News Summary: Sweetener CEO faces charges
SWEET INCENTIVES: The north-central Missouri town of Moberly issued $39 million in bonds in July 2010 to finance the construction of an artificial sweetener facility by Mamtek U.S. The state also authorized up to $17 million of incentives, which never ultimately got paid. Construction on the facility halted after Mamtek missed a bond payment in August 2011.
CRIMINAL CHARGES: Missouri Attorney General Chris Koster on Tuesday charged Mamtek CEO and Chairman Bruce Cole with theft for diverting bond funds to his personal use to save his home in Beverly Hills, Calif., from foreclosure. Cole also was charged with four counts of securities fraud for not being truthful about the operations of his troubled company.
FINANCIAL CONSEQUENCES: Moberly defaulted on its bonds and was unable to find a company willing to take over the partially completed Mamtek facility. UMB Bank, the trustee for bondholders, filed a lawsuit against Mamtek in federal bankruptcy court. On Oct. 24, Mamtek's equipment and other assets are to go on sale at a public auction.