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Published March 28, 2013, 10:40 AM

SD elevator faces loss of licenses from insolvency

A Gregory, S.D., grain elevator from which a former employee allegedly embezzled thousands of dollars now faces a potential suspension of its grain buyer’s and warehouse licenses.

GREGORY, S.D. — A Gregory, S.D., grain elevator from which a former employee allegedly embezzled thousands of dollars now faces a potential suspension of its grain buyer’s and warehouse licenses.

The state Public Utilities Commission agenda for a meeting Friday in Pierre includes a petition from the PUC staff to suspend the licenses of Gregory Farmers Elevator Co.

The petition says that on or about Aug. 2, the PUC’s Grain Warehouse Division became aware that the elevator was operating with insufficient working capital. That timing falls within the period when Melissa Vosika, 29, of Gregory, allegedly embezzled more than $17,000 from the elevator between May and September, according to criminal charges filed against her in Gregory County.

The PUC petition includes a brief summary of the elevator’s financial situation but does not mention the alleged embezzlement.

Upon becoming aware of the elevator’s insufficient working capital, the petition says, PUC staff “immediately conducted a detailed inspection of the facility and books to determine if the risk to producers warranted an immediate suspension and began monitoring GFEC at that time.”

“Staff worked closely with the board and management of GFEC to ensure that they were not increasing the risk to producers while they worked to correct their working capital deficiencies.”

Wednesday, the petition says, PUC staff determined the elevator would be unable to obtain sufficient working capital to continue as a going concern.

“Staff has reason to believe that GFEC has outstanding checks for grain purchases to at least two producers that are not likely to be honored if presented for payment,” the petition says.

The petition asks the PUC’s three commissioners for immediate action to suspend the licenses.

“We are specifically aware of acts of insolvency and stress an immediate suspension of each license is the only way to prevent further potential damage to South Dakota producers,” the petition says.

The hearing on the petition is scheduled for 10 a.m. Friday in Room 413 at the Capitol in Pierre. James Mehlhaff, the PUC’s Grain Warehouse Division manager, will be available to testify.

Meanwhile, an arraignment scheduled for this week in the embezzlement case has been postponed to next month.

Vosika faces seven counts of embezzlement, one count of attempted embezzlement and three counts of altering corporate records. If convicted, she faces up to 10 years in prison and a $20,000 fine for each of those charges. She also faces up to five years in prison and a $10,000 fine for each of three counts of forgery against her.

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