A new accessible certificate in a accusation indicates that the accord amid accompaniment government and Joop Bollen — the axial amount in South Dakota’s baleful and bizarre EB-5 aspersion — began to advance and strengthen beforehand than ahead appear and was anchored during the administering of the backward above governor Bill Janklow.
That’s one of abundant revelations in the archetype of a four-hour degradation of Bollen that includes ahead alien capacity about his life, his aboriginal captivation with accompaniment government, and his role in converting a almost small, all-embracing dairy- application activity into a advantageous investment-for-visa processing center.
Another adumbration was the admeasurement to which Bollen insisted that baronial admiral in the administering of above Gov. Mike Rounds, and admiral at Northern Accompaniment University and with the accompaniment Board of Regents, knew and accustomed of alike the best arguable of his EB-5 activities.
The degradation was taken March 20 in Aberdeen, and the archetype became allotment of a accessible cloister book Oct. 10 aback it was absorbed to addition certificate as an exhibit.
Bollen said in the degradation that he began active a association in the 1990s that was housed at Northern Accompaniment University. He said the association was advised to advice addition exports from South Dakota and was the forerunner to what eventually became South Dakota’s EB-5 bounded center. The aboriginal assignment was partially sponsored by accompaniment government, Bollen said, and it bent Janklow’s eye.
Sometime during the 1990s, according to Bollen, he went to Pierre with John Hutchinson, who was Northern State’s admiral from 1993 to 1997, and Clyde Arnold, who was the administrator of Northern’s business school, area they met with then-Gov. Janklow at his appeal and discussed Bollen’s annual to addition accomplishment exports.
The degradation was taken for a accusation in federal cloister accepted as SDIF Limited Affiliation 2 v. Tentexkota LLC, et al.
Bollen manages SDIF Limited Affiliation 2, which in 2009 affiliated $32.5 actor invested by 65 foreigners through the federal government’s EB-5 affairs and loaned it to Tentexkota. In exchange, the foreigners were accustomed visas and again blooming cards acceding them abiding address in the United States.
Tentexkota — comprised of ally including W. Kenneth “Big Kenny” Alphin, of the country music duo Big & Rich — acclimated the money to advice catechumen Deadwood’s celebrated Homestake fungus bulb into the Deadwood Mountain Grand auberge and gaming resort, which opened in 2011.
Bollen is now gluttonous affirmation of the loan, which is in default, but the Tentexkota ally appetite their claimed accommodation guarantees voided. They affirmation Bollen bamboozled them into signing the guarantees by falsely claiming they were a affirmation of the EB-5 program.
South Dakotans knew little about the state’s accord in the EB-5 affairs until 2013, aback Richard Benda, a above accompaniment agent who formed carefully with Bollen, was begin asleep of what was clearly disqualified a suicide by shotgun. It was afterwards appear that Benda had been adverse abeyant case for his declared annexation of $550,000 in accompaniment admission money that was advised for an EB-5-funded beef processing bulb in Aberdeen. At the time, Benda was abrogation accompaniment government and activity to assignment for Bollen.
Revelations about the capacity of EB-5 in South Dakota caked alternating for several years in the courts and the media. Afterwards the aspersion bankrupt in 2013, it adamant the ultimately arrive 2014 U.S. Senate antagonism of Rounds, who succeeded Janklow as governor in 2003.
In February 2017, Bollen pleaded accusable to the abstruse abomination of “unauthorized auctioning of claimed acreage accountable to a aegis interest” and was bedevilled to a $2,000 accomplished and two years of probation. The allegation arose from his aberration of $1.2 actor from an annual that was created to assure the accompaniment adjoin EB-5 costs and liability. He eventually put best of the money aback into the annual — all but $167,000 was accounted for — but not afore he had acclimated some of the money to buy Egyptian artifacts.
In the anew appear degradation taken for the Tentexkota litigation, Bollen, a 55-year-old Dutch immigrant who lives in Aberdeen, appear capacity of his life, the ancestry of his captivation with accompaniment government, and the advance of the EB-5 affairs afore it concluded in scandal.
Netherlands to Aberdeen
Bollen said he was built-in in the Netherlands, in the boondocks of Eindhoven, area he absitively at age 17 that he capital to immigrate to the United States.
The federal affairs at the affection of the lawsuit, EB-5, is alleged for the employment-based, fifth-preference visa. The affairs allows foreigners to access an EB-5 visa, and again abiding U.S. address in the anatomy of blooming cards, in barter for investments of at atomic $500,000 in U.S. business projects that accomplish at atomic 10 jobs.
EB-5 investments are fabricated with the abetment of bounded centers, and Joop Bollen ran a bounded centermost on account of South Dakota as a accompaniment agent from 2004 to 2009, and again as a clandestine architect with the accompaniment from 2009 to 2013.
He went to El Camino Real, Calif., as an barter student; accustomed a aerial academy authority from Calabasas Aerial School; accelerating from the University of California, Los Angeles, in 1986; becoming a master’s in business administering in Arizona in 1987; and got a job with Continental Grain in Chicago, he said.
While traveling for Continental Grain, Bollen met his aboriginal wife, who was from Aberdeen. He said they affiliated in 1990. That aforementioned year, Bollen said, he accomplished to assignment in banking balance for J.P. Morgan, but autonomous instead for a business affiliation with a man alleged Pyush Patel in Atlanta, area the two bought a liquor store.
Bollen said his captivation with accompaniment government began during the aboriginal 1990s afterwards he bought some absolute acreage from the then-mayor of Aberdeen. Bollen did not say the name of the ambassador in the deposition, but 1990 avalanche aural the administering of Tim Rich.
Bollen said he was encouraged by the ambassador to allocution with admiral at Northern Accompaniment who capital to set up an all-embracing beat program, in allotment to access exports from South Dakota.
Bollen said he was assassin to run a association housed at NSU, and he began administering workshops for South Dakota businesspeople who were absorbed in exporting. The workshops generated money for NSU, Bollen said, and the Janklow administering additionally adjourned some of the assignment through the Governor’s Appointment of Economic Development.
“Under the Janklow administering it was actual bright that they capital consign advance first,” Bollen said. “It eventually — the aftereffect was that Janklow transferred the all-embracing administering to Northern for consign promotion.”
“And because (then-NSU Admiral John) Hilpert capital to ballast the accord alike added with GOED, they asked me what can I do?” Bollen said. “And I said, ‘Well, I apperceive that the accompaniment has been aggravating to allure adopted investment, but they never had any success. So that is article that I anticipate I could contribute.’”
Dutch dairies to Korean investors
Bollen said that amid 2000 and 2003 — which would accept included the end of the Janklow administering and the alpha of the Circuit administering — he began alive his focus from consign advance to the allure of adopted advance in South Dakota, with advance from Hilpert.
Bollen auspiciously recruited some dairy farmers from his built-in country who came to the United States on E-2 visas, but there was a problem. He said if the farmers anytime abdicate their dairy business, E-2 acceptance requirements would accept affected them to acknowledgment to the Netherlands.
He started analytic altered kinds of visas to accord South Dakota an advantage over added states.
“And that is how I — you know, you had EB-1, EB-2, EB-3, EB-4, EB-5. You aloof affectionate of go through the application abject visas,” Bollen said.
Bollen apparent that he admired the EB-5 program, he said, because it accustomed not alone adopted investors, but additionally their families to access the United States and access abiding residency. Additionally, the program’s affirmation that projects actualize at atomic 10 jobs could be affected alongside — in added words, a dairy that had alone four advisers could use a multiplier and affirmation it created added jobs alfresco of its own business, such as a milk-truck disciplinarian and secretary for the trucking company.
So, Bollen said, in 2002 or 2003, he flew to Washington, D.C., and met with the arch of the federal EB-5 program, housed aural U.S. Citizenship and Immigration Services. Up to that point, he said, bounded centers that were set up to accept EB-5 investments had been clandestine entities. On account of South Dakota, Bollen said, he accustomed the aboriginal state-run EB-5 bounded centermost in 2004.
Then, he flew to Europe to recruit added dairy farmers.
“And acquaint them here, look, you can go to Michigan, you can go to Ohio, but you accept an E-2 visa,” Bollen said. “If you appear to South Dakota, you get a blooming card. So appealing abundant arrest the added states.”
Bollen said the affairs ultimately financed $90 actor account of dairy farms forth the Interstate 29 corridor.
The affairs eventually morphed into article added than a dairy-recruitment project. Bollen said that aback the U.S. Administering of Commerce appear a new account of EB-5 bounded centers, he was anon inundated with calls from abroad, mostly from South Korea.
“People who capital to appear to the United States and capital to acquisition a way in,” Bollen said.
‘ I bare bigger projects’
Before long, Bollen said, bounded centers popped up in added states, and South Dakota absent its aggressive advantage in adopted dairy recruitment.
“I bare bigger projects,” he said. “And dairy farms were no best acid it. I knew Mike Circuit was actual absorbed in the certified beef program.”
That’s how Bollen became complex in alluring EB-5 investments for a proposed meatpacking bulb in Aberdeen alleged Northern Beef Packers, which was advised to action beasts that were certified as bred, built-in and aloft in South Dakota. The activity ultimately went through bankruptcy, abrogation $80 actor in contributed debts, afore it was reborn afresh beneath new buying as DemKota Ranch Beef.
When Bollen got complex with the Northern Beef Packers project, he met Benda, who was Rounds’ secretary of tourism and accompaniment development. Benda’s job included blank of the GOED. Bollen said it was bright that Benda and the accompaniment “wanted this beef project.”
Bollen said advance in the beef bulb came from Korea and China, in two circuit that anniversary yielded about $35 million. Added projects followed, and South Dakota’s EB-5 bounded centermost took off.
Bollen said the aboriginal EB-5 archetypal complex disinterestedness investments, in which banks vetted and financed projects to which foreigners contributed investments. But Bollen said South Dakota’s EB-5 centermost acquired about 2008 or 2009 to a archetypal in which adopted investments were affiliated and loaned to projects afterwards the captivation of a bank.
“And the affidavit for the accommodation archetypal were appealing persuasive,” Bollen said, “and it had to do with avenue strategy. If you’re an disinterestedness broker and afterwards bristles years accepting a abiding blooming card, it’s a little harder to get out of a business than it would be with a accommodation that is advancing due.”
“… look, you can go to Michigan, you can go to Ohio, but you accept an E-2 acceptance … If you appear to South Dakota, you get a blooming card. So appealing abundant arrest the added states.”
— Joop Bollen, on what he told investors about the EB-5 acceptance affairs and its use in South Dakota
SDRC Inc. is born
It was for agnate affidavit that Bollen said he created a clandestine aggregation alleged SDRC Inc. in aboriginal 2008 and assigned it some albatross to advice administer South Dakota’s EB-5 bounded center. That move, aback it was afterwards appear publicly, became a focal point of the EB-5 aspersion amid critics who declared it as self-dealing — Bollen had still been a accompaniment agent beneath the administration of NSU aback he fabricated the accord with his own company.
Bollen said in the degradation that one acumen he created SDRC Inc. was to appoint bodies to do the activity vetting that was aforetime done by banks. He said the absorbed was for NSU to eventually own SDRC Inc. That plan exploded in mid-2008, Bollen said, aback a California aggregation alleged Darley International, which had been allowance to recruit EB-5 investors in China, claimed that Bollen and addition advance recruiter had breached several aspects of their aggregate contract.
“And aback Darley started that accusation all the bureaucrats aloof came to a shrieking arrest and became scared,” Bollen said.
Bollen said he was eventually directed to absolutely about-face over administration of South Dakota’s EB-5 bounded centermost from NSU to his clandestine firm, SDRC Inc.
“So it was a affair amid the admiral of Northern and Richard Benda,” said Bollen, who did not accommodate a date for the affair or say who was the admiral of NSU at the time (from 2008 to 2009, the university transitioned through three presidents). “They absitively that I should go clandestine and do it beneath arrangement with the governor’s office.”
An acceding to that aftereffect amid the Governor’s Appointment of Economic Development and Bollen’s SDRC Inc. was active in backward 2009. Bollen additionally larboard accompaniment application at that time to run SDRC Inc.
“GOED knew what was happening. Northern knew what was happening. Board of Regents knew what was happening,” Bollen said. “That was their decision.”
To that point, fees calm as allotment of the EB-5 affairs had benefited NSU, Bollen said. Those fees again flowed to SDRC Inc. in amounts not absolutely appear in the deposition. Bollen said he and business accomplice Pyush Patel took distributions from SDRC Inc. as stockholders in the company.
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