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Governor considering lawsuit to recover EB-5 money

Governor considering lawsuit to recover EB-5 money

South Dakota Gov. Dennis Daugaard is considering filing a lawsuit to recover $550,000 meant to go to a beef plant involved in an investment-for-green-card program.

A private lawyer has been working for months to determine whether the state can reclaim the money, the Argus Leader (http://argusne.ws/1nq94Yj ) reported Sunday.

“If there’s a possibility that there are public funds that can be recovered, the state should make some effort to attempt to recover that,” said Tony Venhuizen, Daugaard’s spokesman.

The EB-5 investment visa program is under scrutiny in South Dakota because of allegations of financial misconduct at the Governor’s Office of Economic Development.

A state audit found that before Richard Benda left his job as head of economic development in 2010, he tacked on an extra $550,000 to a grant agreement to help the struggling Northern Beef Packers plant in Aberdeen.

A report from Attorney General Marty Jackley showed the same amount was improperly diverted to SDRC Inc., Benda’s new employer and South Dakota’s administrator of the EB-5 visa program, which allows people to seek U.S. residency if they invest at least $500,000 in approved projects.

To prevail in court, the state would have to prove that it was entitled to receive its money and then find a way to get those funds, the newspaper reported. But even if the state makes a case, it could still come out empty-handed if the money has been spent or is not accessible.

Venhuizen wouldn’t talk about the specifics of the potential lawsuit.

“At this point, given that it’s a matter of pending litigation, I don’t know that I want to say that much about it,” he said.

Benda committed suicide in October.

A draft criminal complaint, which Jackley has released, would have charged Benda with three alternate felony counts alleging he illegally obtained $550,000 in economic development money intended for the Northern Beef Packers plant and double-billed the state $5,559.80 for three flights to China and Las Vegas.


Source: http://www.washingtontimes.com/news/2014/aug/24/governor-considering-lawsuit-to-recover-eb-5-money/

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