Republican budget calls for nearly $500 billion in cuts to Medicare.
  • In South Dakota, 156,127 people who rely on Medicare are at risk.
  • Medicare beneficiaries make up 18 percent of South Dakota’s total population, including:
    • Seniors: 87 percent of Medicare beneficiaries in South Dakota are seniors.
    • People with disabilities: 13 percent of Medicare beneficiaries in South Dakota have a disability.
    • Women: 58 percent of Medicare beneficiaries in South Dakota are women.
    • Rural communities: Nearly one in four Medicare beneficiaries nationwide live in rural areas.

MEDICAID:

  • The Republican budget calls for more than $1 trillion in cuts to Medicaid – an even deeper cut than Republicans proposed in their health care repeal bills.
  • In South Dakota 109,100 people who rely on Medicaid are at risk.
  • Medicaid beneficiaries make up 14 percent of South Dakota’s total population, including:
    • Adults: 1 in 12 nonelderly adults in South Dakota.
    • Children: 1 in 3 children in South Dakota.
    • Seniors: 1 in 2 nursing home residents in South Dakota.
    • People with disabilities: 2 in 5 people with disabilities in South Dakota.
    • Women: 65 percent of nonelderly Medicaid beneficiaries in South Dakota are women.
    • Rural communities: Medicaid covers one in four nonelderly rural residents nationwide.
    • Veterans: 4,000 veterans in South Dakota rely on Medicaid services.

NUTRITION & INCOME SECURITY PROGRAMS:

  • The Republican budget calls for deep cuts to programs like the Supplemental Nutrition Assistance Program (SNAP), formerly known as food stamps, and Social Security.
  • SNAP helps 96,000 South Dakota families and workers stay out of poverty and keep healthy food on the table.
    • Almost 75 percent of SNAP participants in South Dakota are in families with children.
    • More than 48 percent of SNAP participants in South Dakota are in working families.
    • Almost 27 percent of SNAP participants in South Dakota are in families with members who are seniors or have a disability.
  • In 2016, SNAP benefits added $145 million to South Dakota’s economy, because families spend their SNAP benefits at local grocery stores and other retailers.
  • 21,041 South Dakotans rely on Social Security Disability Insurance, which workers pay into so they can support their families if they develop a severe disability.

TAX CUTS FOR WEALTHY:

  • By passing their budget, Republicans have cleared the first hurdle in moving forward to a vote on a tax bill that has been written in secret and few have seen. If the Republican tax plan were to pass:
  • The richest one percent of South Dakota residents would receive 62 percent of the state’s total tax cuts in 2018. These households are projected to earn at least $589,600 next year and would see an average tax cut of $129,120 in 2018.
  • In stark contrast, middle-class South Dakotans would only receive 5 percent of the state’s total tax cuts. These households would only get an average tax cut of $500 in 2018.
  • Millionaires alone would get 54 percent of the state’s total tax cuts. Their average tax cut would be 532 times the tax cut middle class families would get.
  • 7 percent of South Dakota households would face a tax hike if the GOP tax plan was in effect in 2018.

OTHER CUTS:

  • CUTS TO EDUCATION AND TRAINING: Nationwide, the Republican budget cuts close to $200 billion from services like Pell Grants and student loan assistance over the next decade.

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ALERT: 10am Friday hearing for GOP’s anti-democratic ballot measure bill

The Senate State Affairs is hearing the GOP’s bill to chip away at your right to propose and vote on laws on Friday, February 6, 2015, at 10am. (You can listen by clicking the podcast link here.) Yellow-Alert

We can stop this bill right now with your help. Will you email the GOP legislators on the Senate State Affairs committee and tell them to VOTE NO?

Sen.Brown@state.sd.us
Sen.Holien@state.sd.us
Sen.Lederman@state.sd.us
Sen.Otten@state.sd.us
Sen.Rave@state.sd.us
Sen.Soholt@state.sd.us
Sen.Solano@state.sd.us

Thank you for your help so far. Now let’s put this issue to bed!

Ann

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UPDATE! Fwd: Are you an emergency?

Over 400 people have signed our online petition to stop the GOP’s assault on your rights to propose and refer laws.

Will you add your name or share this link on Facebook and Twitter?

We need to get 1000 signatures before the Senate State Affairs committee hears this awful bill.

Thank you,

Zach NistlerSign the petition

———- Forwarded message ———-
From: Ann Tornberg
Date: Tue, Feb 3, 2015 at 3:50 PM
Subject: Are you an emergency?

SDDP

Zachary,

Are you an emergency? GOP leaders in Pierre seem to think so.

Here’s what Argus Leader reporter Jonathan Ellis has to say about the GOP’s anti-democratic bill to limit your right to sponsor ballot measures:

“When you hear the word emergency – as in, Emergency! – what comes to mind?

“I think of Japanese planes bombing Pearl Harbor. Or the Titanic ramming an iceberg. Or a burning skyscraper filled with orphans. Those are emergencies.

“But some lawmakers in Pierre have a different sense of emergency. They think that you, the voter, are an emergency. And just like some of those brave sailors who manned anti-aircraft guns to fight back on that Sunday morning at Pearl Harbor, these lawmakers are out to put a stop to you.” – Jonathan Ellis, Argus Leader; 2/2/2015

GOP leaders want to put a stop to South Dakota voters like you who passed an initiated measure to raise the minimum wage and referred measures to stop Governor Dennis Daugaard’s education reform bill and corporate welfare bill.

I have a better idea: Let’s put a stop to the GOP leaders. Let’s get at least 1000 signatures to deliver to the Senate State Affairs before they hear this awful bill.

Will you sign the petition right away?

Thank you,
Ann Tornberg, Chair

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Are you an emergency?

Are you an emergency? GOP leaders in Pierre seem to think so.
Here’s what Argus Leader reporter Jonathan Ellis has to say about the GOP’s anti-democratic bill to limit your right to sponsor ballot measures:

“When you hear the word emergency – as in, Emergency! – what comes to mind?

“I think of Japanese planes bombing Pearl Harbor. Or the Titanic ramming an iceberg. Or a burning skyscraper filled with orphans. Those are emergencies.

“But some lawmakers in Pierre have a different sense of emergency. They think that you, the voter, are an emergency. And just like some of those brave sailors who manned anti-aircraft guns to fight back on that Sunday morning at Pearl Harbor, these lawmakers are out to put a stop to you.” – Jonathan Ellis, Argus Leader; 2/2/2015

GOP leaders want to put a stop to South Dakota voters like you who passed an initiated measure to raise the minimum wage and referred measures to stop Governor Dennis Daugaard’s education reform bill and corporate welfare bill.
Thank you,
Ann Tornberg, Chair

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Ann Tornberg of Beresford Elected SDDP Chair

For Immediate Release: Saturday, December 13, 2014

Ann Tornberg of Beresford Elected SDDP Chair
Joe Lowe of Piedmont Elected SDDP Vice Chair

Oacoma, SD (December 13, 2014) — The South Dakota Democratic Party state central committee elected Ann Tornberg of Beresford Chair of the State Party and Joe Lowe of Piedmont State Party Vice Chair. ann tornberg

Bill Nibbelink of Flandreau was re-elected SDDP Treasurer, and Lorri May of Madison was reelected SDDP Secretary.

Ann Tornberg released the following statement:

“South Dakota Democrats have a lot of work to do to rebuild our county parties, recruit top tier candidates, and register voters. I’m grateful for the support of the State Central Committee and all the hard work our current Chair and State Party staff have accomplished to allow us to start building right away. I look forward to working with my Vice Chair Joe Lowe and Democrats from all parts of South Dakota to build consensus, advance the issues which are important to working families throughout the state, and elect Democrats up and down the ballot.”

The new SDDP leadership team begins their four year terms on January 1, 2015.

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MEMORANDUM: What a Mike Rounds endorsement means

For Immediate Release: Wednesday, October 29, 2014

EB5 Citizenship-for-sale  Kings Joop Bollen & Mike Rounds

EB5 Citizenship-for-sale Kings Joop Bollen & Mike Rounds

MEMORANDUM:
What a Mike Rounds endorsement means

Sioux Falls, SD (October 29, 2014) — The South Dakota Democratic Party released a memorandum to South Dakota editorial boards today as they make final considerations about endorsements in the US Senate race.

South Dakota Democratic Party Executive Director Zach Crago released the following statement:

“South Dakota reporters have done an incredible job fulfilling the mission of the fourth estate to protect the public interest, especially as it relates to the Mike Rounds EB5 citizenship-for-sale scandal.

South Dakota reporters have exposed rank corruption, self dealing, and personal enrichment during the Mike Rounds administration that had previously remained in the recesses of the Rounds administration. Thanks to South Dakota reporters, light is shining on public corruption that was hidden in the shadows.

We hope South Dakota’s editorial boards will honor their reporters’ work by taking into serious consideration what a Mike Rounds endorsement would mean for the public interest.

Transparency, accountability, and honesty still matter to South Dakota voters who look to the the press to protect the public interest. We’re certain these values still matter to South Dakota editorial boards too.”

The memorandum is copied below:

MEMORANDUM

To: South Dakota editorial boards
From: South Dakota Democratic Party
Date: Monday, October 27, 2014
CC: South Dakota public

Subject: What a Mike Rounds Endorsement Means

The press has always played an important role in our political process. As guardian of the public interest, the “Fourth Estate” has traditionally served as a watchdog of government, a warrior for accountability, and a protector of the public’s right to access public information.

In this traditional vein, the South Dakota press has played an outsized role investigating important issues defining the race for US Senate, including the so-called “Citizenship-for-sale” EB5 scandal plaguing the Rounds for Senate campaign. Reporters investigating Mike Rounds citizenship-for-sale scheme have exposed rank corruption, self dealing, personal enrichment, and the resulting cover up of key documents at the expense of the public interest.

A Mike Rounds endorsement would dishonor your reporters’ work, impugn your publication’s journalistic integrity, and risk your paper’s reputation. Consider the following facts:

Corruption: Mike Rounds fostered a culture of corruption in the Governor’s Office of Economic Development.

  1. Rounds employee Joop Bollen stole $108 million in EB5 fees[1] that belong to the state of South Dakota through an illegal contract with a company he owned.[2]
  2. Joop Bollen dragged South Dakota into a six year lawsuit in which South Dakota’s own attorneys said he was deceptive and repeatedly “violated South Dakota law.”[3]
  3. Mike Rounds didn’t fire Joop Bollen after he learned about Bollen’s self dealing through the EB5 lawsuit. Rounds rewarded him with a no-bid contract that encouraged deeper corruption.[4]
  4. Now, the FBI is investigating the EB5 program in South Dakota.[5] Such is the “black mark” that Mike Rounds’ tolerance of corruption has brought our State.[6]

Accountability: Mike Rounds has repeatedly made assertions about the EB5 scandal, only to have documents contradict his previous statements.

  1. Mike Rounds told a legislative panel that his office was never served legal papers involving an EB5 lawsuit. The Rapid City Journal proved Rounds was served.[7] Lying to an investigative panel is a class 6 felony whose penalty is disqualification from office.[8]
  2. Mike Rounds told Pierre correspondent Bob Mercer that he did not personally recruit immigrant investors, but Mercer discovered a letter he wrote to recruit immigrant investors.[9]
  3. Mike Rounds tried laying all the blame for the EB5 scandal on the Board of Regents,[10] but court documents, court depositions and contracts show that the Governors Office of Economic Development ran the EB5 program.[11]
  4. Even now, Rounds continues to assert to South Dakotans that EB5 created 5,000 jobs, but a Pierre reporter could only identify a few hundred jobs.[12]

Transparency: Mike Rounds and his appointees have refused to disclose key documents about the EB5 scandal.

  1. Rounds appointee Attorney General Marty Jackley refused to release the autopsy report of Rounds cabinet secretary Richard Benda, whose sudden and tragic death first elevated the EB5 scandal into the public eye.
  2. Mike Rounds appointees at the Board of Regents have repeatedly refused to release documents from the EB5 Darley litigation even after South Dakota taxpayers covered nearly $500,000 in litigation fees that were previously undisclosed.[13]
  3. The Board of Regents refused the free the EB5 files even after the Darley litigation came to a close because they “don’t wish to release it right now.”[14]

What would a Mike Rounds endorsement mean? An endorsement of Mike Rounds to represent South Dakota in the United States Senate endorses the view that theft of South Dakota taxpayer-owned assets is acceptable to South Dakotans.

An endorsement of Mike Rounds to represent South Dakota in the United States Senate endorses the view that honesty from South Dakota public officials is no longer a requirement for holding public office.

And lastly, an endorsement of Mike Rounds to represent South Dakota in the United States Senate, at a time when the FBI may likely take action, places your own paper’s reputation at risk as criminal indictments are announced.

________________________________

[1] Mitchell Daily Republic, “First EB-5 Payday Topped $13 million for Bollen firm.” 10.24.14

[2] Argus Leader, “State EB-5 director signed deal with his own company.” 9.8.14

[3] Government Operations & Audit Committee, “The Lucas Report.” 9.24.14

[4] KELOLAND, “SD got involved with EB-5 via no-bid contract.” 8.18.14

[5] KELOLAND, “FBI confirms ‘active’ investigation of SD EB-5 program.” 10.22.14

[6] Aberdeen American News, “GOP fails on EB-5 scandal.” 8.6.14

[7] Rapid City Journal, “Document contradicts Rounds’ testimony.” 10.2.14

[8] Rapid City Journal, “Democrats: Rounds broke law, can’t hold office.” 10.8.14

[9] Aberdeen American News, “Rounds signed 2005 recruitment letter.” 10.11.14

[10] Argus Leader, “Rounds: Regents oversaw EB-5.” 9.24.14

[11] Darley litigation, John Meyer Deposition. 4.24.14

[12] Mitchell Daily Republic, “Analysis finds EB-5 jobs data used by Rounds is highly elusive. “10.24.14.”

[13] Argus Leader, “EB-5 attorneys cost state $239k this year.” 9.25.14

[14] Rapid City Journal, “Regents won’t release Bollen deposition.” 10.14.14

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FBI confirms ‘active’ investigation into Mike Rounds EB5 citizenship-for-sale scheme

For Immediate Release: Wednesday, October 22, 2014

BREAKING
FBI confirms ‘active’ investigation into
Mike Rounds EB5 citizenship-for-sale scheme

The Mike Rounds citizenship-for-sale scheme is under an ‘active’ investigation by the FBI according to a breaking report from KELO. South Dakota Democratic Party executive director Zach Crago released the following statement:

“Mike Rounds is clearly in trouble. His citizenship-for-sale scheme resulted in high profile bankruptcies, lawsuits, audits, legislative hearings, and now a confirmed ‘active’ investigation by the FBI.

The fact is Mike Rounds ran the EB5 program out of the Governor’s Office, and he’s been covering up his role in the EB5 scandal ever since.

South Dakotans just cant trust Mike Rounds to tell the truth, and the FBI knows it.”

FBI Says EB-5 Investigation Remains ‘Active’
Keloland.com
October 22, 2014, 12:44 PM by Ben Dunsmoor

The FBI says an investigation into the South Dakota Regional Center and the federal EB-5 program is still ‘active.’

South Dakota Governor Dennis Daugaard announced a year ago that the state economic development office was under investigation by state and federal officials. A spokesman with U.S. Customs and Immigration Services later confirmed last November that the FBI investigation involved the EB-5 program.

South Dakota U.S. Attorney Brendan Johnson has refused to confirm or deny an investigation into the federal program as the circumstances surrounding EB-5 have become a heavily-debated issue in the race for South Dakota’s open U.S. Senate seat.

However, on Wednesday Kyle Loven, the media coordinator for the FBI’s regional office in Minneapolis, confirmed to KELOLAND News that the probe into the EB-5 program in South Dakota, ‘remains an active investigation.’ Loven wouldn’t confirm any other details citing that the case is ongoing.

South Dakota Attorney General Marty Jackley said in July that the state has wrapped up its investigation and was ready to indict former South Dakota Secretary of Tourism and State Development Richard Benda shortly before Benda committed suicide last October.

EB5 Citizenship-for-sale  Kings Joop Bollen & Mike Rounds

EB5 Citizenship-for-sale Kings Joop Bollen & Mike Rounds

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FACT SHEET from EB5 depositions: Mike Rounds owns EB5 scandal

For Immediate Release: Tuesday, October 21, 2014

FACT SHEET from EB5 depositions:

Mike Rounds owns EB5 scandal

Sioux Falls, SD (October 21) – Mike Rounds owns the EB5 scandal. That much is clear after an exhaustive analysis of EB5 depositions filed under penalty of perjury, says Zach Crago, Executive Director of the South Dakota Democratic Party.

“Mike Rounds has tried to lay all the blame for the EB5 scandal on the Board of Regents. But EB5 depositions make clear that Mike Rounds’ office was fully in charge of the EB5 program, and there is no amount of finger pointing and amending of testimony that can change this indisputable fact.”

The South Dakota Democratic Party produced the following fact sheet from depositions leaked from EB5 litigation (also attached):

Governors Office of Economic Development ran EB5 – not Board of Regents

When it comes to the EB5 scandal, Mike Rounds has made it clear that the Board of Regents bears all the blame. In his written testimony to the Government Operations & Audit Committee and public statements, Rounds said:

The truth is a different matter. Mike Rounds’ Governor’s Office of Economic Development was clearly in charge of the EB5 program, according to depositions from state officials under penalty of perjury. Here is a summary of GOED’s role in the EB5 program:

  1. GOED was the first public body interested in EB5 (Bollen, 10)
  2. GOED granted Joop Bollen’s South Dakota International Business Institute authority to run the EB5 program. (Meyer, 23; Meyer, 39; Meyer, 50; Bollen, 126-127; Bollen, 131; Bollen 216; Bollen, 230)
  3. GOED funded Joop Bollen’s EB5 activities with “negligible” resources and “limited” cooperation with NSU. (Meyer, 25; Bollen, 63; Bollen 130; Bollen, 340)
  4. GOED and Department of Agriculture selected investment projects for the EB5 program. (Meyer, 60; Bollen, 11; Bollen, 13; Bollen, 36; Bollen, 135)
  5. GOED assigned Bollen’s duties. (Meyer, 26)
  6. Bollen reported primarily to GOED – not NSU. (Meyer, 28; Meyer, 34; Bollen, 129; Bollen 152)
  7. Bollen submitted his budgets to GOED – not NSU. (Meyer, 34-35)
  8. GOED participated in meetings concerning problems in the EB5 program. (Meyer, 56; Bollen 64)
  9. GOED signed immigrant investor recruitment contracts with Bollen. (Meyer, 57)
  10. GOED used its letterhead for EB5 authorization documents (Meyer, 66; Bollen, 78)

In short, the Board of Regents was not in charge of the EB5 program. Mike Rounds’ office granted Bollen authority to run the EB5 program, funded his EB5 activities, selected projects for EB5 funding, assigned Bollen’s responsibilities, and received regular reports among other things.

The fact is Mike Rounds owns the EB5 scandal – and there’s no amount of amending testimony that can make up for the parade of documents that contradict Rounds’ previous statements.

The EB5 depositions can be found at the links below:

DEPOSITION: John Meyer, Northern State University attorney
DEPOSITION: James Shekleton, Board of Regents General Counsel
DEPOSITION: Joop Bollen, EB5 program director

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SD taxpayers on hook for “millions of dollars of potential liability” from EB5 scandal

For Immediate Release: Wednesday, September 10th, 2014
Contacts: Zach Crago

NEW DOCUMENTS REVEAL
South Dakota taxpayers on hook for “millions of dollars of potential liability” from EB5 scandal

Governor Mike Rounds, Governor Dennis Daugaard, SD Board of Regents, former Attorney General Judge Larry Long and Attorney General Marty Jackley knew and didn’t disclose to legislators, press or public

Sioux Falls (September 10, 2014) — South Dakota taxpayers are facing “millions of dollars of potential liability” from an ongoing lawsuit in a California court about the state’s administration of the EB5 citizenship-for-sale program, according to previously unreleased court documents filed by the state of South Dakota.

EB5 Citizenship-for-sale  Kings Joop Bollen & Mike Rounds

EB5 Citizenship-for-sale Kings Joop Bollen & Mike Rounds

These documents further reveal that top state leaders including Governor Mike Rounds, Attorneys General Larry Long and Marty Jackley, former Board of Regents Executive Director Tad Perry, and Governor Dennis Daugaard knew about this lawsuit, concealed the potential liability from state legislators, and have since withheld the truth from the press and the people of South Dakota.

Prepared statements:

Thank you all for coming to this press conference and dialing in on the conference call. My name is Zach Crago, and I’m the executive director of the South Dakota Democratic Party.

I’ve called for this press conference today to reveal explosive new documents filed by the state of South Dakota from lawsuits in a California state and federal court about the Rounds-Daugaard administration’s management of the EB5 citizenship-for-sale program.
These court documents filed on behalf of the state of South Dakota reveal the following:

1) South Dakota taxpayers are on the hook for “millions of dollars of potential liability” from the “general fund of the state of South Dakota” as a result of Rounds employee Joop Bollen’s $140 million fraudulent EB5 scheme.

[Exhibit 6: Memorandum of Points; Exhibit 12: Perry declaration]

2) Rounds employee Joop Bollen “willfully kept the existence of this action” from the state, filed legal documents on behalf of the State without permission, and later hired his EB5 co-conspirators at Hanul Law Corporation to represent the state in federal court “in violation of South Dakota law.”

[Exhibit 6: Memorandum of points; Exhibit 2b: Opposition brief]

3) South Dakota leaders including Governor Mike Rounds, Attorneys General Larry Long and Marty Jackley, Governor Dennis Daugaard, South Dakota Board of Regents executive directors Tad Perry and Jack Warner and former President Harvey Jewett, and Northern State University President Dr. James Smith knew the substance of these federal and state lawsuits, concealed the potential liability from state legislators, and have ever since withheld the truth from the press and the people of South Dakota.

[Exhibit 6: Memorandum of points; Exhibit 7 AG Larry Long declaration; Exhibit 9 NSU attorney John Meyer declaration; Exhibit 10 SDBOR General Counsel James Shekleton declaration; Exhibit 12 SDBOR executive director Tad Perry declaration; Exhibit 17 AG Marty Jackley’s declaration, SDBOR executive director Jack Warner]

These conclusions are clear after over six years of legal wrangling between the state of South Dakota and Darley International LLC, the EB5 immigrant investor recruitment company that the state of South Dakota employed in a confidential exclusive contract to recruit Chinese investors in October of 2007. And that’s where the timeline of this story starts.

Darley-Hanul-SDIBI arbitration timeline

What do we know from the legal action?

1) South Dakota taxpayers are on the hook for “millions of dollars of potential liability” from the “general fund of the state of South Dakota” as a result of Rounds employee Joop Bollen’s $140 million fraudulent EB5 scheme.

In South Dakota’s Memorandum of Points dated April 13, 2009, James Lynch, the $300 an hour California attorney hired by South Dakota, states:

“By this motion, the South Dakota Board of Regents seeks to be relieved from the effects of this Court’s October 7, 2008, order compelling the South Dakota International Business Institute to participate in an arbitration in which it faces millions of dollars of potential liability.” [Exhibit 6]

By April of 2009, South Dakota already knows it may be on the hook for potential liability. But where was this millions of dollars supposed to come from? Board of Regents Executive Director Tad Perry said in his declaration signed under penalty of perjury.

“Were a court to permit a suit against the SDIBI in its own name and a money judgment were to be entered against the SDIBI, such judgment would be paid out of the funds of the state of South Dakota.” [Exhibit 12]

In fact, attorney James Lynch continued,

“Any money judgment or arbitration award against the SDIBI for this or any other matter, would be paid out of the general fund of the State of South Dakota.” [Exhibit 6]

That’s South Dakota taxpayer dollars – money that would go to education, healthcare, and economic development.

2) Rounds employee Joop Bollen “willfully kept the existence of this action” from the state, filed documents as if he were an attorney on behalf of the state without proper authority, and later hired his EB5 co-conspirator at Hanul Law Corporation to represent the state in federal court “in violation of South Dakota law.”

Again, in South Dakota’s Memorandum of Points dated April 13, 2009, attorney James Lynch states that Joop Bollen and Austin Su Ki Kim of the Hanul Law Corporation,

“… willfully kept the existence of this action from the persons with such legal authority until the end of January 2009.” [Exhibit 6]

Former Attorney General Larry Long was one person with such authority. In fact, in his declaration filed in federal court under penalty of perjury, he states:

“Mr. Bollen has never been authorized by me or an authorized representative of my office to accept service of process, defend, or to appear in litigation for, the State of South Dakota… Mr. Kim has never been authorized by me or an authorized representative of my office to accept service of process, defend, or to appear in litigation for, the State of South Dakota.” [Exhibit 7. Also, see Exhibit 2b]

In fact, James Lynch went so far as to suggest that Joop Bollen had broken the law when he retained his EB5 co-conspirators at Hanul Law Corporation to arbitrate on behalf of the state:

“Mr. Bollen was clearly mistaken in his belief that he could retain legal counsel in violation of South Dakota law.” [Exhibit 6]

In other words, Rounds employee Joop Bollen messed up big time. He dragged South Dakota into a legal morass, concealed the lawsuits from the state, and only informed the state when he had exhausted every other option. But once word got out, news travelled fast around Pierre.

3) South Dakota leaders including Governor Mike Rounds, Attorneys General Larry Long and Marty Jackley, Governor Dennis Daugaard, South Dakota Board of Regents executive directors Tad Perry and Jack Warner and former President Harvey Jewett, and Northern State University President Dr. James Smith knew the substance of these federal and state lawsuits, concealed the potential liability from state legislators, and have ever since withheld the truth from the press and the people of South Dakota.

In declaration after declaration for federal and state courts under penalty of perjury, state leaders said they knew the facts about this EB5 scandal.

NSU attorney John Meyer knew when Joop Bollen finally disclosed legal action in January of 2009. [Exhibit 9].

SDBOR general counsel James Shekleton knew when NSU attorney John Meyer disclosed this information in January of 2009 after which Shekleton immediately started looking for California counsel. [Exhibit 10]

SDBOR executive director Tad Perry knew when James Shekleton informed him in late January, and he declared that Joop Bollen and Hanul Law Corporation did not have the right to represent the State of South Dakota in court. [Exhibit 12]

Attorney General Larry Long knew, and in fact he authorized the hiring of California attorney James Lynch at $300 an hour to represent the State of South Dakota in California court. [Exhibit 7]

As the issue moved from federal to state court over four years, SDBOR executive director Jack Warner knew and Attorney General Marty Jackley knew nearly all the details about Joop Bollen’s fraudulent scheme. [Exhibit 17]

Governor Dennis Daugaard knew because Daugaard asked the Attorney General to investigate the Eb5 scheme, and Attorney General Marty Jackley must have provided the Governor all the specific details.

And of course, Governor Mike Rounds knew as the state invoked the Seal of South Dakota in federal court to protect Joop Bollen and more importantly the valuable stream of EB5 money that was funding his top political priorities like South Dakota Certified Beef and the Northern Beef Packing Plant.

Each step along the way, the Board of Regents, Governor Mike Rounds, and Governor Dennis Daugaard had a duty to disclose potential liability to state legislators just like state leaders do when accidents involving Department of Transportation vehicles lead to costly lawsuits or when issues arising from the corrections department lead to litigation. Legislators are routinely forewarned about potential liability involving the state and taxpayer money.

Each step along the way, Governor Mike Rounds and other state leaders also concealed the potential liability from the press – a concealment which continues today. In fact, when Argus Leader reporter David Montgomery called some of these state leaders after Rep. Kathy Tyler’s press conference on Monday, all of them pleaded ignorance when in fact Joop Bollen’s creation of SDRC Inc to push out Darley from EB5 recruitment was a prime subject of the Darley litigation!

Here’s a question I would ask Governor Mike Rounds and Governor Dennis Daugaard if I were in your shoes: Did you know about these lawsuits?

Folks, it breaks my heart to say that our state leaders have not told the whole truth and nothing but the truth to the people of South Dakota.

At the Dakotafest Debate in Mitchell, Mike Rounds pointed the finger at his late cabinet secretary Richard Benda. He said, “If I would have known what he did when I was Governor, I would have fired him.” What about his EB5 confidante Joop Bollen?

Fact of the matter is Mike Rounds and many others knew Joop Bollen had perpetrated a huge fraud managing the EB5 program. Mike Rounds knew Bollen’s fraud had put South Dakota into a legal morass. And Mike Rounds knew South Dakota taxpayers are on the hook to pay millions of dollars in potential damages.

Yet this much is clear: Mike Rounds didn’t fire Joop Bollen. He didn’t even discipline him even though South Dakota’s hired attorneys claimed he broke the law.

Folks there’s no way any South Dakotan still has a job after messing up this badly. But Mike Rounds didn’t reprimand Bollen at all. Instead, Mike Rounds protected Joop Bollen in the court of law and rewarded his confidante with an updated sweetheart EB5 no-bid contract in December of 2009.

At this time I’d welcome questions from members of the press.

 

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