Iowa axes $2.5M grant for energy firm’s Menlo plant
May 8th, 2012 by Ric Hanson
IOWA CITY, Iowa (AP) — Iowa officials have canceled a $2.5 million grant for a firm proposing a technology to make fertilizer from corn cobs at a plant near Menlo. A spokeswoman for Iowa’s economic development agency said Tuesday that SynGest, Inc. defaulted on its contract by not disclosing in its 2009 application that Chairman Serge Randhava had been sued for racketeering and fraud.
The agency released a copy of the default notice to The Associated Press, which reported on the lawsuit last month. The case was settled in 2009 along with another lawsuit in which Randhava was part of an investor group that accused others of fraud and racketeering. SynGest answered “no” to a question asking whether there were “any judgments or court actions completed or pending” against officers. SynGest CEO Jack Oswald says the cancellation “appears to be a knee-jerk reaction” and the company hopes to convince the state to change its mind and resume the grant funding. Randhava declined comment.