PIERRE, S.D. – A lawsuit has been field against three hog farms in Yankton County, South Dakota and a receiver has been appointed by a federal judge.
The suit, brought by Compeer Financial, requested the court appoint a receiver to oversee the raising and finishing of 110,000 hogs along with compensation for the “millions of dollars fraudulently transferred by the defendants and their principals between Canada and the United States” in a check kiting scheme.
Compeer Financial, Sun Prairie, WI, is a member-owned, Farm Credit cooperative serving and supporting agriculture and rural communities.
In a complaint filed March 24, 2025, in 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, there are now reported losses of $36 million.
The bank claims the scheme created an illusion of substantial funds, but once the bank stopped honoring checks, losses mounted.
Sunterra Farms is the parent-company to a pig operation in South Dakota. It has offices in Beresford and pig barns in the Yankton area. It finances operations through loans with two banks: Compeer and CWB.
Compeer alleges that Sunterra drew checks on one subsidiary’s account and then deposited them in another with neither having substantial funds. Compeer said this allowed Sunterra to avoid overdraft fees earn interest on falsely inflated account balances.
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. It has also received funding from the South Dakota Governor’s Office of Economic Development in the past.
Since Compeer is the only available source of funding for the care and feeding of the pigs, the financial institute told the court, “a receiver is urgently needed to facilitate the continued care of these animals.”
Schulte ruled in favor of a receiver being instituted. In his written opinion, he said the Sunterra-owned companies “expressly consented to a receiver in the event of a default” on their loans.
He looked to South Dakota statute and precedent to help him conclude. In state statute, receivers can be put in place when a “corporation is insolvent or is in imminent danger of insolvency.”
U.S. District Court Judge Eric Schulte said he believes the situation warrants that. He added that “appointing a receiver will do more good than harm.”
All three parties agreed on Pipestone Management as a good, neutral third-party for the receiver.
Pipestone is granted the ability to “execute any consent to disclose information” for Sunterra in relation to the allegations of check kiting.
The receiver agreement included specific protections for TPG and Tyson’s pigs. All the pigs will go under the direction of the receiver, but funds to maintain TPG pigs will not go towards Sunterra’s debts owed to Compeer.
Any other action needs express written approval from Tyson or TPG.
Pipestone is also helping run the day-to-day business operations of the Sunterra-owned companies.
Judge Schulte said the receiver is temporary, and he wants more information within 60 days.
As for compensation, Compeer claims it is now entitled to judgment of $14.0 million against Sunwold, $18.9 million against Sunterra and $2.3 million against Lariagra, plus all unpaid interest and late charges accrued after March 7, as well as all reasonable attorneys’ fees and legal expenses.
