BROOKINGS, S.D. — An investor in a troubled project to grow produce and seafood near Brookings says he hasn’t been able to get basic information about the venture’s finances.
Investor Dan Kondziolka of Brookings told the Argus Leader that he received two “grandiose” letters with little specifics and no timeline from Sioux Falls-based Global Aquaponics since investing $50,000 for two ownership units last fall. Kondziolka, a professional accountant, said he asked for balance sheets and other documentation about the project’s finances but got none.
“I’m getting rumors that things are looking corrupt and there might not be any money available,” Kondziolka said.
A series of news reports from KELO-TV and the Argus leader have raised questions about the company’s legitimacy. Global Aquaponics has said that the system would produce 2.5 million pounds of food a year and that construction would start in spring 2017, but the newspaper reported that work on the facility hasn’t started.
Timothy Burns, former chief operating officer for Global Aquaponics, told the Argus Leader that construction projects are often delayed. But Burns, of Brookings, said that he was recently interviewed by the FBI about the company’s project. The agency has declined to comment to The Associated Press.
A private equity offering that the company used to attract investors called for raising roughly $5.3 million through the sale of 215 ownership units.
A former Global Aquaponics employee filed a lawsuit Tuesday against the company, calling it a “sham corporation.” Gregg Selberg is seeking hundreds of thousands of dollars in damages.
The lawsuit claims Selberg was misled about Global Aquaponics’ fraudulent activities, which he says tarnished his reputation and “devastated” his economic position. The lawsuit filed in Brookings County also names Burns and company majority owner Tobias Ritesman, who dubbed himself “the tiger” on a company website and promotes himself as a maverick entrepreneur.
But an entrepreneurial accolade that Ritesman has claimed he won in 2016 doesn’t exist, the newspaper reported . Two men purported to be members of a panel of judges for the Global University Alliance’s “Entrepreneur of the Year Award” said they’ve never heard of Ritesman or the award. The alliance’s website says the award has been given to entrepreneurs including Ritesman and the founders of Apple, Facebook, Google and Ikea.
Global Aquaponics announced this month that it’s working on a new development timeline for the proposed multimillion-dollar venture after funding and contracting issues. That came after a curious transaction in which lobbyist and former legislator Dean Krogman traded a Brookings home valued at about $175,000 for a 10-acre parcel that he then gave for $1 to the company behind the project in May.
That company, SD Food Security LLC, which was organized by Ritesman, is listed as “delinquent” in secretary of state’s office records. The Argus Leader hasn’t been able to establish how Krogman is tied to the company or why he helped.
Krogman and Global Aquaponics haven’t returned telephone messages this week requesting comment from The AP.
Information from: Argus Leader, http://www.argusleader.com