I’ve meant since Sunday to write up Jeff Sveen’s response to the state’s lawsuit against the corporate facade of his client and EB-5 compadre Joop Bollen, but stuff keeps happening! Let’s go to work:
Recall that the State of South Dakota is suing SDRC Inc., the company Joop Bollen and Jeff Sveen created to allow Bollen to privatize his own state job, to force Bollen to fulfill his contract, pay the legal bills his actions incurred for the state, and turn over documents that would help the state respond to the accusations of error and corruption that support USCIS’s intent to terminate South Dakota’s access to EB-5 visa investment. On October 16, 2015, the same day it filed the lawsuit, the Governor’s Office of Economic Development sent a letter to Bollen’s lawyer here in Aberdeen, Jeff Sveen, restating those demands.
In an October 22, 2015, letter to GOED attorney Paul Bachand, Mr. Sveen starts by saying that his client surrendered all the documents the state wants on October 3, 2013, shortly after Governor Daugaard canceled SDRC Inc.’s contract to run EB-5:
As you are aware, the Consulting Agreement between SDRC, Inc. and GOED… was terminated with no cause in September 2013. Shortly thereafter, on October 3rd, five boxes of documents and materials were provided to GOED. These include the specific documents and information that you requested in your letter of October 16th. Either GOED has not reviewed the information that was provided to them by SDRC, Inc. or simply does not understand the information and documentaiton that it has [Jeff Sveen, letter to Paul Bachand, 2015.10.22, in South Dakota response to USCIS, Exhibit G, p. 59].
Sveen includes pictures of those boxes, which we may presume are the documents he improperly removed from the Northern State University campus on December 21, 2009.
Sveen asserts that “SDRC, Inc. has never refused any request by the State of South Dakota to provide Regional Center records, which the State is entitled to receive.” That sentence smells of weasel words for legal argument in court. The Regional Center is GOED; SDRC Inc. is a separate corporate entity. Technically, Sveen may be able to say that SDRC Inc. has provided GOED with all the documents to which it is entitled as the EB-5 Regional Center yet still refuse to provide the wide range of business documents that GOED is demanding from SDRC Inc. Indeed, in an attached itemized response to the state’s specific information requests, Sveen says that SDRC Inc. can’t provide individual contact information for investors, declares records of the Limited Partnerships formed as conduits for EB-5 money “not part of the management of the Regional Center,” and qualifies the documents delivered to GOED as those “used to file I-924A reports,” suggesting GOED has no claim to documents beyond the demands of the annual reports to USCIS.
Sveen portrays GOED as the bad guy, accusing the state of refusing to help SDRC Inc. or the EB-5 visa investors. Sveen says the state’s failure to help SDRC Inc. and the EB-5 investors “will, in all probability, result in future litigation.” (It’s so cute when lawyers fight.) Sveen invokes Maurice Berez’s letter on the state’s need to fight for its EB-5 status in order to save the green cards of 274 EB-5 investors and their families. Sveen reminds the state the Berez was the former USCIS EB-5 chief; he does not remind GOED that Berez then made money consulting for SDRC Inc. Sveen says that losing Regional Center status will be “a disaster for hundreds of people”
Sveen rejects the state’s argument that USCIS’s intent to terminate South Dakota’s Regional Center status is based entirely on actions taken by Bollen and SDRC Inc. Sveen correctly notes that the state has made errors and let EB-5 sit dormant since canceling SDRC Inc.’s contract in September 2013:
The Notice to Terminate does not indicate actions solely related to SDRC, Inc. or Mr. Bollen. The Notice to Terminate is for failure to submit required information and failure to promote economic growth. Since the State terminated management of the Regional Center by SDRC, Inc. in September 2013, the State has been required to file reports with USCIS, which evidently, USCIS feels were either not filed at all or filed imporperly. Furthermore, the State’s Regional Center has failed to promote any EB-5 Projects in South Dakota, several of which had been approved at the time of termination of SDRC, Inc.’s contract. It is my understanding that no further action was undertaken by the State toward any of those projects [Sveen, 2015.10.22; pp. 59–60].
Paul Bachand responds for GOED the very next day, October 23, with this bit of lawyerly snootiness:
While my client believes its efforts are best directed toward responding to the Notice of Intent to Terminate (“NOIT”), we fee we must correct at least some of the incorrect statements in your letter [Paul Bachand to Jeff Sveen, 2015.10.23; p. 85].
Bachand says GOED is “not aware” of any attempts by SDRC Inc. to ask for GOED’s help with EB-5 investors “other than SDRC requesting that the State contact USCIS.” Bachand also tells Sveen that the State isn’t asking for documents to fill out I-924A’s; it’s asking for the documents it needs to rebut the Notice of Intent to Terminate South Dakota’s EB-5 status. Bachand says the state needs the very information—investor contact information, Limited Partnership records—that SDRC Inc. refuses to provide. Bachand mentions some other things the State kinda sorta needs Bollen to explain:
Among other concerns, it should be obvious to your client that the State cannot provide a factual response to, for example, the allegations on page 11 of the NOIT concerning the payment of certain expenses for purposes other than job creation without an explanation and supporting documentation provided by your client. Similarly, your client has not provided any explanation to rebut the allegations on page 17 of the NOIT concerning the I-829 petition for Ziming Xu. Those ommissions were clearly inconsistent with your statement that your client “is more than willing” to assist with the response to the NOIT [link added; Bachand, 2015.10.23; p. 86].
Why the state puts up with Jeff Sveen’s and Joop Bollen’s guff remains a mystery. As David Newquist writes, when the state really wants something from its political enemies, it just executes search warrants, even if it has no evidence of criminal activity. We’ll see how long the state keeps up its legal games with the recalcitrant Sveen and Bollen.
The state is playing nice with Bollen and Sveen because Jackley is afraid of what those two would do if his office pursued these two as aggressively as the information and missing monies deserved.
Too many hands in the cookie jar. So we get to be treated to the choreographed dance of half effort for public perception.
The rats will start consuming each other given enough time and pressure.
What we see here is the appearance of the state taking responsible action against SDRC, but who’s the real audience? The feds? The screwed-over investors? Or voters?
As David Newquist said this week, Marty Jackley has acted a lot more rashly for far less actionable situations. This whole thing smells like another sleazy ploy to buy more time.
hard to know where this will go but things have been cooking since right after the election, early 2015.
hats off to USCIS, the feds are the only players with integrity. choreography is a great word but does not capture:
1. who is accountable for the rounds clusterfork of mismannagement, banking commisssion and Regents two-step?
2. what the citizens will have to pay to rectify rounds clusterfork?
3. how can jackley and the legislature put party before integrity?
The Sveen letter is the Joopster reminding the state that Mike Rounds allowed him to privatize the profits and socialize the risks/expenses. The Joopster says we’ll keep the fees from the investors; the state now needs to pour taxpayer money into keeping those investors from losing their immigration status.
Joopster/Sveen is probably right about one thing though. If termination of the state’s right to participate in EB-5 results in investors losing their immigration status then there will be lawsuits that both the state and the Joopster will be drawn into. The message Sveen is telegraphing is that this isn’t just going to get ugly for the Joopster. It’ll get ugly and expensive for the state too.
This is all Republican inside baseball. All sides have an interest in covering their arses and putting on a good show for the public. Problem for them is that there may be no graceful or cheap way for anybody to get out of this tar baby now. Mike Rounds is going to get dragged in too.
Mike Rounds is the Joopster’s unmentioned bargaining chip. If the state gets nasty, the Joopster can always throw Mike Rounds and his brother under the bus. Neither Daugaard nor Jackley wants tire tracks on their mentor.
When Mike Rounds does get thrown under the bus, Governor Daugaard can take comfort knowing that it’s not his fault – it’s entirely Smiling Mike’s fault. Silver lining is that Gov. Daugaard will be able to appoint his son-in-law to the U.S. Senate.
Nice of the state to point out exactly the information that needs to be vanished so this whole mess can go away.
INS needs to raid Bollen’s office and Sveen’s offices and take all files and computers into protective custody and then have a bunch of knowledgeable investigators go over everything with a fine tooth comb.
It amazes how Jackley and friends are still employed.
Even worse is how and why voters put up with this caca del toro.
Mr. schach – We are in agreement. This is GOP inside baseball. The actions are meant to buy time. My guess is their end game is stalling out the feds until a Republican President is elected and he can call off the hounds.
The aggravating thing is when will South Dakota voters stop hitting the snooze button and act to clean house?
I would be very surprised if Mike Rounds completes a full senate term. He’ll probably last longer than Janklow though as the whole Pierre GOP apparatus run by his acolytes is arrayed in his defense.
The SD judicial system is well aware of Jackley and team actions. Hopefully it becomes federal for his sake as he tries to defend his most despicable position in the Mette case and the others that continue to stain him and our state.
Interesting, 90. Jackley could end up in a pressure decision. If he does his job, he loses the backing of the Pierre power circle that is critical if runs for Governor. If he doesn’t, he become accountable for doing nothing in the face of blatant lawlessness (is he corrupt or a coward?).
One problem for Marty Jackley, unfortunately for all of us, is that he announced a long time ago that he was done investigating EB-5 and that the dead guy did it. He thought he’d put it to rest with that (no pun intended) but now those pesky feds are forcing him to do something again that undermines his earlier decision to close his investigation and blame the dead guy. The moral of this story, if Marty ever gets it, is that it’s better to play it straight. Do the right thing the first time and let the chips fall where they may. Marty didn’t have anything to do with the Rounds/Joopster shenanigans, but by running cover for them he has risked both his integrity and his political future.
A plot worthy of Shakespeare. Res Ipsa Loquitur.
Customs doesn’t play these “reindeer games”. They pull the plug first and then start to stomp the cockroaches.
My Gut SaYs The Very Act Of Taking Records From NSU Was Illegal. Suggesting The State Failed Later Filings To USCIS W/o Access To Stolen Records Is Specious, of Course, as Cory Says. We Are About To Witness Cory, a Non-lawyer, take-down An AV peer-rated Lawyer and his chicken-sheit gravy-train client Joop, after AG jackley failed. After taking DOWN THE BOZ FOR HIM. (Jackley). Capitalizations Unintentional:)
Your gut? Leslie, that’s not your gut; that’s state law. And absconding with state property is the least of the charges on which I’d have arrested Bollen had I challenged Chad Haber for the Libertarian nomination and won the AG’s seat from Jackley last November.
Rounds, daugaard, jackley, warner, tidemann likely Jacked a state election. Joop & sveen are cannon fodder. AG W/o Experience Wud Be Like W running A War.
Politcal audits too. Simple house clean rewards hacks.
I am surprised we don’t hear more from Mr. Howie on all of this business, much of which happened under his watch. He, insaner than most, is still trying to lash out at Mr. Rounds for marginalizing his ideas in the legislatures.