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Tidemann Covers for Bollen, Ignores GOAC Authority and Obligation to Subpoena

Last updated on 2014.08.23

Senator Larry Tidemann (R-7/Tidemann) acts like he's afraid of his own shadow. He chairs the Legislature's Government Operations an Audit Committee. His committee has the power to subpoena witnesses to investigate crimes, corruption, and just plain sloppy work in state government.

Yet, as was the case in June, Senator Tidemann keeps looking for excuses not to use that subpoena power. Heading into today's GOAC meeting, during which the committee is supposed to discuss financial misconduct in the Governor's Office of Economic Development and the EB-5 visa investment program, Senator Tidemann tells David Montgomery that he doesn't think he can subpoena EB-5 chief Joop Bollen:

Tidemann said his committee has a limited scope in terms of investigating a complex scandal that combines government and private business.

“We are not the court system,” Tidemann said. “We can bring in things that deal with state government. I can’t bring you in to talk about your private funds. I don’t think that’s in the authority of GOAC” [David Montgomery, "Legislators Consider Subpoena in EB-5 Case," that Sioux Falls paper, 2014.07.29].

Even though Kurt Evans has taken the weight off my shoulders, permit me to do the attorney general's job for a moment.

GOAC, the Legislature, and all sorts of other public agencies have subpoena power:

1-26-19.1. Administration of oaths--Subpoena powers--Witness fees--Disobedience of subpoena. Each agency and the officers thereof charged with the duty to administer the laws of this state and rules of the agency shall have power to administer oaths as provided by chapter 18-3 and to subpoena witnesses to appear and give testimony and to produce records, books, papers and documents relating to any matters in contested cases and likewise issue subpoenas for such purposes for persons interested therein as provided by § 15-6-45. Unless otherwise provided by law fees for witnesses shall be as set forth in chapter 19-5 and be paid by the agency or party for whom the witness is subpoenaed.

Failure of a person to obey the subpoena issued pursuant to this chapter may be punished as a contempt of court in the manner provided by chapter 21-34 [South Dakota Codified Law 1-26-19.1].

The Legislature itself acknowledged GOAC's subpoena power in HCR 1010, the resolution the Legislature passed last February to assure us that the Legisalture would do something about the GOED/EB-5 scandal and to forestall pressure for immediate and firmer action against GOED and SDRC Inc.:

...the South Dakota Legislature requests the Joint Committee on Government Operations and Audit to conduct hearings on issues related to the Governor's Office of Economic Development, beginning this 89th Legislative Session upon receipt of three independent audits. Hearings may include a review of all available audits and other information, ordering of additional audits, questioning of persons involved in related economic development projects, and opportunities for public testimony. The committee's powers to summon witnesses and issue subpoenas may be exercised as necessary... [2014 HCR 1010].

Review the rules of procedure for subpoenas in Chapter 15-6, and you find no language exempting private parties or private funds from subpoena. Senator Tidemann may defend his subpoenal reticence with SDCL 2-6-4, which defines the scope of GOAC's investigative power:

2-6-4. Investigative powers of Government Operations and Audit Committee. The Government Operations and Audit Committee may examine all records and vouchers, summon witnesses, and thoroughly examine all expenditures and the general management of each department [SDCL 2-6-4].

That statute refers to government departments. But remember, everything Bollen did in managing EB-5, even after he and Richard Benda finagled EB-5 authority into a private entity to better shield their get-rich-quick schemes from public oversight, he did under authority granted solely by a state contract with the Department of Tourism and State Development (now GOED). The funds Bollen managed were authorized by the state. The $989,946 indemnification fund that Bollen's SDRC Inc. is still holding belongs to the state.

Senator Tidemann, this isn't hard. Governors Rounds and Daugaard allowed the privatization of a state program. Under Bollen, SDRC Inc. was carrying out the functions of a state department. To suggest that state functions are rendered immune from state oversight by handing them to private contractors creates a perverse incentive and escape for corrupt state officials.

Subpoena Bollen. Find out how he used his state authority.


  1. 96 Tears 2014.07.29

    The Rounds Team is all about playing out the clock. This is what Tidemann is doing, conducting a closed hearing on the issue which is not really a hearing, it's a secret briefing dressed up to look like a public airing of this unprecedented mess.

    Their worst nightmare is a competent national news organization realizes this is a scandal with legs that will sink an otherwise impervious Republican favorite in a red state. What they are counting on is the continued laziness of the reporting and editorial staff at the Argus Leader.

  2. caheidelberger Post author | 2014.07.29

    Rep. Susan Wismer raised concerns that GOAC should seek separation of powers and employ independent counsel instead of bringing in AG Jackley to give them legal advice on GOED/EB-5. Rep. Justin Cronin responded that Jackley is elected by the people and thus is "not connected" to the executive branch. Cronin did not acknowledge the fact the Jackley was appointed by Mike Rounds and elected back in 2010, before anyone but a handful of readers here were paying attention to the state's EB-5 program and before anyone knew about the monkeyshines Bollen and Benda were up to.

    GOAC is currently in executive session, chatting with Jackley.

  3. mike from iowa 2014.07.29

    ....and this is a surprise,how? This whole state screams CONFLICT OF INTERESTS,incestuous relations between various parts of gubmint and it stinks so bad dead vultures are flocking around. otoh it doesn't seem to bother the large majority of voters who willingly turn blind eyes to all this shit.

  4. charlie5150 2014.07.29

    Stories being added to the House of Cards....

  5. Sid 2014.07.29

    This sounds like some of the specious "legal" arguments that Jeff Sveen is known. Because of the total lack of logic and sloppiness of the reasoning, this position appears sloppy enough to easily be mistaken for an example of Sveen's work product. It is just shocking that allegedly educated persons would accept such flummery at face value. Anyone have an opinion about the Emperor's new clothes???

  6. 96 Tears 2014.07.29

    Folks, start piecing together who was in the Mike Rounds inner circle when this scam was started and allowed a state agency to become a private business with the right to exclude oversight and public transparency. These inner circle people are still on Daugaard's inner circle or on Mike Rounds' campaign payroll.

    These are the people who knew or should have known what was going on.

  7. larry kurtz 2014.07.29

    And Larry Lucas absent so Susan Wismer was the only Dem vote: she tried to pass a motion to subpoena Bollen and couldn't get a second. Someone on a hot mic said to shut her up.

  8. larry kurtz 2014.07.29

    South Dakota: imagine how quickly a pimp could pay for a green card or wonder how many bad actors were allowed to immigrate while refugees are reviled.

    Stupid state.

  9. Lynn 2014.07.29

    This is so infuriating! I read David Montgomery's tweets earlier and posted a reply here but it was all lost stating memory was used up for this blog. It's just Madville I'm having problems with this.

    Anyways! I'm having this love/hate relationship with South Dakota. I love the state, the land, people and have deep roots here but hate and despise the corruption, cover up, policies such as healthcare, economic development and education. It's like one big white male fraternity simply interested in holding and profiting from power rather than the public good.

  10. Jim 2014.07.29

    Another shameful chapter in EB-5's dirty book of secrets. Tiedemann should issue the subpoenas and let Bollen and let try and quash them if the thinks he has grounds. These are not private funds. I agree with 96 that for the Rounds and the gang that got fat on the program, this is about running out the clock. Does no one in our government have the courage to call timeout?

  11. mike from iowa 2014.07.29

    Don't they have legal counsel? Jackley has already signalled his allegiance to Rounds and not the state of South Dakota. A pre-schooler could figure out you have to subpoena the chief perps if you want answers. Anything less is malfeasance and/or cover-up.

  12. Kathy Tyler 2014.07.29

    Rep. Wismer was called 'out of order' for pushing for more info..the 'other side' so to speak. Am so frustrated.Am anxious to see how the news media handles this.

  13. mike from iowa 2014.07.29

    I will say this again-all records that Bollen wandered off with should have been in state's hands,under lock and key to preserve any and all records. Why has no one in the gubmint made mention of these records. Intellectual curiosity will not kill wingnuts,that seems to be their biggest fear that they may actually learn the facts and facts will scare them.

  14. Lynn 2014.07.29

    Kathy were these proceedings taped either audio or video?

  15. Lynn 2014.07.29

    We have Benda unfortunately being deceased who is serving as the fall guy with SDGOP held state offices releasing press releases stressing the double billing which is small fry and a distraction in all of this.

    All the big players Rounds waiting to be crowned US Senator, Joop Bollen with his nice prominent house on North Main in Aberdeen conducting business as usual, Bollen and Benda's associate from Atlanta is now residing in South Africa with no intention of returning to the US, millions of dollars and state records lost or missing from a once state administered program and a former beef plant sitting idle that will take millions to correct the substandard work to make it profitable if it is ever a beef plant again.

    Local businessmen and regional ranchers are trying to be optimistic about the future of that beef plant but I have doubts. Meanwhile Aberdeen rental property owners are suffering a vacancy glut overbuilt with new apartment buildings when NBP after years of non ending drama finally opened up for limited operations.

    We don't know the status of the Federal EB-5 investigation whether it is limited to South Dakota or nationally and when we will know of the results. Hopefully before the election.

    Did we really expect these Republican legislators to Subpoena Bollen? Is this really a surprise? It's just further confirmation and it's despicable

  16. 96 Tears 2014.07.29

    It's been a wild ride, right Lynn? Too bad Richard Benda can't be here to enjoy it too.

  17. 96 Tears 2014.07.29

    The hearing today is a disgrace to our state. Just scanned D. Montgomery’s version on his blog. Jackley’s role in any part of this appears very suspect, particularly this graph in Montgomery’s story:

    “The draft arrest warrant and complaint (against Benda) were prepared Oct. 8. But it hadn't been finalized before Benda's body was found on Oct. 22, two days after he died on Oct. 20 in what a coroner and Jackley concluded was a suicide. Jackley also said a state grand jury was scheduled to meet on Oct. 28 concerning Benda. That meeting was cancelled after Benda's death.”

    Then there’s the circumstances of Benda’s death. He didn’t appear to be troubled according to people who saw him before Oct. 20. He reportedly died from a gunshot wound to the abdomen, allegedly using a tree branch to push the trigger. It took Marty Jackley a full month to make the official determination that Benda committed suicide, when it normally takes days if not hours even in more complex cases. Tell me that doesn’t stink to high heaven!

    I do not believe anything Jackley says about this case. I think he’s up to his eyeballs in deceit to cover for the Mike Rounds U.S. Senate coronation. It’s just as likely that Richard Benda was murdered to silence him as a possible plea bargain witness, and there appears to be a lot of people who to date have benefitted from that old saying “dead men tell no tales.”

    Right under Mike Rounds’ nose, Benda walked out with a $1 million check, and had been under investigation by Jackley for misappropriating $550,000. Hundreds of millions of dollars from hundreds of “investors” in South Dakota’s EB-5 scam passed hands out of view to bankroll megadairies, the scandalous beef plant in Aberdeen, and God knows what else.

    And today, Susan Wismer tried to get a motion to subpoena Joop Bollen, the person other than Richard Benda who should know a lot of answers to the barrels of questions coming out of the Rounds’ Governor’s Office of Economic Development. She could not even get a second since the other Democrat on the committee was absent.

    Meanwhile, Team Rounds is watching the days fly off the calendar, waiting for November 4th to hurry up before this powder keg blows up.

  18. caheidelberger Post author | 2014.07.29

    I heard that part, Rep. Tyler. Rep. Wismer was declared out of order for asking questions not on the list of questions that Republicans wanted to ask.

  19. Lynn 2014.07.29

    Cory that is why it would be great to get some public record from that hearing whether a transcript, video or audio. Rep. Wismer being declared out of order is incredible!

  20. Roger Cornelius 2014.07.29

    Okay Madvillians, time to lawyer up and have the SDDP sue Marty Jackley, Dennis Daugaard, and Mike Rounds.

    Susan Wismer needs to put together a solid legal statement on this hearing, she needs to ask for legal assistance to challenge this cover up unfolding before our eyes.

  21. Jenny 2014.07.29

    We should all go on 100 Eyes today at 3:00 over at the Argus Leader and demand Lalley, Ellis and Montgomery to start seriously investigating this. I like the idea of the SDDP suing. Could the SDDP sue the state for crimes?
    Lynn, Roger, Cory - make your comments be known on 100 Eyes! I'm serious!

  22. Douglas Wiken 2014.07.30

    News papers tend to cover one press conference on a particular subject, and then ignore further investigation on same topic as "old news". Janklow was aware of this and said because he was an official, he could always get press coverage, but challengers get only one shot and then are ignored.

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