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Rounds Repeats Tired EB-5 Campaign Fibs, Keeps Hands Off USCIS Punishment of Corruption He Started

Senator Mike Rounds talked to reporters yesterday about the corruption of the EB-5 program that began under his watch as Governor and that has destroyed South Dakota’s credibility in the eyes of the United States Citizenship and Immigration Service. Senator Rounds repeated two key stretches of the imagination that he used to deflect EB-5 criticism during his 2014 Senate campaign:

Rounds says he hasn’t seen the notice, but he believes the concerns in the report occurred when the program was run by a private firm or after he left the governor’s office in 2011.

Rounds, a Republican, says the program created thousands of jobs in South Dakota [“Rounds: Feds Right in Exercising Oversight of EB-5 in SD,” AP via KSFY, 2015.10.22].

Rounds dissembles when he tries to foist blame for any EB-5 mischief onto private firm SDRC Inc. and/or his successor Dennis Daugaard. The Rounds Administration made Joop Bollen its EB-5 czar in 2003. The Rounds Administration approved Bollen’s privatization of EB-5 into Bollen’s own corporation, SDRC Inc., in 2009. The September 28, 2015, USCIS termination notice to South Dakota lists a number of questionable financial transactions that took place prior to that privatization, while Bollen was still running EB-5 as a state employee and while Rounds was still Governor.

Really, Senator Rounds, instead of telling us what you believe the USCIS termination notice says, you should read the notice itself.

Rounds also exaggerates the job creation record of his EB-5 program. USCIS is terminating South Dakota’s access to EB-5 in part specifically because the state allowed EB-5 dollars to be used for activities unrelated to job creation. As for the dollars that may have been used properly, “thousands of jobs” is recycled from Rounds campaign propaganda that has never received independent confirmation and has been deemed lacking in evidence by Bob Mercer and by my own analysis of South Dakota job numbers.

Even Rounds doesn’t think his propaganda is strong enough to fight the USCIS termination notice. He says he won’t lobby to block the termination.

Think about that for a moment. The Obama Administration has targeted South Dakota for a unique punishment, one not dealt out to any other entire state. The Obama Administration wants to cut South Dakota off from a lucrative economic development program designed to help rural states. One would think that a Senator from South Dakota would be burning up the phone lines to USCIS demanding that the feds not treat our state so unfairly. Instead, we’re saddled with a Senator who kingpinned the very corruption that landed us in this hot water, and all he can do is shrug and say, “Don’t blame me!”

Rounds also tells AP that he hasn’t decided whether he’ll vote to extend the EB-5 visa investment program. Congress passed a ten-week extension that runs out December 11. The program needs reform, but Rounds, who claims EB-5 was great for South Dakota, can’t work up the courage to back his words with a clear position on legislation he could help pass.

Senator Rounds’s responses to the EB-5 scandal show a feckless Senator who can only spin words for self-defense, not the greater good of our fair state. Such is the weakened state of South Dakota’s voice in the U.S. Senate.

28 Comments

  1. Craig & Ronette Guymon 2015-10-23

    A gutless coward once again replies with corrupt excuses, instead of honorably taking ownership of his failed leadership decisions.

    Senators, “Call the Roll! Boot toe needed!”

  2. Jim 2015-10-23

    Golly gee, to hear mike tell it, EB-5 was real swell for South Dakota. Yet, he won’t try and help us keep it. Poor guy is probably too embarrassed to make that request. The quicker EB-5 goes away, the better his re-election prospects.

  3. Disgusted Dakotan 2015-10-23

    Quick! Mike Boswell! Tell us how nothing amiss occurred in the hundreds of millions of dollars that disappeared in the EB5 corruption!

  4. larry kurtz 2015-10-23

    The Feds will send their findings to a grand jury: right?

  5. mike from iowa 2015-10-23

    Maybe you are dealing with cardboard Mike,the strong,silent one that shows up for photo ops.

  6. Jana 2015-10-23

    Knowing how much the SDGOP has been behind spending crazy money to find justice (or a politically motivated witch hunt so one of their candidates has a better than snowball’s chance in hell) in a possible wrong doing, I’m guessing Troy, Charlie, Lee and even PP along with the entire GOP legislature will be initiating and getting behind a Benghazi-like investigation complete with public hearings.

    Lee, you can play the part of Trey Gowdy!

    Benghazi = 4 lives. GOP Crony Capitalism = 6 lives including 3 innocent children.

  7. leslie 2015-10-23

    larry-did kristie come after you?

  8. Jana 2015-10-23

    When Rounds made his comments about the USCIS actions, I’m guessing he and his staff had a certain hollow feeling in their gut. I’m also guessing his legal team was out shopping for new Mercedes.

    Good luck Mike. When did the EB-5 fraud begin?

    Just remember Mike, Daugaard threw you under the bus with the deficit that had him gut education for our South Dakota children. Yep…he put that all on you.

    Go for it smiling Mike! I’m sure you want the truth out there!

  9. leslie 2015-10-23

    forgot to add to my parallel post:

    Rounds’ Secretary of Tourism (yes the same cabinet office that took a shot at the Indian people of SD this summer saying changing Harney Peak would confuse tourists-ignoring the VAST world tourism interest in South Dakota’s Indian culture and history-gud job brownie!!);

    Benda…(or others) steered EB5 to Joop who then took all the records and won’t return them. During Round’s closing administration benda and joop then took an auditor’s check for $1 Million to give to Rory King’s client NBP. The complaint filed last week says “we can’t respond to USCIS’s 30 day notice to terminate EB5 without those records”!!!!!!! (or words to this effect). What brilliant state leadership by these two republican governors. :(

  10. leslie 2015-10-23

    one last thing: daugaard’s IRONIC freudian slip-

    he said: “and we’re very interested in getting to the bottom of…any [EB5] wrong doing THAT CAN BE IDENTIFIED”.

    HAHAHA. we dems may read that to mean wrong doing that can be proven after all the state’s GOP led cover-ups!

    todayskccr.com audio clip

  11. leslie 2015-10-23

    the next audio clip refers to “at-risk” investment which is quite different than kccr reporter’s statement that investments had to be directed at risky prospects.

    in the third audio clip daugaard just dismisses this kind of investment capital as unneeded in SD. tell that to the few success stories he and rounds have been bragging about for the last several years!

    todayskccr.com audio clips of gov. daugaard. http://www.todayskccr.com/blog/governor-reacts-to-eb5-program-end/

  12. leslie 2015-10-23

    USCIS p.6, third bullet says “Benda was Secretary of Office of Economic Development.” correct? As cabinet level head of Dept. of Tourism, as Bachand’s complaint reads, when he left to work for Joop’s SDRC, Inc., did Daugaard then change the name of that dept. to GOED?

  13. leslie 2015-10-23

    USCIS p. 8, last para: Joop (or somebody, cherry brick?) mis-told USCIS that Deadwood Mountain Grand apparently received $27,000,000 more than actual receipt (into somebody else’s pocket??); $103,000,000 more than Basin electric-deer creek station received (into somebody else’s pocket???); $10,5000,000 more than NBP received (into some body else’s pocket????).

    the obvious word for the day-“go big or go home” :)

  14. leslie 2015-10-23

    keeping in mind Daugaard and rounds were elected and served as Lt. Gov. and Gov., respectively from 2003-2011, it is interesting that NBP ect. draw requests of 2011 and 2012 to Joop or Benda were used but not documented as required, for $2,160,000 of expenses. USCIS, p.11

    $1,022,000 of legal, agent’s, korean construction, and meal expenses were also NBP’s according to the “dynamic duo”. This sound right Rory?

    USCIS language in the notice like: “EB-5 funds…used…purposes not aligned….mismanagement and failure to oversee…such funds….failure…to ensure…EB-5 funds…by engaging in or failing to stop diversion of investor funds” (p.10) sounds an awfully lot like statutory fraud that USCIS may not be quite ready to allege as criminal behavior to the Justice Department.

    (caveat: not a math head, and lazy, my numbers could be off here and in 22:02 above)

  15. Porter Lansing 2015-10-23

    Questionable financial transactions that happened before the “self-privatization” must be investigated by the Feds and turned over to a Federal Grand Jury. If the missing paperwork and money in question isn’t recovered, USA must move immediately to recover treble damages from the state treasury (So, that’s what they’ve been hoarding the surplus for?) just as the IRS does when assessing debt for lost paperwork and criminal activity. Marty Jackley must be impeached and indicted for complacency to felony fraud. But, most of all the SoDak Republican party must be publicly ridiculed for this embarrassment to innocent citizens.

  16. leslie 2015-10-23

    Again keeping in mind the governors’ time frame, in 2007 and 2008 NBP may have invested EB-5 funds in Russian, CIS and Baltic railroads. I think joop was running SDRC for the state then before privatizing. USCIS, p.12

    Joop “facilitated” BVI/Cayman Islands (Epoch Star/Pine) NBP financing in about 2010, spending more than $7 Million for 3 mos. bridge financing before NBP “bought the bank” for more than another $5 Million, Joop/SDRC, Inc. diverting investor funds. PP. 12,13.

  17. caheidelberger Post author | 2015-10-24

    Leslie, that’s a fascinating KCCR story. Governor Daugaard says he is not going to contest the USCIS’s termination of our EB-5 program. Why the heck not?

    Ah, because, perhaps challenging the reasons USCIS gives for terminating our Regional Center would either (a) require digging up all sorts of documents, check stubs, and e-mails that Mike Rounds can’t afford to have revealed or (b) refuting charges that cannot be refuted.

    Essentially, the Governor is saying, “Yup, the feds are right. We got caught with our hands in the cookie jar. We’ve had our cookies, and we’re not going to risk asking for the feds to hand us the cookie jar again.”

  18. mike from iowa 2015-10-24

    Porter,it is impossible to ridicule wingnuts. They have no conscience,therefore they have no shame.

  19. leslie 2015-10-24

    very interesting. for me it gets back to asking brendan about EB5 in the spring, waiting for rc press club summer-baked schpeel from him about not prosecuting but privticing his career, the FBI’S role, and now this-USCIC’s taking the pre-prosecutorial role. what next? rounds and daugaard have GOT to be losing weight!

  20. mike from iowa 2015-10-24

    Under the EB-5 program, foreign investors could gain a US visa with a five hundred thousand dollar investment. Daugaard says those investments had to be directed to risky prospects…

    There is nothing in the EB-5 manual that says funds have to be used for risky projects. $500000 visas are for use in rural areas and areas of high unemployment. If chosen carefully,there should be little risk of project failure. The money for the Visas is to be considered at risk-if the project fails or jobs are not created then the person seeking the Visa should have no expectation of getting their money back.

  21. leslie 2015-10-24

    yup. daugaard has been too busy to READ the USCIS notice. his (good) lawyers will….

  22. jerry 2015-10-24

    mfi, you do know that here in South Dakota, Daugaard is promoting dairy operations and the like, as safe havens for investors. He promotes them, like his predecessor, as being good for county governments and a magnet for employment. Nowhere does he promote the fact that they are “risky”. Why does he single out the Chinese investor or the South Korean investor or the Russian investor as having huge “risks” in the investments he peddles to the ignorant here in South Dakota as safe bets with only riches to be gained. Is it possible that Rounds and Daugaard may have been up to no good peddling these large dairy operations and the like, as safe haven for counties? Naw, that would be dishonest. No honest person would ever consider that.

  23. mike from iowa 2015-10-24

    The goon(s) that ran EB-5 in South Dakota chose risky ventures it would seem to indicate they were more attuned to absconding with the investment dollars and not worried about any investors. Excessive fees seem to be in fashion for the shady EB-5 operators.

  24. Spike 2015-10-24

    I finally broke down and read the 18 page notice…all I can say is…..

    WOW! That’s some PISS poor management and accounting.

  25. caheidelberger Post author | 2015-10-24

    Spike, when $5 million falls through the cracks in the ledger, yeah, that’s poor accounting.

  26. leslie 2015-10-25

    and creative expense accounting

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