Missouri Attorney General Chris Koster said Thursday that his office has opened an investigation into the financial collapse�of a Chinese-owned sweetener plant in Moberly.
"Substantial concerns have arisen regarding the entity known as Mamtek International Limited and its proposed construction and operation of a manufacturing facility in Moberly, Missouri," Koster said in a written statement.
He said that his office is collaborating with local authorities and looking into the possibility of criminal charges.
"The Attorney General's Office is assisting Prosecuting Attorney Mike Fusselman and the Randolph County Prosecuting Attorney's Office in reviewing this matter to determine whether any violations of Missouri civil or criminal laws have occurred," Koster said.
Mamtek USA, a division of Mamtek International Ltd.,��has laid off employees hired in Missouri and halted�its work on the plant, which had been heralded by public officials as an example of how foreign Chinese investment could bring new life to a depressed area.
Mamtek, a Hong Kong-based company with both U.S. and Chinese ownership, missed its first $2.2 million payment on city-backed bonds in August, which went public Sept. 1.
The Sweet O plant on the edge of Moberly�is only half built. Gov. Jay Nixon and other state and local�officials had proclaimed last year that the $46 million project would make�high-grade artificial sweetener by the truckload and pay good wages to hundreds of�workers in the old railroad town 30 miles north of Columbia.
Late Thursday, Standard & Poors dramatically downgraded the bonds that the central Missouri town�issued to pay for the sweetener plant. The credit rating agency lowered its rating on the bonds to CC from A-minus.
Moberly had guaranteed $39 million in bonds to get the plant built, and could be on the hook for the company's bad debt.
Janet Morales, editor and publisher of the former�weekly The Moberly Mirror, suggested that city and state officials failed to do their homework in vetting the company. While Mamtek�said it has a plant in Fujian Province, China, she could find no evidence of one. She also�contacted trade publications and competitors, and found no one�knew of Mamtek.�
Mamtek has told UMB Bank, which�issued the bonds, that it's�close to broke and would need�an additional $20 million to $44.5 million to finish the project.
The state of Missouri had pledged $14.4 million in tax credits to Mamtek. But despite the collapse, state officials say that Missouri taxpayers will not lose a dime. Because the company never created any jobs here, Mamtek never received any tax credits.
Peter Kravitz, a Los Angeles bankruptcy attorney and the new president of Mamtek, could not be reached for comment.
Source: http://www.stltoday.com/business/local/35840376-e618-11e0-b283-001a4bcf6878.html
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