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Fischbach Wants State Banking Commission to Investigate Bollen/SDRC for Tax Evasion

Last updated on 2014.09.09

Word of the day: Capone!

Remember how last November I mentioned that EB-5/Northern Beef Packers scandal fulcrum Joop Bollen might have broken the law by lending money without a license and not paying bank franchise tax? I elaborated on that tax-evasion thesis last week.

And now Brown County Commissioner Tom Fischbach thinks there might be some there there:

Tom Fischbach wants his fellow Brown County commissioners to consider a resolution that might allow the county to collect $1.76 million in bank franchise taxes.

...SDRC Inc. doesn’t have a money lending license to legally make loans and does not pay the bank franchise fees, according to the resolution.

In that vein, the resolution said, SDRC Inc. “may have defrauded South Dakota of $2.4 million in bank franchise tax avoidance with a $480,000 ongoing annual tax avoidance.”

The bulk of the overall total would be owed to Brown County, according to the resolution [Scott Waltman, "Fischbach Calls for SDRC Investigation," Aberdeen American News, 2014.09.03].

Fischbach says he isn't sure whether SDRC Inc. qualifies as a bank, but his resolution asks the South Dakota Banking Commission to figure that out for us. Fischbach sprang the resolution on his fellow commissioners unannounced yesterday, so commissioners told him to keep his pants on until next week's meeting.

Did Joop Bollen run a bank without a license? Did Joop Bollen evade bank franchise tax? Those questions aren't just academic or blogospheric scandal-mongering. Those questions can tell us whether Joop Bollen, acting under the authority of Governor Mike Rounds and Governor Dennis Daugaard, cheated Brown County and South Dakota out of another couple million dollars.

I think those questions are worth answering. So does Commissioner Fischbach.


  1. Jim 2014.09.03

    Good for Mr. Fischbach. Maybe while the commission is at it, they can explain to us how it reached the determination off-shore lender Epoch Star was not a bank when it loaned NBP 30m, then got paid back 35m.

    Have any of the September 24 "invitees" declined or accepted the invitation to appear in front of GOAC?

  2. Nick Nemec 2014.09.03

    I agree, good for Mr. Fischbach. It's too bad the system in South Dakota is rigged by the appointment of political cronies, rest assured this issue will be swept under the rug. Move along folks nothing to see here.

  3. jerry 2014.09.03

    Mr. Fischbach is a courageous man to take this on. I wonder how Brendan Johnson can look at himself in the mirror each day knowing that his decision to sit on his hands is allowing the corrupt machinery of South Dakota politics to just keep turning. My questions is this, is Johnson a part of this corruption? What do they have on him to keep him silent?

  4. Danno 2014.09.03

    I expected to see more conjecture on the "suicide", but I didn't expect to see this.

    Wonder what the feds are coming up with, nothing but crickets from them thus far... *chirp*...

  5. 96 Tears 2014.09.03

    I agree, jerry, that Commissioner Fischbach is courageous to use his jurisdiction's power to seek justice where the Republican Party operatives in Pierre have stopped news reporters and the public from obtaining information and justice ... so far. The Republicans' objective is running down the clock until Nov. 4.

    You are completely incorrect about Brendan Johnson on two counts. One is it is Justice Department policy to turn an investigation like this over to someone else in the Justice Department who does not have the appearance of a conflict of interest. The second is covered by Rapid City attorney Patrick Duffy in his August 22 press conference:

    "Many of you already know this that Brendan Johnson is strictly forbidden from taking any actions at all that might influence an election," Duffy said. "Prosecutors cannot take steps to influence elections. Prosecutors cannot reveal what their grand jury is doing."

    At the State Fair, I heard Republican friends slip the incorrect piece of information you used above into our conversation. No doubt, this is on the state GOP talking points to confuse the discussion of Rounds' Benda/EB-5 disaster or to deflect blame away from Marty Jackley's obvious political manipulations of the Benda death investigation and his other statements.

    By the way, I found the GOP loyalists had no comeback to the question why Jackley ordered three felony counts and a grand jury against Benda two weeks before he was shot, but only told the public about it last month. "Don't you think Stace Nelson might have found that piece of information useful in making the case against Richard Benda's boss, Mike Rounds?" I asked.

    I guess the talking points to confuse the pubic or blur the facts on that malfeasance of office haven't been released by the SDGOP office yet.

  6. Roger Cornelius 2014.09.03

    Brendan Johnson cannot ethically sit on his hands regarding EB-5, and I doubt that he is. Johnson seems to be more cautious than anythingl
    We have to look at the whole ripple affect of EB-5 and the intricate parts of state and federal government involvement.
    For instance, in the early revelations about EB-5, Mercer and Cory both reported that there were no less than 6-8 federal agencies investigating the failed EB-5 program and the bankruptcy of Northern Beef Packers.
    We don't know if those investigations have been completed and what role, if any, Johnson plays.
    Is there still a sitting federal grand jury and have they completed their discoveries?
    I'm still not clear if there ever was a state grand jury investigating EB-5. I maybe wrong, but the only reference I heard to a state grand jury was the one Jackley planned to convene on Benda's fraud.

  7. jerry 2014.09.03

    Of course 96tears and Roger, you are correct and I am a little robust. My thoughts are not so much about the crooked dealings of both Rounds and the current governor, but more on the Joop Bollen issue of money laundering and bank fraud. That to me, along with everyone else, is where the rubber meets the road. I do not believe that Jackley can do much if anything on this as it has to do with federal issues. That is why I bring up Bendan Johnson, to me this is RICO. Also, I have not been made privy to republican talking points, nor have I read them. My thoughts are my own and I admit they may be cloudy, but I posted them anyway. When Jackley's wanted to convene a grand jury against Benda, I wonder why? If there was a fraud or if it was simply business as usual in current Pierre politics that have an international grasp with investors and off shore "banking" or loan sharking, take your pick. What if it was a case of a blackmail scheme that went bad? Maybe Jackley should release all of the information regarding his plan to bring in a grand jury against Benda for all to see.

  8. Rorschach 2014.09.03

    "Speak softly and carry a big stick; You will go far." Teddy Roosevelt

    Don't criticize Brendan Johnson. Patrick Duffy and 96 Tears are right. The US Attorney's job is not to play politics. It's to charge out crimes if and when the investigation is concluded and the facts are there for a prima facie case of whatever the charge will be.

    PS: President Obama demonstrated this concept in the hunt for Bin Laden. He didn't promise to "git 'im" or strut about claiming we're getting close. He just wielded the big stick.

    The Justice Department wields a big stick too. And Brendan Johnson speaks softly.

    Back to Teddy Roosevelt, who made a career cleaning up government corruption and reining in the power of big corporations. Here's another quote: “In any moment of decision, the best thing you can do is the right thing. The worst thing you can do is nothing."

    I wonder what Teddy would say about his own party's officeholders in SD today?

  9. Roger Cornelius 2014.09.03


    The SDGOP and the "Powers that be" are labeling EB-5 as a conspiracy theory rather than a criminal investigation.

    By labeling it as a conspiracy theory they attempt to paint those those have questions as all tin foilly and irrational. I made this observation on DWC and it was promptly taken down by that Powers to be guy.

  10. jerry 2014.09.03

    LOL, "Powers to be guy" Good stuff Roger. Glad you don't speak softly. I can say this though, when there is something else going on, there is always some kind of leak thing. Here, with this Bollen dude along with the rest of the corruption, there is nothing. Nothing, not even a drip, tells me that there is nothing going on.

  11. mike fro iowa 2014.09.03

    Maybe you can get Obama to replace Johnson as US Attorney. He doesn't appear to be partisan enough to suit me. He should be going after Wingnuts with a vengeance. If wingnuts complain,accuse them of being un-;murrican.

  12. larry kurtz 2014.09.03

    mike, getting sideways with me is not recommended: fix your handle.

  13. Roger Cornelius 2014.09.03

    The government needs to be very cautious with leakers or whistleblowers, we don't know the if there are immunity or partial immunity deals that are being made, if any.
    Also, those that provide the government with information need to be protected if they feel their lives are in jeopardy.
    Don't expect to hear too much from them, Patrick Duffy issued a call for people that know anything to come forward, I hope they do.

  14. grudznick 2014.09.03

    This is indeed good news. I, too, sent a resolution to the SD Banking Commission demanding they investigate this.

  15. mike from iowa 2014.09.03

    Celebrating my black heritage.

  16. caheidelberger Post author | 2014.09.03

    Danno, I have a feeling the bank franchise tax question has more potential to bring out the handcuffs than Benda's death.

  17. caheidelberger Post author | 2014.09.03

    [Mike: ha! If you want to fix, consider clearing your cache.]

  18. caheidelberger Post author | 2014.09.03

    Jerry, I can't get into divining nothings from nothings. Does Johnson leak anything about human-trafficking investigations and prosecutions? I can imagine a worst-case-best-case combo: if the worst is true about Rounds—big corruption, big crimes, smoking guns a plenty—and the best is true about Johnson—absolutely scrupulous in execution of his duties—Johnson would work extra hard to plug leaks and avoid any hint of abusing his power to affect the election.

  19. mike from iowa 2014.09.03

    Wheels of justice turn slowly when they aren't turning at all. Or there is no particular urgency to get to the bottom of the investigation.

  20. Roger Cornelius 2014.09.03

    If you understand how scandals play out,you should know that they can take as long to investigate as the scams themselves.
    All the speculations and informational leads, whether true or not, need to be followed. This scandal has far reaching affects and as pointed out by Cory, the Benda death investigation is only a part of it.
    Aside from what the federal investigation may or may not involve, there are apparently lawsuits from the Chinese investors that could possibly reveal a lot that we have not considered.
    Over on DWC they are also blaming Johnson for not issuing a report or closing the EB-5 case, let's not fall in that trap.
    I would suggest that if anyone wants to pursue EB-5 politically, they contact the Democratic National Committee.
    We are in holding pattern and it is uncomfortable with the mid-terms so close, but I would prefer that the feds make a indefensible case then just charge in.
    I'm assuming Patrick Duffy knows something we don't that lead him to make the comment that EB-5 is not going to be resolved before the election.

  21. jerry 2014.09.03

    Whatever the case may be, this Bollen character has a lot of splaining to do. Not with a simple Q & A either. I am not being so partisan that I would want a replacement of Johnson that is for sure. I am like many of the rest of you, I just want justice served with an accounting of the money that was lost, strayed or stolen. It bothers me a lot that a sitting governor can make excuses up for not applying Medicaid Expansion because the state does not have any moolah and then not want to do anything about the recovery of funds that were misappropriated. During all of this time, Bollen has increased his wealth several fold with his land holdings. Proving without a doubt that crime does pay if you are on the correct political team.

    You may be correct Cory and I will stand down for the time being with a strong hope that something happens soon.

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