South Dakota Governor Dennis Daugaard says he has become aware of alleged misconduct in the state economic development office. In a statement released Wednesday, Daugaard said the allegations happened prior to his administration.
Attorney General Marty Jackley confirms that he is currently reviewing the allegations of financial misconduct but that the investigation is ongoing and he cannot comment further.
Daugaard also confirms that federal authorities are conducting their own investigation. U.S. Attorney Brendan Johnson says as with any investigation, he can not confirm or deny that his office is looking into the matter.
“I take very seriously my responsibility as Governor to protect taxpayer dollars and to ensure the integrity of state economic development programs. I am confident in the integrity of those in my administration who work at GOED, and at my direction, GOED has initiated an independent review to verify that any alleged misconduct was an isolated incident,” Daugaard said in a statement Wednesday.
Daugaard said he became aware of the allegations earlier this year.
The news comes just one week after the former Secretary of Tourism and State Development, Richard Benda, was found dead of a gunshot wound near Lake Andes. Benda’s brother-in-law says the former Secretary was hunting when he died.
Jackley would not comment on if Benda’s death is connected to the allegations and said that his office is waiting on autopsy and forensic reports to determine how Benda died.
Former South Dakota Governor Mike Rounds said in a statement to KELOLAND News Wednesday night that he 'recently became aware of an investigation into some alleged misconduct,' and referred all questions to Jackley.
This should not be a surprise to those of us who understand how things in Pierre works. And we should not be surprised at Cory Heidelberger's reaction:
Governor Daugaard says he learned of the issue under investigation last spring. Attorney General Jackley confirms the state investigation continues. U.S. Attorney Brendan Johnson declines to confirm or deny the existence of the investigation that South Dakota's governor and attorney general say exists.
Daugaard and Jackley offer no dates or names, but they do say the misconduct took place prior to January 2011. Unless the alleged misconduct was really well hidden for over a decade, we are thus talking about possible misconduct under Governor Marion Michael Rounds.
You know, the guy running for U.S. Senate... and under whom Daugaard was Lieutenant.
And if we're talking misconduct under Rounds's GOED, there's a fair chance it could be connected to the cabinet sceretary who oversaw that GOED from 2006 to 2010, Richard L. Benda.
You know, the guy who was found shot dead in a grove of trees last week, whose cause of death remains under investigation, and whose funeral was yesterday, nine days after he died... and one day before Governor Daugaard chose to announce a problem he's known about for months.
And if the state and feds are investigating, we're not talking about someone walking home with a stapler. We're talking about someone in state government doing something wrong with money (probably a lot of money) connected to the federal government. What GOED program could that be?
How about the EB-5 visa program, the program where wealthy foreigners essentially buy their green cards by investing $500,000 in new American business ventures? The feds have looked into abuse of the EB-5 visa program in Texas. South Dakota, operating through the privately incorporated South Dakota Regional Center, has used EB-5 money to fund numerous projects: the Dakota Provisions turkey plant in Huron, the Deadwood Mountain Grand Casino, the Veblen megadairies, and Northern Beef Packers.
The last two were the biggest projects the SDRC funded during the Rounds Administration. And without the advocacy of Mike Rounds and the financial wizardry of Richard Benda, Northern Beef Packers in particular never would have happened. The Veblen megadairies and Northern Beef Packers both made millions of dollars of EB-5 money disappear in apparent mismanagement and bankruptcy.
If there was any place for anything to go wrong with big money, the EB-5 visa program and the bankrupt projects it funded seem like the first place to look.
Looks like things have gotten very interesting. And one would be a fool to believe that this is just an isolated incident. I have yet to see any reaction over at the War College. A few months ago I did say this to Troy Jones via a comment at the War College:
Troy, because of your past work in that area [at the South Dakota Department of Economic Development], and my strong position that is also well research, perhaps your reaction today is a little biased. I do apologize if my work becomes upsetting. Instead of saying that those working in the system are corrupt, I would hope one can say that those who are in favor of economic development through government are setting up a system where corruption can flourish without making judgments on individuals.
That was my response to Troy's disgust with my analysis of the SDGOP's economic development policies:
Maybe his views on the Governor’s economic development plan are correct. But, if all I hear is I am a “crony capitalist,” a “RINO” or desiring the “New World Order” (which is false), I will not hear his arguments. Too much poison.
It is now looking like I am not the one with the poison. In fact, I am the one whose political policy position should be regarded as the anti-dote to the poison of public/private patnerships and the government planned economic development agenda.
Yes, it is clear to me that this problem is systemic and this may also be how the SDGOP has created its political dominance in this state. Sadly the media and Democratic activists like Cory Heidelbergger will use this to attack conservatives and ignore all the warnings from those conservatives who are painted as extremists by the media. Democrats, and those in the SDGOP who want the fascist style of economic planning via public/private partnerships to continue. And we should not forget that the leadership of the South Dakota Democrats supported the SDGOP's economic development agenda during the last legislative session.
Sibby, I didn't attack any conservatives in my post tonight. You and I don't need to have a disagreement on this issue. Whatever's going on with these investigations, there's a high probability it has to do with a serious indictment of the crony capitalism that you and I both see as inimical to our state and country. This could be one of the strongest issues on which principled conservatives could attack and unseat folks like Rounds.
Could be. Could be. We still need to hear what the investigators are really looking at. Now would be a great time for you to get back to some of the original investigative blogging you did once upon time.
Posted by: Cory Allen Heidelberger | October 31, 2013 at 12:01 AM
Cory, yes we both agree that crony capitalism is wrong. Sad that you attack those who also agree with your "Tea Party" are radicals agenda. It is sad that you expect us "principled conservatives" to go after the crony capitalist as you attack us for being radicals, conspiracy nuts, and theocrats. That is not at all helpful. I also find it amusing that you come over here and tell me how to run my web site as you ban me from yours.
And did you miss the part on this post that pointed out the support the SDGOP economic development agenda from the South Dakota Democrats during the last legislative session? Correct me if I am wrong, but that support included you.
Posted by: Steve Sibson | October 31, 2013 at 08:36 AM