“Today’s settlement and the recovery of $1.5 million form SDRC Inc. not only compensates the state for past EB-5 related expenses, but also ensures the state has the funds it would otherwise have had under the contract with SDRC Inc. to guard against any future claims,” said Tony Venhuizen, Gov. Dennis Daugaard’s chief of staff, in a statement.
The lawsuits stem from the scandal over management of the EB-5 program in South Dakota. The federal EB-5 program allows wealthy foreign investors to acquire green cards to the United States for investing $500,000 in qualifying projects that increase economic development in rural or impoverished areas of the United States.
Under former Gov. Mike Rounds, the EB-5 program was run through the Department of Tourism and State Development by a state employee namedJoop Bollen. In 2009, Bollen quit his job with the state and signed a contract with the state to manage EB-5 projects through his company, SDRC. In 2011, the former head of Tourism and State Development, Richard Benda, went to work for Bollen and SDRC.