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Federal Fraud Charges Against Valley Dairy Co-Owner

By | August 26, 2013 - 6:16 pm

 Karen Olson, who managed the Matanuska Creamery in Palmer, has been charged with defrauding the state of Alaska and with making false statements to the federal Department of Agriculture. Olson faces six counts in all.

The charges stem from 2008, when Olson, CEO and a part owner of Valley Dairy, illegally obtained a 430 thousand dollar loan from the state’s division of agriculture. The charges indicate that Olson used the loan to conceal Valley Dairy’s financial losses, and that she made false statements to the US Department of Agriculture in order to receive federal grants.

Federal prosecutor Retta Randall says Olson’s scheme aimed at covering up illegal conduct on the part of her business partner

“Once she realized the economic situation of the Valley Dairy, she was made the chief executive officer of the Valley Dairy and authorized to pursue loans with the state of Alaska. What our investigation revealed is that she allegedly filed false documents by fax and by email and by mail to get the state of Alaska loans.”

Olsen is charged with concealing the criminal activities of Kyle Beus [BEE yoose], co owner and president of Valley Dairy. Beus is currently under indictment himself for using USDA grant money for his personal use, and for submitting false statements to the USDA regarding two federal grants awarded him in 2007 and 2008 to start a cheese and ice cream manufacturing facility in the Matanuska Valley. Retta Randall

“She provided documents to USDA. Those documents were also false, but she was able to get the USDA to consent to give over to the state the primary interest in the equipment. And that’s what caused the state then to authorize the loans. So the underlying allegations are based on false documents, concealing the criminal conduct of Mr. Beus, and then getting loans from the state of Alaska and having the USDA give up it’s interest in the dairy, for the Valley Dairy to be able to get those loans. “

Beus is awaiting trial. Federal prosecutors say that Olson could face a one million dollar fine or a total sentence of 30 years in prison.

Cori Mills, a state assistant attorney general in Juneau, says it is not clear at this time what action the state will take against Olson

“It’s all confidential and will all be done internally. And if and when that decision is made, then it will be made public. But at this point, there is no decision on pressing charges.”

The Matanuska Creamery shut down in December of last year, due to financial issues. The company owed the state almost 900 thousand dollars when it closed. The state recalled it’s agricultural loan to Valley Dairy in August of last year after the Creamery defaulted on the debt. The state acquired the Creamery’s assets and auctioned them off earlier this year.

 

 

 

 

 

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