Compeer Financial has filed a lawsuit against three hog farms in Yankton County, South Dakota this week, requesting the court appoint a receiver to oversee the raising and finishing of 110,000 hogs and compensation for the “billions of dollars fraudulently transferred by the defendants and their principals between Canada and the United States” in a check kiting scheme.
In a complaint filed Monday in the South Dakota District Court, the member-owned Farm Credit cooperative stated the defendants, Sunwold Farms, Sunterra Farms and Lariagra Farms, pledged their pig inventory as the primary collateral for a $11.5 million loan. However, due to the farms’ fraudulent check kiting actions, Compeer is now facing losses of $36 million
Check kiting involves opening one or more accounts in several banks and then drawing from one account and depositing in the other when neither has any substantial funds. The scheme will collapse when one of the banks rejects a check drawn upon “uncollected funds.”
Sunterra Group, a multi-state and international swine operation involving several generations of the Price family based in Alberta, Canada, is the Canadian umbrella entity involved with all three defendants. Sunterra is an Iowa corporation owned by Sunterra Enterprises and manages approximately 500,000 pigs spaces for Sunwold, Lariagra and various other entities. Sunwold is a South Dakota corporation owned by Sunterra Enterprises and finishes just over 62,000 pigs. Lariagra is also a South Dakota corporation owned by Sunterra Enterprises and finishes out approximately 48,725 pigs.
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