South Dakota Public Utilities Commission issues cease-and-desist against Banghart Properties

South Dakota Public Utilities Commission hits Banghart Properties LLC, with cease-and-desist on grain trades.

A man with a stubble beard stands in a Superman shirt.
Lawyers for Jeremey Frost, grain marketing adviser from the Onida, South Dakota, and his mother's Banghart Properties LLC grain business where he works, say the company is cooperating with a cease-and-desist order by the South Dakota Public Utilities Commission, but will defend against a $70,000 recommended fine for trading above its Class B license. Banghart is also appealing a $290,000 fine in Nebraska, and Frost is also involved in federal suits with Indigo Ag Inc. in Tennessee. Photo taken March 2021, Onida, South Dakota.
Mikkel Pates / Agweek

PIERRE, South Dakota — South Dakota Public Utilities Commission staff has issued a cease-and-desist order against Banghart Properties LLC, of Gettysburg, South Dakota, for trading grain at levels far exceeding its licensed limits.

A man in a suit
Jeremey Frost is the owner of Fearless Grain Marketing LLC, of Onida, South Dakota. Photo circa 2020.
Courtesy / Fearless Grain Marketing

A South Dakota PUC staff lawyer on Jan. 30, 2023, recommended the Commission impose $70,000 in fines, block executives from getting future licenses, and refer the case for criminal charges.

The PUC staff alleges the company purchased grain far in excess of its Class B licenses in 2022 and 2023.

If the fines are ordered as requested, they would include the maximum of $20,000 for 2022 violations, plus the maximum of $50,000 for 2023. No hearing date is set.

Mother and son

Banghart Properties LLC was registered with the state of South Dakota June 22, 2018, and is owned by Janice K. Banghart. Banghart’s son, Jeremey Frost, continued as a trader with the company. Banghart had previously worked for Frost in his companies that were called Fearless Grain Marketing Storage & Arbitrage, Fearless Grain Marketing, and Fearless Grain. Those companies are involved in separate legal quagmires. (Frost, in his marketing is known for his fondness for “Superman” cartoon imagery and clothing.)


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Attorney Robert T. Konrad, of Pierre, South Dakota, representing Banghart (and Frost in separate matters) told Agweek that “nothing has been determined yet” and noted the complaint itself doesn’t establish a violation.

“I think there has been on some level a misunderstanding,” Konrad said. “I think there’s a good faith misunderstanding on a couple of things.”

Konrad underlined that his client has not received a “complaint from any producer,” and noted that no one has alleged that “any producer has been harmed.” Banghart is complying with the cease-and-desist order but will make its case in future hearings that the company is “striving to achieve compliance.”

South Dakota PUC Staff Attorney Amanda M. Reiss, in the document, alleged 184 violation instances in 2022 and 130 violations in 2023. State law on July 1, 2022, changed to $1,000 per instance to $5,000 per instance, and the annual fiscal year maximum changed from $20,000 to $50,000.

The staff also asked the Commission to refer the case for criminal charges based on the total of 314 violations, and for “at least two instances of making false or misleading statements” to the Commission.

Bar future licenses?

Reiss said staff also wants the Commission to deny future grain licenses to Banghart “and to any entity where any owner, manager, or chief executive officer of Banghart would be serving as an owner, manager, or chief executive officer of such an applicant.”

Banghart had a “Class B” license, effective through June 30, 2022. A Class B license limits grain trades to no more than $5 million. The PUC staff said Banghart was well aware of the limits because Banghart had unsuccessfully applied for a Class A license and was denied on June 2, 2022, on grounds they didn’t meet the financial requirements. So Banghart was operating under a Class B license.

According to South Dakota rules, a Class A license means a company has to have $100,000 equity and positive working capital. A Class B license simply requires a positive equity and working capital. Frost told Agweek that the reason for the Class A denial was a separate $290,000 penalty by the Nebraska Public Service Commission, which the company is still appealing.


The Class B bond is $50,000, theoretically to help compensate clients in company insolvencies, although those could be in the millions. The Class A bonds are based on three-year average purchases. Frost, reached Jan. 31, 2023, told Agweek that Banghart had bonds for trading $10 million to $20 million, even though the Class A license was denied.

Exceeding limits

According to the complaint, on Jan. 9, 2023, the South Dakota PUC staff inspected the company’s records and learned that the company had traded a total of $16 million since the license was established, and had traded more than the maximum $5 million in both 2022 and 2023.

The staff said the Banghart trades were “egregious” for “a number of reasons." First, the number of transactions and amounts above the maximum over two time periods “indicates this was a willful violation of law” and showed a “blatant disregard” for the limits.

Separately, Banghart continues to appeal the Nebraska penalty, imposed in 2022, because the company in 2021 bought and sold grain in that state without proper licensure. The last of the briefs and responses were filed Jan. 17, 2023. The case remains under appeal and is being handled by the Nebraska Attorney General’s office.

Also separately, Frost is still in a legal contest with Indigo Ag Inc. over grain trading authorities from transactions in 2020. That matter is in federal court in Tennessee, with suits and counter-suits.

Mikkel Pates is an agricultural journalist, creating print, online and television stories for Agweek magazine and Agweek TV.
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