In November 2013, South Dakota Attorney General Marty Jackley staked out the public position that there was no prosecutable violation of state law that justified his taking action against Northern Beef Packers, SDRC Inc., Joop Bollen, or anyone else to recover $550,000 diverted from Future Fund Grant #1434. Last January, Governor Dennis Daugaard upheld that position in an interview on SDPB Radio.
But in October 2013, Attorney General Jackley prepared an arrest warrant for Richard Benda for his diversion of that grant money. The state of South Dakota was prepared to arrest the former state economic development chief for aggravated grand theft for his misappropriation of that big chunk of Future Fund Grant #1434. Here's the relevant text:
AGGRAVATED GRAND THEFT BY EMBEZZLEMENT, in violation of SDCL 22-30A-2, 22-30A-10, and 22-30A-17.1, a Class 3 felony, in that, with intent to defraud, he appropriated money belonging to the State of South Dakota entrusted to him to a use and purpose not in the due and lawful execution of his trust, to wit: Richard L. Benda obtained $550,000 in state funds by diverting economic development grant funds intended for the benefit of Northern Beef Packers, LP to his own use and purpose; or in the alternative
AGGRAVATED THEFT BY DECEPTION, in violation of 22-20A-3(1) and 22-30A-17.1, a class 3 felony, in that, with the intent to defraud, he obtained the property of another by deception by creating or reinforcing a false impression, to wit: Richard L. Benda obtained $550,000 from Northern Beef Packers, LP by creating the false impression that he had the authority to withhold $1,000,000 in grant funds due to Northern Beef Packers, LP unless $550,000 of those funds were paid to Richard L. Benda through South Dakota Regional Center, Inc. for loan monitoring services not yet rendered; or in the alternative
AGGRAVATED GRAND THEFT BY THREAT in violation of SDCL 22-30A-2, 22-30A-4(4), and 22-30A-17.1, a Class 3 felony, in that he did obtain property of another by threatening to take or withhold action as an official, or cause an official to take or withhold action, to wit: between December 28, 2010, and Janaury 26, 2011, Richard L. Benda, while holding himself out as an official or as a person who could cause an official to take or withhold action, did obtain $550,000 from Northern Beef Packers, LP by threatening to cause harm to Northern Beef Packers, LP by withholding $1,000,000 in grant funds from Northern Beef Packers, LP unless $550,000 of those funds were paid to him through South Dakota Regional Center, Inc. for loan monitoring services not yet rendered;
GRAND THEFT in violation of SDCL 22-30A-2 and 22-30A-17(1), a Class 3 felony, in that, with the intent to benefit himself, he transfered [sic] property of the State of South Dakota to himself, though he was not entitled thereto, to wit: Richard L. Benda, between December 14, 2009, and on or about April 16, 2010, did obtain from the State of South Dakota the sums of $982.90, $3,740.60, and $836.30 to which he was not entitled by preparing and filing duplicate vouchers for reimbursement for these travel expenses despite having earlier received reimbursement for these same expenses from the State of South Dakota;
All contrary to the statutes in such case made and provided against the peace and dignity of the State of South Dakota [Attorney General Marty Jackley, arrest warrant for Richard L. Benda, prepared October 2013 but never served, released to Government Operations and Audit Committee, South Dakota Legislature, 2014.07.29].
Class 3 felony—that's up to 15 years in the pen and a $30,000 fine.
Attorney General Jackley released this draft arrest warrant this morning. Bob Mercer reports Jackley prepared these charges on October 8. On October 11, the attorney general scheduled a grand jury to convene on October 28 to hear evidence on Benda's activities. Benda died October 20; an in-law discovered Benda's body and reported it to authorities on October 22. The arrest warrant was never served, the grand jury never convened, and Jackley ruled Benda's death suicide on November 22.
The second count relates to travel vouchers that Benda double-billed to the state. State officials have relatively consistently stated that violation mattered and that the state ought to get that money back.
But sometime between October and November, the state shifted its thinking on Benda's much larger money grab. Instead of looking for a way to return Benda's ill-gotten gains to state coffers, the state decided to wave its hands, mutter something about EB-5 being a federal program, and close the investigation.
Related: Following Jackley's disclosure of the draft Benda warrant to the Government Operations and Audit Committee and a closed-door discussion of legal matters, Rep. Susan Wismer (D-1/Britton) moved to subpoena Joop Bollen, who ran SDRC, Inc., the private company mentioned in the draft warrant. One might think that Bollen could shed some light on what his loan monitor Benda did with the money that the state thought, if briefly, had been stolen. Not wanting to shed such light, no one on the committee seconded Wismer's motion.
Odd: AG Jackley says he never interviewed Benda during the 2013 investigation, but he told GOAC today that his office did question Bollen. The attorney general thought Bollen was worth talking to, but the Republicans on GOAC do not.