Indians Want Receiver for Trust Fund
Contempt Charges Sought for Officials
The Washington Post
By: Bill Miller
Washington Post Staff Writer
October 22, 2001
Native Americans are asking a federal judge to strip the Interior Department of control of an Indian trust fund, contending that federal officials have failed to provide an accurate record of billions of dollars held for account-holders and have repeatedly lied to the court about their efforts to solve problems.
In the latest twist in a five-year court fight, Native Americans also are pushing U.S. District Judge Royce C. Lamberth to begin contempt-of-court proceedings against Interior Secretary Gale A. Norton, former Interior secretary Bruce Babbitt and 37 other current and former government managers and attorneys. They urged the judge to jail and fine the officials for allegedly misleading the court, and to put the trust fund under a court-appointed receiver.
“If it takes putting the secretary in jail for 15 minutes to get something to change, then I’m all for it,” said Dennis M. Gingold, a lawyer working with the Native American Rights Fund, which sued the government on behalf of 300,000 trust fund account-holders.
Interior spokeswoman Stephanie Hanna declined to comment on the Indians’ court requests, which were filed late Friday. She said officials had not seen the court papers, but remain committed to getting the trust accounts in order. Norton, who assumed office in January, has made Indian trust fund reform a top priority, Hanna said.
The dispute involves the handling of individual Indian trust accounts established more than 100 years ago to hold and disburse income generated for Native American beneficiaries for use of their land. The government is supposed to manage and pass along to Indians and their heirs royalties from the sale of petroleum, natural gas, timber and other natural resources.
The royalties generate about $500 million a year, and both sides agree record-keeping has long been in disarray. Many Indians rely on income from the accounts to cover everyday needs and expenses.
Lamberth ordered the Interior Department to repair the system in a December 1999 ruling accusing officials of “fiscal and governmental irresponsibility in its purest form.” Still to be determined is how much money is owed the account-holders for decades of lapses, with Native Americans saying up to $10 billion is at stake.
The judge had considered putting the trust fund into receivership in 1999, but said he would give the government one last chance to fix the system. At the time, he warned officials that they could be found in contempt of court if they didn’t deliver.
The latest developments came after a series of highly critical reports issued by a court-appointed monitor tracking the progress of reforms. In six months on the job, Joseph S. Kieffer III has submitted five court filings to the judge accusing Interior officials of covering up problems and an assortment of management failures.
Among other things, Kieffer said Norton and others provided progress reports to the judge that glossed over troubles in getting a new computer system up and running. Kieffer said his review found that the automated system is behind schedule and might never work. A recent progress report was given to the judge even though some agency managers refused to verify its contents, Kieffer said, adding that Justice Department lawyers, who represent Interior, must share responsibility.
Instead of admitting deficiencies, Kieffer wrote, Norton and other officials have repeatedly attempted to “avoid an honest presentation of the major management and systems problems that have delayed and hampered trust reform for years.”
He said Norton recently “verified an untruthful, inaccurate, and incomplete” progress report after Tom Slonaker, a special trustee in charge of trust reform, refused to do so.
In a court filing last Tuesday, Kieffer declared that the trust reform effort “is broken” and said the current leadership at the Interior Department may not be able to repair it.
“There is no one in charge of trust reform operations,” he said.
Kieffer’s statements were cited by Gingold and co-counsel Keith Harper in their bid to have Lamberth take quick action. They suggested Kieffer be named as the receiver and that he be permitted to name a management team at the government’s expense.
“The court monitor’s reports are a blueprint for receivership,” Harper said. “They’re a stunning indictment of the two Interior secretaries’ failures.”
He said the government has spent $614 million on trust reform and another $31 million to defend itself against the Indians’ lawsuit. Officials can’t provide an accurate accounting of funds now in the system, he said, let alone explain what happened in previous decades.
Despite past spending and promises, Harper said, “we have very little to show for the effort, and much of it is going to have to commence again.”
Lamberth has not set a date for a court hearing. In February 1999, he cited Babbitt, former Interior official Kevin Gover and Robert E. Rubin, who was then Treasury secretary, in contempt for failing to produce records despite numerous court orders.
| 
