Palin appointee under federal indictment. Methinks somebody's milk just went sour.

Courtesy of ADN:

 A 57-year-old Wasilla woman has been indicted by a federal grand jury on charges she defrauded the state of Alaska and lied to the U.S. Department of Agriculture during the operation of the now-defunct Matanuska Creamery. 

The indictment also charges Valley Dairy CEO and investor Karen B. Olson with concealing the alleged criminal conduct of the former dairy manager, Kyle Beus. 

A grand jury in December indicted Beus on charges he misused federal grant money, and he awaits trial. 

The charges against Olson allege she fraudulently obtained a $430,000 state agriculture department loan to keep the Valley Dairy afloat by concealing its finances. The indictment also said she submitted false documents to convince the USDA in 2008 to waive its prohibition on using dairy and ice cream-making equipment at Valley Dairy as collateral on state loans. The equipment was purchased in 2007 using federal grants that didn’t allow the equipment to be sold or encumbered without special authorization from the USDA. 

Alaska Dispatch has more here:  

By the mid-1980s, Mat Maid was faltering, and a state-run corporation took over management. It struggled until Sarah Palin became Alaska's governor. She arrived on the scene shortly before the state Board of Agriculture and Conservation, which had watched the dairy bleed cash for years, voted to deny it further loans. 

With that move threatening to kill the dairy, Palin fired the board and appointed another, which voted to give the dairy more money. That went on until the new board realized, as did the old board, the dairy just couldn't compete in the real world of modern-day Alaska with cheaper milk shipped in from the Lower 48. 

Enter Beus, then a Valley dairy farmer, and Bob Havemeister, another dairy farmer. They formed a joint venture to take over the equipment and operations of Mat Maid in an effort to keep it alive. Beus was the one who eventually ended up with most of the equipment and set up a company called Klondike Creamery and Candy, which briefly marketed ice cream in Alaska. 

It was not long, however, before it was rolled into Valley Dairy -- a joint effort of Beus, Robert Wells and Olson. Olson was the former Alaska state executive director of the U.S. Department of Agriculture Farm Service Agency, a job she held from 1993 to 2001. 

Olson has insisted in a number of interviews with Alaska Dispatch that the only interest she ever had was trying to keep the dairy business alive in Alaska. After she joined Beus at Valley Dairy, the company began efforts to tap a $5-million pool of USDA money set aside for rural development. 

Beus was indicted last year on charges he took at least $120,000 of that money for his own "personal and discretionary use." Where and when Olson learned of his alleged activities is not explained in the indictment against her, but it says she devised a scheme "to conceal the true nature of the Valley Dairy finances and the fraudulent activity of Beus, and to obtain a loan from the ARLF (Alaska Revolving Loan Fund) to keep the Valley Dairy, of which Olson was an investor and employee, operating." 

As many of you undoubtedly know there was a rather suspicious fire that burned the old Matanuska Maid Creamery to the ground. (I know, right?)

If you are new to this particular Palin scandal there is no better place to catch up then over at Andrew Halcro's now defunct blog.

Now some are suggesting that THIS might finally be the straw that snaps the back of Palin's uncanny ability to avoid incarceration. However I would not count my eggs TOO quickly, because while it seems that Olsen has every reason to reduce her sentence by ratting out her old boss, Palin has somehow slipped through the grasping fingers of the Feds a few times before.

So let's stay tuned and see how this plays itself out.