09-04-2025
Receiver seeks access to ‘missing' financial data amid check-kiting claims
(Photo by Kent Becker, U.S. Geological Survey)
A financially troubled Iowa company is operating under a court order to show it did not attempt to destroy or manipulate financial data sought by a court-appointed receiver.
In March, the Iowa-incorporated company Sunterra Farms Iowa, and its affiliates, Sunwold Farms Inc., and Lariagra Farms South Inc. were accused in U.S. District Court by one their lenders, Compeer Financial, of operating a billion-dollar check-kiting scheme.
Compeer Financial is suing the three companies, which are run by the Price family of Yankton County, South Dakota. The companies are responsible for extensive swine operations in Iowa and South Dakota, with their parent companies based in Canada.
At Compeer's request, a federal judge has appointed a receiver, Hannah Walkes of Pipestone Management II, to take control of the companies' operations and ensure that Compeer's collateral – 110,000 head of swine located in 54 barns in and around Yankton County – are fed and cared for. Walkes told the Iowa Capital Dispatch on Wednesday the pigs, which are destined for slaughter, are being properly cared for and are no longer at risk.
The swine — which are in various stages of growth and are owned by either Sunterra or Lariagra — are among 500,000 hogs managed by Sunterra Farms Iowa.
In its lawsuit, Compeer claims that the Price family companies have engaged in a 'long-running fraud' that involves check-kiting — a fraudulent practice in which a company draws checks from one bank account for deposit in another bank account that it controls, when neither account has sufficient funds to cover the checks. The process takes advantage of the delays in processing checks between banks, allowing one account or another to continually show credits for funds that have yet to be collected.
Compeer alleges the transactions have had the effect of creating phony positive account balances that caused Compeer to pay the companies interest. Compeer claims that before the check-kiting scheme collapsed in February, it involved 'billions of dollars' in fraudulent transactions between accounts with Compeer and Canadian Western Bank.
According to separate court filings by Canadian Western Bank in the Court of King's Bench in Alberta, the 'core guiding minds' of the defendant companies are CEO Ray Price, along with Douglas, Glen, David and Art Price — all of whom are directors and shareholders of various members of the Sunterra group of companies.
According to the Canadian bank, the Price companies issued checks that vastly exceeded their actual holdings — meaning none of the companies, at any point, had the actual cash on hand to pay the face value of the checks. The total amount of money circulated as a result of the alleged check-kiting scheme over a nine-month period exceeded 7 billion Canadian dollars, or 4.9 billion American dollars, the bank claims.
In Canadian court filings, Canadian Western Bank alleges that at a meeting on Feb. 24, 2025, Art and Glen Price 'made various clear and unequivocal statements' indicating the overdrafts were caused by CEO Ray Price, with whom they were 'upset and disappointed.'
Not long after that meeting, however, the Price family allegedly refused to allow Compeer and the Canadian bank to share information as they investigated the matter.
While case in Canadian court has advanced, conflicts have arisen in the U.S. District Court proceedings involving Walkes, the newly appointed receiver tasked with taking control of the Price family companies.
According to documents filed with the court by Walkes, she went to the Sunterra Farms Iowa offices in Beresford, South Dakota, on the morning of March 31 to gather financial information. She alleges that while she was logged onto Sunterra's online accounting platform, she noticed 'all information regarding accounts receivable, accounts payable and general ledger were missing.'
A short time later, she told the court, she received 'a message that we had been entirely kicked out of the accounting platform.' After logging back in, she alleged, she discovered that information — including data she had previously accessed — was missing.
'I have serious concerns that the data is being destroyed or manipulated,' Walkes told the court, asking that the Price family companies be required to show cause as to why they shouldn't be held in contempt of court.
Court records show an attorney for Walkes sent an email to Sunterra's lawyers, stating, 'Someone knew that the receiver was on site and reviewing accounting information, and information and data started disappearing at the same time, which is a direct violation of the court's order.'
An attorney for the Price companies wrote back to Walkes' attorney, questioning those claims and asking, 'Will this type of aggression take place at every turn or will the receiver act in the best interest of all parties as it is required?'
Four days later, Walkes updated the court on the situation, indicating some of the issues had been resolved and that while she still didn't know whether some data had been removed, she believed she had gained access to enough information to manage the accounts for two of the three companies — Sunwold and Lariagra.
However, she told the court, with regard to Sunterra Farms, that company functions as the management entity for the other two, and after she attempted to run financial reports for Sunterra, they 'reflected all zeros. The Sunterra Farms journal entries were blank where financial information used to exist.'
In that same update to the court, she indicated that she had just learned the Sunterra information had been restored, but she still was unable to access information pertaining to the Price family's parent companies in Canada. Walkes asked the court to clarify her authority to gain access to that information.
In response, Sunterra and its affiliates argued Walkes had no 'permission to reach across the border into Canada to look at information not belonging to' the companies.
On Monday, U.S. District Judge Eric Schulte gave lawyers for Sunterra and its affiliates to until the end of day Wednesday to file 'an unequivocal declaration' that no evidence had been destroyed or manipulated.
As for the receiver's access to information on the Canadian parent companies, Schulte gave the companies' lawyers the same deadline to request a protective order that articulated the 'reasons why they believe such information should be protected from disclosure.'
