Grant expert Michael Wyland appears to agree with forensic economist Don Frankenfeld that the “very positive” audit of Mid-Central Educational Cooperative’s GEAR UP books should not assuage our fears of corruption in the coop’s shady management of this federal grant and several other programs:
The auditors qualified their report when they presented it to a public meeting of the MCEC board. “We did not have access to financial records or other information from any other business or individuals,” audit representative Hansen told the MCEC board members. Given the multiple conflicts of interest between individuals and organizations already reported in this scandal, that lack of investigatory breadth is significant. The audit was also limited—by MCEC as the audit client—to GEAR UP transactions. MCEC administers 22 programs on behalf of its member school districts as well as the state of South Dakota. If GEAR UP is affected, and the same business manager, executive director, and board oversaw all the programs, it’s essential to evaluate the handling of all the programs and all the money.
One odd thing about the presentation of the “good news” audit findings was that MCEC board members were not allowed to ask questions of the audit representatives or anyone else during the public meeting. Additionally, there was no opportunity for the media or the public to ask questions of MCEC leadership or the auditors hired by MCEC.
The limits placed on the auditors in their examination were matched by limitations placed on the public and MCEC leaders. Not exactly the “gold standard” one hopes for when hearing about an audit [Michael Wyland, “The Limitations of Nonprofit Audits: A Cautionary Case,” Nonprofit Quarterly, 2015.12.11].
Governor Dennis Daugaard didn’t talk about corruption in his budget address this week—he’ll hardly acknowledge the possibility that corruption could happen in his administration. But legislators should be thinking about the questions they will ask Education Secretary Melody Schopp when she comes to the appropriations committee to ask for funding for her department. They should also direct their Government Operations and Audit Committee to hold extra meetings all through 2016 to interrogate Mid-Central personnel specifically and state department heads and employees generally to find out why corruption has erupted in South Dakota and change our grade on fighting corruption from F to A.
The slyer the coverup the stinkier it gets.
its a lot like the state lawyers spinning that they won or came out even on darley’s lawsuit against joop earlier this year. it was a federal case that spun itself into arbitration and SD got stuck with $500,000 in legal fees to some professional firm, plus all the state’s own wasted hours in analysis, accounting and other in-house real costs you paid for, that we will never hear about, as i dimly recall.
now the state again hired a professional firm to get back the $500K. rounds’ EB5 fiasco has cost us millions, has tainted the state, especially the SDGOP, with corruption, cover-ups, and this kind of spin-bullsheit is communicated to the ears of the taxpayers so we won’t know enough to hold them accountable at the ballot box. it is out-right fraud.
so the headlines are “POSITIVE AUDIT-Yippee!!” for the Westerhuis scam.
i am so sorry the citizen’s of platte, the whole county, and the rest of us have to beg for scraps of information that are true, transparent and complete, to make sense of this second fraud-laced tragedy. and both EB5 and MCEC stories continue on their own legs, still alive and still hiding the truth, despite murders, arson and suicides.
and daugaard annouced that the tribes are so dysfunctional, they couldn’t be trusted to manage their own GEARUP program, or some such sheit!
The republican party must be held accountable. Obama has struggled to hold wallstreet bankers ect. accountable against republican backlash. and we dems must hold daugaard/rounds/Regents ect., accountable.
The audit did nothing to disprove many relevant and corrupt issues that remain. Jackleg and the gov will continue to try to cover-up the real issues through any superfluous means possible.
Rsterling, it’s important that we remind people of the emptiness of that “no malfeasance” headline. Mid-Central is using it right now to deflect scrutiny; as the election year gears up, legislators will start pointing to that empty headline to deflect charges that they have failed to check corruption in Pierre. If we want the accountability Leslie asks for, we need to make sure the public remembers what happened and sees through the smokescreens to the questions that have not been answered.
“But legislators should be thinking about the questions they will ask Education Secretary Melody Schopp when she comes to the appropriations committee to ask for funding for her department.”
When pigs fly!
God, Abortion and Guns … That is the perpetual focus of the South Dakota legislature. Don’t expect this group to break too far from their comfortable issues. That is how they got elected and that is how they will deflect attention away from the legitimate issues.
we could craft some nice written questions, let GOAC review them, and give her 30 days to huddle with state – paid lawyers and get back to us…or marty could subpeona their asses…oh, CJ, you just said that. sorry!
Dennis Daugaard, you don’t need to be the biggest sap to have ever put his left hand on the Bible and take the oath of office for Governor.
Dennis, you owe Mike Rounds nothing because he let you hang out to dry.
You owe Joop Bollen and Sveen nothing.
You owe Harvey Jewett nothing.
You owe the Chinese investors nothing other than to be honest.
Mike Rounds’ appointee Marty Jackley is not your friend and you owe him nothing.
You owe those who feasted on GEAR UP funds to line their pockets nothing.
All of this was set up by Mike Rounds. He left you sitting in your chair on the Second Floor holding a bag of hot, steaming dung on your lap.
That hot, steaming heap of dung will stain your soul and your perpetual reputation as long as you are willing to be their sap. Talk to Tony V. and tell him it’s time to do the right thing. Stop being the sap. Clean house.
Curt, I shall make every effort to bring some airborne bacon during the election.
Jason, I agree we are in for all sorts of distractions. I’ll probably get distracted, too, because when Roger Hunt and Fred Deutsch bring their anti-trans, anti-woman, anti-progress bills, when some crazy bit of gun nuttiness rears its head, when Dennis sends over a rehash of HB 1234 and merit pay, and when the GOP leadership tries to sabotage the initiative and referendum process, all of that foolishness will need to be vigorously rebutted. You and I and other people of conscience and passion will need to shout back and turn the discussion back to the corruption in which they are complicit in their silence.
96, what odds do you lay for words like yours being able to rick that executive conscience? Would it help the Governor and Tony to come to that conclusion if we make some serious gains on the GOP in the Legislature?
I still like Jackley response to SD democrat press release on Gear Up….
Well YOU Dems voted for it!
Unbelievable. As Leslie states so eloquently. .. bullsheit
We have had various conversations about the audit. Smoke n mirrors.
We all know it. I’m getting more upset that the workabees for Gear-up were unceremoniously discharged. While all the big wig “consultants” and administrators at mud central slither away or stay in place. Those people fired are the ones who made a remarkable impact.
As the late great John Trudell stated once…What’s democracy done for you lately?
Cory, we have got to find a way to make some inroads in this election.
96Tears, I support your words, I’ve resonated with you before and agree, if Schopp could understand that she is seriously setting all women backwards 20 years by keeping her silence rather than standing up against these good ole boys that are treating her like their patsy/ piece of a__, she could go farther than not!
Doesn’t she realize that, if she ever wants to get a decent night’s sleep or look herself in the mirror with dignity, integrity and pride, then speak up!!! You are not the only women to find herself in a position of honor, so prove yourself worthy of it!
Is sitting beside Denny like some giggly prom date making sure you say nothing that could be questioned what you planned for in your life goals?
Gross, embarrassing and seriously, nothing but the oldest profession in the world for a female. Time to stand tall and understand you are NOT between a rock and a hard place except in your mind. You only need the courage to do the right thing. You know what happened, the souls of the children need you to speak the truth.
I promise you, Mz. Schopp not one true educator in any state will ever look at you the same if you don’t. These guys will throw you under the bus faster than you can say, “what?” so don’t say you didn’t see it coming!
Curt Jopling, you beat me to it.
Cory, you wrote, “But legislators should be thinking about the questions they will ask Education Secretary Melody Schopp when she comes to the appropriations committee to ask for funding for her department. They should also direct their Government Operations and Audit Committee to hold extra meetings all through 2016 to interrogate Mid-Central personnel specifically and state department heads and employees generally to find out why corruption has erupted in South Dakota ”
You wrote that tongue in cheek, right? What has changed from the previous audit committee’s not doing its job? These are the same people that were in there before, with possibly the exception of a legislator or two that was appointed by the governor to take the place of ones who had resigned to spend more time with their families or some such. And they no longer have to put up with Kathy Tyler badgering them to do their job.
Four school children were murdered near Platte. All those “educators” that were supposed to put children first failed. Every aspect and employee of Mid Central should be examined with a fine tooth comb. Then we may find out just who those persons were that were supposed to be looking out for the children, but actually stole from those very children. There may have been more than twenty five professional educators who would best be described as greedy bastards! The blood of four students is on their hands.
Lanny, your cynicism is well founded. But like 96 and Oldhag, I’m making a call to conscience. The more awful things like the Platte murders happen, the more weak responses from DOE and the GOP cronies pile up, I have to believe more people will reach their breaking point and declare that they can’t look away from the corruption any longer.
Yo Spike-I recognized the name John Trudell immediately. I just recently watched the movie “Thunderheart” again and recommended it to Deb G. I had no idea he was such a talented individual. He was a fine actor. Who knew? Lucky you.
Oldhag,
Excellent comment!
Curt-maybe they will allow her to answer questions using strips of bacon to form letters. The committee can then claim the aroma distracted them from her answers and then claim double jeopardy so she doesn’t have to be questioned again. It could happen.
Spike if you know Stacey Phelps, ask that he honor the work of Trudell by coming forward with all he knows instead of hiding in shame.
I believe his heart is still good and can be healed and I believe that Trudell will send him strength.
https://tribecafilm.com/stories/john-trudell-american-indian-activist-actor-in-memoriam-tribeca-thunderheart-poet
daugaard has already said that tribes can’t be trusted with GEARUP; that he hates dependency and we don’t need health care unless we can self-pay; that we don’t need liberal arts higher education;….
the only time he makes a correct call is when cornered: firing joop; trying to manipulate acceptance of ACA Medicaid expansion; agreeing that our teacher shortage and underpayment is a disaster;….
deep, red-neck conservatism is an ugly thing in an elected leader. he is a lost cause. his response is to dig in his heels. bad habit, eh cory? south Dakota ethics. Christ!
Kris Kristofferson and the Highwaymen sing a song that is titled
“Johnny Lobo” It’s about John Trudell.
If Daugaard continues to insult the tribal governments, insult the poor that need Medicaid, say organizations like Mud Central(and their 25 greedy bastards, as so succulently stated by Mr. Hall) know what’s best for Natives….. maybe the native vote in SD can become a stronger force again in SD state and Federal elections.
Nah Spike, not since the Pubs have put through the voter ID laws and in SD refuse to allow enough voting centers on the res.
Who is in charge of the “Bored” of Education in South Dakota or should I ask if anyone is in charge?
https://www.youtube.com/watch?v=qDt_3JA4GBQ The Highwaymen and Johnny Lobo.
scenario-lt. gov. daugaard, meet joop bollen:
Scottish beef company gets secret loan from secret Cayman company
November 5, 2013 by ieyenews
By David Montgomery From Argus Leader
***
The investors in Epoch Star and Pine Street were and remain secret. All that was disclosed to the public was that there were fewer than 10, and that none were a bank, financial institution, or “in the sole business of lending money.”
But South Dakota law imposed taxes and regulations on lending institutions.
***
In July 2010, the commission voted 4-0 to grant Epoch Star’s request.
“That’s as firm as we can get,” commissioner John Lillibridge of Burke said, according to a Mitchell Daily Republic report on the meeting.
The loan was “short-term” and carried a high rate of interest — 29 percent….
This high rate was justified, a leader with Anvil Asia Partners wrote in an affidavit, because of the risk…. to protect its existing investors from losing everything.
***
…Roger Novotny, director of the South Dakota Division of Banking at the time….did not “require Epoch Star Limited to obtain a money-lending license” or pay banking taxes.
…loan was secured by Northern Beef’s facility.
Had the Banking Commission ruled Epoch Star was subject to banking laws, it would have been required to apply for a money-lending license. That process typically takes several weeks, said Bret Afdahl, current director of the…Division of Banking would examine financial documents to determine whether to approve the license. Afdahl said the department might look at any one who owns 10 percent or more of a company….
…financial statement of who the lending company is, to make sure they’re above water and solvent,” Afdahl said.
Lenders also have to pay South Dakota’s bank franchise tax. That’s 6 percent per year on net income for companies with income below $400 million. If Epoch Star had had to pay that tax on a full $30 million loan, it would have owed hundreds of thousands of dollars per year to the state with a 29 percent interest rate.
Afdahl said the department or commission typically has to rule several times a year about whether a company is “in the business of lending money.” Every situation, he said, is a little different.
***
After an initial loan of $3 million was made from Epoch Star to Northern Beef, the packing plant used $35 million invested by 70 wealthy Chinese citizens to purchase Epoch Star, along with the loan.
The loan from the Chinese investors was a mere 3.5 percent, far less than the Epoch rate.
“We began with them,” said David Palmer, the CEO of Northern Beef, in a September bankruptcy hearing for the company.