The St. Croix Band of Chippewa Indians, operators of St. Croix Casino at Turtle Lake, have been fined $5.5 million by the National Indian Gaming Commission as a penalty for alleged misappropriation of funds announced April 11.
In an eight-page statement dated May 9, National Indian Gaming Commission chairman Jonodev O. Chaudhuri announced his agency would levy fines in connection with each of five violations detailed in the original report, released April 11 in a “finding of violation.”
“There are few violations more serious than abusing the trust of the electorate for personal gain,” he said in a concluding statement.
In defense of his reasoning behind the ruling, Chaudhuri said “the misuse of gaming revenue resulted in a considerable economic loss to the tribe. Money ($1.5 million) that could and should have been used to fund governmental and tribal programs was diverted … to fill the pockets of a few individuals.”
Chaudhuri noted that tribal officials, in an April 29 response, had appealed to the commission based on the tribe’s poor economic status.
“I will take the tribe at its word that its current financial situation is … precarious,” he said.
But, in a sense, tribal officials had only themselves to blame, he added.
“This (situation might) not be the case but for the misappropriations of net gaming revenue committed by council members and gaming commissioners,” Chaudhuri wrote.
Making matters worse is that the misappropriations “were directed by the very people charged with protecting (tribal) resources.”
In the meantime, “I see no serious efforts to deal with the root problem that caused these violations,” Chaudhuri wrote.
Tribal gaming has grown into a $32 billion annual industry because “it has rightfully cultivated a reputation as a well-run, well-regulated industry,” Chaudhuri added. A violation such as this one “does immeasurable damage to the industry,” he said.
The April 29 response “reflects steps the tribe has taken to strengthen regulation and prevent misuses of gaming resources,” Chaudhuri wrote. “It is, however, a startling revelation of the tribal officials’ refusal to accept responsibility for the violations or correct the conditions that allowed them to occur.”
The finding of violation detailed alleged misappropriations that include:
• Personal loans that weren’t reviewed by the tribal council.
• Unsubstantiated purchases of supplies.
• More than $300,000 in unsupported and/or undocumented “consulting fees.”
• “Travel expenses” that were either issued in advance of a council member’s trip or that weren’t accompanied by supporting evidence such as receipts or invoices.
• Disbursement to pay for Christmas parties in the home communities of council members.
• Payments to tribal elders to “assist with tax problems.”
• A disbursement to pay the tuition of a tribal council’s relative to Ohio State University.
• “Direct payments” to seven tribal members that total more than half a million dollars.