WEDC writes off $1.1 million loan to convicted De Pere businessman
The Wisconsin Economic Development Corp. has written off a $1.1 million loan to a jailed De Pere businessman who was convicted last year of bank fraud and faces additional charges for allegedly defrauding the state’s job-creation agency.
Last week a federal judge ordered Green Box NA Green Bay owner Ron Van Den Heuvel be sent to jail after a federal prosecutor presented evidence that he was continuing to defraud investors and live a lavish lifestyle, even while failing to repay creditors and requesting the assistance of a public defender. In the filing, U.S. Attorney Matthew Krueger called Van Den Heuvel “a persistent, unrepentant fraudster.”
Van Den Heuvel was sentenced on Jan. 5 to three years of prison and ordered to pay $316,445.47 for defrauding Horicon Bank of more than $700,000 starting in 2008. He is appealing that case.
He was allowed to remain out of prison while he faces 14 separate federal counts for allegedly defrauding WEDC and other investors of more than $9 million. A trial in that case is scheduled to begin Nov. 13.
WEDC’s 2011 loan to Green Box was one of several problematic deals from WEDC’s early years that gained attention after a 2015 Wisconsin State Journal report on a separate failed $500,000 loan to Building Committee Inc. that was later written off.
WEDC’s uncollectable loan balance grew from $1.3 million in December 2014 to $11 million as of December 2016, according to the most recent Legislative Audit Bureau review of the agency.
Democrats pounced on the Green Box write-off as a sign of financial mismanagement under an agency Gov. Scott Walker created in 2011 to spur job growth. Senate Minority Leader Jennifer Shilling, D-La Crosse, said the write-off raises concerns that the agency won’t be able to enforce the terms of its $3 billion tax credit deal with Foxconn Technology Group, which is building a $10 billion manufacturing campus in Racine County.
“This was a bad loan that should have never been awarded in the first place,” Shilling said. “Despite repeated promises to recoup financial losses and correct these glaring problems, Gov. Walker is letting a convicted con artist off the hook for money that is legally owed to taxpayers.”
WEDC spokesman Mark Maley said the decision to write off the debt was made “because there is little likelihood of collection on this debt.” He noted the loan has been fully reserved on WEDC’s books since April 2016.
“The write-off does not prevent WEDC from collecting on assets discovered, which is why WEDC continues to pursue Van Den Heuvel’s guaranty,” Maley said. He also noted the loan was made in September 2011 before several safeguards were put in place at the agency to prevent a repeat.
Also Wednesday, the agency said it has forgiven a $2.5 million 2007 state loan to Kerry Inc. after the company’s Beloit expansion created 800 jobs, more than three times the number it had promised. However, the move comes after a Kerry subsidiary purchased and closed a Foremost Farms facility in Rothschild in March, laying off 110 employees.
Maley referred to a Kerry statement from March that the company intended to hire back an unknown number of those who had been laid off from Foremost.