A Green Bay-area businessman has been indicted on federal charges for allegedly defrauding the state’s job-creation agency of more than $1 million, U.S. Attorney Gregory Haanstad announced Wednesday.
The indictment of Ron Van Den Heuvel, owner of Green Box NA, for alleged fraud and money laundering marks the first time criminal charges have been leveled against a business owner who received taxpayer funding from the Wisconsin Economic Development Corp.
According to the indictment filed in federal court Tuesday, Van Den Heuvel allegedly devised a scheme that ended up defrauding $9 million from WEDC, acquaintances and investors from Canada and China between 2011 and 2015.
WEDC loaned $1.12 million to Green Box on Oct. 21, 2011, according to the indictment. The funds were supposed to help the company create 116 jobs by December 2014 as part of a more than $13 million project to turn fast-food wrappers and other waste paper into synthetic fuel and paper products while producing zero waste, according to agency records.
Van Den Heuvel persuaded WEDC and other investors to give him money by falsely claiming he had entered into agreements with major companies to advance Green Box’s operations and produced false financial statements that grossly inflated his personal wealth and financial situation, the indictment said.
A phone number for Van Den Heuvel has been disconnected.
The money he received from investors and WEDC to further Green Box’s operations was instead used to pay personal expenses, creditors, other legal obligations unrelated to Green Box and on promotional material to “further promote the scheme,” according to the indictment.
Van Den Heuvel also told WEDC he hadn’t faced any lawsuits in the previous five years. Green Box also just recently emerged from bankruptcy.
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According to warrants issued in 2015, “a substantial portion” of the loan amount from WEDC was transferred to bank accounts for other business entities and used to pay Van Den Heuvel’s personal and business debts unrelated to Green Box.
The warrants also alleged that Van Den Heuvel gave tours of a vacant building in Ashwaubenon that “was never for sale but was used as a prop” to induce commitments from investors.
He also gave demonstrations of his equipment, but it did not work as he represented, and he claimed to hold seven patents “when, in fact, he holds none,” according to the warrants.
One employee told investigators she was instructed to document financial entries on a balance sheet with numbers Van Den Heuvel quoted to her, but “she knew the numbers were not real because there was no actual business or product being produced by Green Box” at any time.
An investigator for the Brown County Sheriff’s Office testified at the time that Van Den Heuvel used the money to pay off personal and business debts, such as Green Bay Packers box seats, trips to Las Vegas and $2,000 weekly alimony payments to his ex-wife.
The false information also persuaded WEDC to provide Green Box a $95,500 grant for job training, according to the indictment.
Van Den Heuvel also allegedly defrauded $4.5 million from investors from China through a federal program that allows immigrant investors to become permanent citizens by investing in projects approved by the United States Citizenship and Immigration Services agency. None of the projects has been approved by the agency, according to the indictment.
In a January 2016 interview with the Wisconsin State Journal, Van Den Heuvel promised to repay WEDC but hadn’t been able to because a judge had put his company into receivership, as other creditors were owed money first.
Agency spokesman Mark Maley said Wednesday that Van Den Heuvel had not repaid WEDC yet.
“As stewards of taxpayers’ dollars in making those investments, it is important to us that any potential abuse of state funds related to WEDC awards be thoroughly investigated. WEDC has been cooperating with federal authorities in their investigation of Green Box and Ron Van Den Heuvel, and will continue to do so as the case evolves,” Maley said. “WEDC also continues to participate in litigation to recoup repayment of Green Box’s WEDC loan to whatever extent possible.”