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Bollen Says EB-5 Everyone Else’s Idea; State Forced Privatization

Mike Rounds has gotten by with a big lie; now his EB-5 czar, Joop Bollen, tries to do the same thing.

Here is the audacious central narrative of Joop Bollen's response (don't forget page 20!) to the Government Operations and Audit Committee's inquiry into his activities as director of South Dakota's EB-5 visa investment program (I paraphrase):

EB-5 was everyone else's idea. The state authorized everything I did. Privatizing EB-5 was the only option left to save the program. The state could have made millions from EB-5, but the state didn't have the guts to see it through. I not only did nothing wrong but did wonders for South Dakota. State officials and media have destroyed that program and lied about me. F--- you.

There is no contrition in Bollen's response, no acknowledgement of any wrongdoing. Instead, he appears ready to fight for total vindication.

Consider the charge that Bollen defrauded the Board of Regents and the state of South Dakota by contracting EB-5 out to his own private company. Bollen says...

  1. He signed no contract with himself; the January 2008 agreement between the SDIBI that he ran for the state and the SDRC Inc. that he incorporated was merely an explanation to the USCIS of a new element of South Dakota's EB-5 program.
  2. The Governor's Office of Economic Development told him to create SDRC Inc.
  3. He didn't consider himself the owner of SDRC Inc. until June 2009.
  4. He intended SDRC Inc. to be a revenue stream for the state, but in 2009, "it appeared that NSU and the state system didn't have the stomach to accept the liabilities that were associated with the entrepreneurial activities they asked for and encouraged me to establish and for which I was hired" [Bollen, 2014.11.10, p. 9].

In other words, a contract is not a contract (lawyers, start your engines), and the state was too chicken to take the revenue stream SDRC Inc. offered.

Consider the charge that Bollen hauled away state documents without permission when he quit his job at Northern State University and walked away to the golden parachute of doing the same job at his private company. Bollen says...

  1. GOED actually owned those documents, not NSU.
  2. GOED told him to take those documents.
  3. NSU President James Smith defamed him by saying otherwise.

Do you hear the lawsuit threat? Bollen sounds ready to go to war with anyone who got in the way of his operation, whether it's the reporters who've been uncovering the most damning information about his self-dealing corruption or the president of NSU who came to power in 2009 and found Bollen's activities incompatible with Northern's mission.

Bollen drops as many other names into his narrative as he can, so that just in case anyone does decide something went wrong with EB-5, he can blame everyone else. According to Bollen...

  1. Bill Janklow gave Bollen and SDIBI its real authority back in 1995 because Bollen was doing such good work [p. 2].
  2. NSU President Hilpert got SDIBI more closely involved with GOED in 2000 [p. 3].
  3. Richard Benda persuaded SDIBI to pour EB-5 money into Northern Beef Packers in 2006 [p. 3].
  4. GOED mandated that SDIBI work with the Hanul Law Firm (i.e., it wasn't just some hinky, off-book deal between Bollen and his Korean jail-break buddy James Park) [pp. 3–4].
  5. Maurice "Morrie" Berez "strongly suggested" SDIBI replace the EB-5 equity model with the new loan model under which Bollen created his private company and numerous separate private loan funds.
  6. In its January 2008 agreement with SDIBI, GOED essentially directed Bollen to create SDRC Inc. [p. 5]
  7. Regents lawyer Jim Shekleton and Regents exec Tad Perry had Sherry Anderson audit SDIBI's finances in February and March 2009.
  8. NSU lawyer John Meyer was keenly interested in the successful investment of the EB-5 money flowing to the Huron turkey plant in April 2009 and was advising Bollen on how to manage those investment flows [pp. 6–7]. (Note that this assertion sounds absurd: throughout his statements in the Darley litigation, Meyer portrays NSU as not exercising any role in SDIBI's operations. Bollen's burning of the Regents with his self-representation of SDIBI in the Darley lawsuit would likely have inclined Meyer to keep NSU away from any further risk of liability. NSU's focus during this time appeared to have been to put SDIBI on hold, not facilitate its activities.)
  9. Richard Benda, GOED lawyer Tim Engel, NSU VP Don Erlenbusch, John Meyer, and Dr. James Smith all knew Bollen was going to privatize SDRC Inc. and all approved of the idea.
  10. Assistant Attorney General James Hallem was included in the privatization conversations [p. 8].

Joop's message: Don't try hanging me. If EB-5 is a hanging crime—and it's not, it's fabulous!—you're hanging all the decision-makers above me.

Bollen's response is a belligerent, legalistic tour de force. He pins success to himself and culpability to everyone else. And he makes clear he's playing not just to escape but to win. Let's see if our GOAC legislators have the stomach to sift fact from arrogant fiction in Bollen's tale and get the straight story on EB-5.


  1. Bill Fleming 2014.11.11

    Hi Cory. When I click on your 'page 20' link, I get:

    "500 - Internal server error.
    There is a problem with the resource you are looking for, and it cannot be displayed."

  2. Bill Fleming 2014.11.11

    Okay, actually both links get that result now. Did you save copies? ;-)

  3. Lanny V Stricherz 2014.11.11

    Cory, Did Bollen actually have this in his written text? "State officials and media have destroyed that program and lied about me. F--- you."

  4. Greg 2014.11.11

    Marty Jackley will not touch this case. It's time the Feds come in and clean this up and make examples of people who lie.

  5. leslie 2014.11.11

    the daft cliche': "follow dah money, we wont dah money"-of the nihlists in "the big lebowski" is the truism, as ever was the moovee, fits nihilist joop.

    a. did he make any money; when; how much; why? he's been lawyered up since when; who?

    b. Sveen make any money; when; how much? Any accountants involved; who; when?

    gonna take good investigators 'cause there have been alotta lawyers, other professionals on this fabulous gravey train of chinese, Korean and other money the green cards were auctioned of at ever greater prices for a chance at citizen ship, or residence anyway at the outset, by joop and perhaps benda

    why did he take his ownlife joop? 800,000 of us and a few thousand legal residents are wondering? good ole' capitalism with public and others' money is protected from prying public eyes by SDRC Inc, SDRC, SDBICI, GOED, GOAC, rounds, Gov. daugaard, AG jackley, lawyers, lawyers, lawyers and SDGOP. no whistle blowers in this elite crowd and affiliated rabble, PACS and good ole' boys!! Are there any women in this bunch?


  6. Bill Fleming 2014.11.11

    Lanny, no. See Cory's note above Joop's 'paraphrased' quote. Cory wrote that as a tongue-in-cheek, satirical summary distillation of what he perceives Joop's 'between-the-lines' message to the committee and the people of SD really is.

  7. Anne Beal 2014.11.11

    Is the FBI agent in charge of the open investigation back from his vacation yet?

  8. larry kurtz 2014.11.11


  9. Daniel Buresh 2014.11.11

    Jackley really can't touch Joop once he left the state, and ethical violations are not criminal. Joop really only has/had the Feds to worry about.

  10. Jim 2014.11.11

    Did they release the exhibits attached to his answers? Didn't see those in the link.

  11. Bill Fleming 2014.11.11

    Daniel, doesn't it seem that Joop is being especially defensive about Ross's and Mercer's muckraking activities? Perhaps they've uncovered some activities there that Jackly may have overlooked or not been privy to at the time of his investigation? I wouldn't be too quick to issue Bollin's get-out-of-jail free card just yet. Cory and others have already noted several state statutes he violated. I say, let's just keep the pressure on and see what happens. Joop says Benda didn't do anything wrong. Okay, so why then did he shoot himself? Has anyone asked Bollin that question?

  12. Daniel Buresh 2014.11.11

    At this time, I haven't seen anything to get Joop on at the state level, not to say that it isn't possible. I'm not giving him a get out of jail free card and I think the feds are going to get him on something, and maybe others as well. I just don't see it being Jackley because things mostly got fishy after Joop left the state. I think Joop needs to maintain Benda wasn't doing anything wrong to save his own skin. I find it hard to believe Benda was planning to take that 500k without Joop being in on it since that was where he was going to be employed and essentially get his pay off. Someone over at SDRC had to be planning on cashing that check from NBP and giving it to Benda.

  13. Patrick Duffy 2014.11.11

    What exactly are the duties and responsibilities of a loan monitor?

  14. Susan 2014.11.11

    So, who exactly did Hanul represent? So the GOED directed Bollen to work with a law firm that has no attorneys licensed to practice in South Dakota? No red flags there.....

  15. leslie 2014.11.11

    db-why wouldn't jackley go after joop doing SD business crooked in CA, So. Korea or anywhere else in the world?? other than the politics of course. civilly and criminally.

  16. Daniel Buresh 2014.11.11

    Jackley has no jurisdiction in CA, So Korea or anywhere else in the world. It amazes me how little understanding people have of our legal system.

  17. mikeyc, that's me! 2014.11.11

    I figured that's why the Republicans are treating him with
    kid gloves. Because of all the people he can take down with him.

  18. caheidelberger Post author | 2014.11.11

    Mr. Duffy, good question about the duties of a loan monitor. Mr. Bollen says that work included "reviewing all work done at the plant and all invoices and payments to be made. Benda had an office at the plant and was there on a daily basis" (see Bollen response to question #16). Bollen says that work was required by the NBP loan agreement (see Bollen response to question #8).

  19. Roger Cornelius 2014.11.11

    Bollen did drop a lot of names in his overview and questions, those that could be a threat to him and those that could possibly defend him.
    What names he omitted are the names of those he refuses to identify; bookkeepers, accountants, consultants, lawyers, etc. that were specifically asked of him. Bollen remains obstinate about who actually owns SDRC, Inc. or who his partners are or were.
    Bollen insists that the state has records and audits of SIBI and SDRC financial activities, who in the state haw those and records and why haven't they been released to the public?
    Bollen's whole narrative and questions are self-serving and defensive, he constantly dodges and evades the most basic questions.
    His contention that SDRC is a private business and invokes his confidentially is in direct contradiction to many of his statements, including any audits, reports, etc. he made to GOED.

  20. Roger Cornelius 2014.11.11

    Bollen states that the FBI told him in his two interviews in 2013 that Richard Benda was the focus of their investigation, the FBI does not identify persons of interest, potential suspects or who is the focus of an investigation.

  21. Patrick Duffy 2014.11.11

    I see the answers but still don't have a precise idea of what a loan monitor does and the powers he possesses. Elsewhere in Mr. Bollen's answers, he claims that information concerning other loan monitors, including identity, duties and compensation, are protected from discovery because they are "trade secrets." No law is cited, and I don't understand this, either.

    I also don't understand why at a time when capital is as cheap as it has been in a century, these projects needed the EB-5 market for financing. If they produced the incredible results claimed during the campaign, these were stupendous investments indeed.

    Which loans does the Loan Monitor actually monitor? To whom does he have a duty to report, and what are his reporting requirements?

  22. Roger Cornelius 2014.11.11

    Do you have any idea what the exhibits in Tidemann's letter are? I haven't been able to find them, it just highlights them in the letter.

  23. caheidelberger Post author | 2014.11.11

    I do not, Roger. I have not seen the exhibits posted anywhere.

  24. Troy 2014.11.11


    I presume this isn't an attempt to litigate this in public or on a blog but sincere questions. While I don't know any of the specifics about any of the EB-5 projects, I can answer your questions on what a loan monitor does, what is traditional monitoring/reporting requirements, why some business endeavors may prefer/need financing from non-traditional sources.

    Cory has my email address and contact information.

  25. bearcreekbat 2014.11.11

    Daniel Buresh commented at 15:29 that "Jackley has no jurisdiction in CA, So Korea or anywhere else in the world. It amazes me how little understanding people have of our legal system."

    Daniel misunderstands the concept of "jurisdiction" in the legal system. Jurisdiction refers to the power of a Court, not the AG. Simply because someone leaves the state does not deprive SD courts of either criminal or civil jurisdiction. Likewise federal courts can exercise whatever statutory jurisdiction Congress has given the Court regardless of where a potential litigant runs to hide.

    In other words if Jackley has evidence Bollen committed a crime in South Dakota, Jackley could seek an indictment in a SD Court. Once issued, the next step would be to seek Bollen's extradition back to SD for trial. Jackley could also file a civil suit against Bollen in SD using SD's "long-arm" statutes, which reach anyone who has had at least minimum contacts with SD, a test easily met with Bollen.

  26. larry kurtz 2014.11.11

    blood in the water: priceless.

  27. larry kurtz 2014.11.11

    "Troy Jones Jr., now a private business developer in Sioux Falls, was the finance director for the REDI program during the first loan deal with Angus-Palm. He worked closely with Calvin to put the details together and they have continued to stay in touch and at times hunt together.
    "John Calvin is a great marketer. That's how he built his business," Jones said. "I can't think of a better person (for the state post). The staff is going to love him. He's a great motivator.""

  28. larry kurtz 2014.11.11

    Anyone watching a motel in Pierre connected to Bendagate in flames?

  29. Roger Cornelius 2014.11.11

    So now Troy is being as coy as Bollen in answering questions, a job description isn't a matter of litigation, it is simply information.
    Hopefully Patrick will share Troy's answer.

  30. Bill Fleming 2014.11.11

    Roger, I don't know nearly as much about it as Troy does, of course, but I think loan monitors are basically fiscal control agents for the investors. They make sure the money gets spent the way it's supposed to be spent. Checks all the contractors and suppliers invoices against their bids, contracts, etc. Basically lets the investors know if everything is going according to plan before they release their funds. Is that close, Troy?

  31. Troy 2014.11.11


    That is the simple answer and I presume Pat knows that. He is a smart guy. I assumed he wants a more detailed discussion to understand on a deeper level. If he were to call, I imagine it would take hours to answer all his questions.

    Btw, I know Pat and his pRents and siblings. He is bright for a Ft pierre boy. :)

  32. Bill Fleming 2014.11.11

    Well, I'm a simple guy, Troy, as you know. ;-) And yes, Mr. Duffy is a sharp customer. I'd live to be a mouse in the corner if you guys get into a conversation. Maybe you give him one of the steaks I owe you? LOL

  33. caheidelberger Post author | 2014.11.11

    Daniel, I have enumerated a variety of violations on which the state could prosecute Bollen:

    How many violations does it take to get Jackley to enforce the law? How many violations of state policy does one get to make before the Governor fires the violator?

  34. caheidelberger Post author | 2014.11.11

    Larry, are you contending that Troy is unqualified to explain what a loan monitor does? Or is there something more to your mention of Troy's work?

  35. Patrick Duffy 2014.11.11

    Troy, call my office in Rapid and we'll talk.

  36. larry kurtz 2014.11.11

    i just plow the road, cory: duffy makes the snowman.

  37. Patrick Duffy 2014.11.11

    Mr. Bollen's answers must have been reviewed by counsel, especially after I pointed out the potential criminal legal hazard faced when one submits false answers to GOAC, a story covered by Mr. Tupper in the Rapid City Journal.

    The reference to Mr. Rounds' Chief of Staff was therefore a revelation not lightly made, for both political and legal reasons.

    GOAC now has its hands full and it does not appear the committee will be able to conclude its investigation without compelling the production of more information.

    This will be an interesting legislative session.

  38. Jim 2014.11.11

    Joop says other loans had loan monitors, but can't reveal that as it is "private business information." This is BS. Joop and sveen just don't want that information known.

  39. Jane 2014.11.11

    Question for Bollen, did he meet James Park well before 2000? During that time did James Park offer the fees based compensation? What are the details of that fee based comp? Did he take this fee based comp in addition to his normal salary at NSU? Did the Regents approve the additional or special comp?

  40. Jane 2014.11.11

    When Bollen states that The State privatized the EB-5, Bollen just tossed the former Governor under the bus!
    But, the real puppet master looks to be someone that hides behind the pawns. The names Bollen throws down seem like all tools.

  41. mike from iowa 2014.11.12

    Mr Duffy,when you say the commitee will have to compel more info,does that mean getting on their knees and offering flowers and chocolates to Bollen? Apparently they have never heard of subpoenas to compel a subject to talk.

  42. leslie 2014.11.12

    hahahahahahaha. this is just the best. daugaard best have lotz a lawyers protecting him. sx falls lawyers.

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