Elisa Sand reports another cost of South Dakota’s EB-5 scandal: the EB-5-funded Northern Beef Packers, the beef plant that took five years to build with three rounds of foreign investment from Korean and Chinese immigrants who paid $95 million to buy their way into America only to go bankrupt after nine months of operation, will leave private and public creditors high and dry to the tune of almost $80 million:
Nearly $80 million that more than 100 investors, businesses, government entities and individuals claim they are owed won’t be paid back in the Northern Beef Packers bankruptcy process.
In the latest bankruptcy notice to trustees and application for compensation filed Nov. 2, court documents reveal there’s a little more than $1 million available to pay a long list of bills [Elisa Sand, “Nearly $80 Million Won’t Be Paid Back in Northern Beef Bankruptcy,” Aberdeen American News, 2017.11.10].
Among those left holding the bag—you and me:
The Internal Revenue Service is seeking $929,709. The South Dakota Department of Revenue has two claims totaling $871,287. The South Dakota Department of Labor claim is $30,636.
…Also on the list of unsecured claims that won’t be paid is the city of Aberdeen at $250,269, other government agencies and many businesses, some of which are local.
City Attorney Ron Wager said Aberdeen’s claim is for unpaid water and wastewater services [Sand, 2017.11.10].
Among other creditors, bankruptcy documents indicate NBP stiffed the USDA $51K, Northwestern Energy $447K, Avera St. Luke’s Hospital $80K, Grote Roofing $22K, and Production Monkeys nearly $16K.
The beef plant is up and running. Sand notes that DemKota Ranch Beef “has no ties or obligations to the bankruptcy proceedings.” That statement is true, but it should not submerge the fact that DemKota Ranch Beef exists only because Northern Beef Packers was part of a money-making scheme that enriched the EB-5 visa peddlers while burning up $167 million in capital and producing an ag-industrial boondoggle that one lucky investor was able to acquire for three cents on the dollar while dozens of other investors, numerous contractors and suppliers, and all of us taxpayers provided a nearly $80-million subsidy that we’ll never get back.
As a thank-you, is there any chance DemKota could send out coupons for chuck roast at Ken’s?
Here’s something to look for: who acutally got money from these folks? When the sewage ash scam folded, it turned out that local businesses got stiffed, but the politically connected folks who pushed the thing through got paid off up-front. Yup, the movers and shakers got their money, the consultants who lied during state hearings got paid off, the workers in the Twin Cities got paid, but the local folks who took a bath. That’s economic development in South Dakota. As long as the the right people get paid, that’s all that matters.
DemKota Ranch- would that a Phoenix of any name smell as swee……er….scandalous.
That $80 million didn’t just burn up in a bonfire … poof! It exists somewhere in the world today. The question is, whose overseas bank account(s) is it in? This was a shell game used to divert money through international shell entities and render it untraceable. By leaving the money overseas, the Americans who own the foreign shell companies are able to avoid paying US taxes on the money. How much of that money is the Joopster hiding? How much of that is the Rounds family hiding? Or the Joopster’s lawyers? Maybe someday there will be a new “Panama Papers” style release and we’ll find out. Until then, the fraudsters would seem to have successfully made off with the money.
Ror, I’m waiting to see if Paul Manafort got some of that money.