by John J. Fialka
Staff Reporter of The Wall Street Journal
The Wall Street Journal
WASHINGTON — A federal district judge ordered Interior Secretary Gale
Norton to stand trial next week on charges that she acted in contempt of
court for allegedly filing false information regarding efforts to overhaul a
$500 million trust fund. The Interior Department manages the fund as a
banking system for individual Indians, with income derived from use of their
land.
Judge Royce C. Lamberth said the contempt allegations also apply to
Assistant Interior Secretary for Indian Affairs Neal McCaleb, who also is to
stand trial. The judge’s action follows reports by court-appointed monitors
asserting that under Ms. Norton, the department has made little progress in
replacing a faulty accounting system that Indian plaintiffs in the
class-action lawsuit say has cost billions in lost assets.
If she is found in contempt, Secretary Norton will be the third cabinet
official to face the wrath of Judge Lamberth. In October 1999, he found two
Clinton administration officials, Interior Secretary Bruce Babbitt and
Treasury Secretary Robert Rubin, to be in contempt in the case, which was
initiated in 1996.
The Interior Department had no immediate response to the judge’s order for a
contempt trial, scheduled to begin Monday.
Last month, Secretary Norton attempted to mollify the judge by establishing
a new office to oversee the trust-fund accounts, which were managed by the
Bureau of Indian Affairs, although the money is held by the Treasury
Department. The accounts are part of a banking system established by
Congress in the 19th century for Indian reservations that had no banks. The
accounts hold and disburse income for about 300,000 Indians annually.
In his order, Judge Lamberth suggested Secretary Norton may be on difficult
legal ground because her lawyers missed deadlines to contest three reports
made by a court-appointed monitor that charged, among other things, that the
department’s descriptions of its efforts to set up a computerized accounting
system were exaggerated and misleading.
Dennis M. Gingold, lead attorney for the Indians, said the judge’s action
“demonstrates that the secretary of interior is unfit to remain as trustee
for the individual Indian trust accounts.” If she is held in contempt, he
said, Judge Lamberth should put the trust funds under a court-appointed
receiver until the case is settled.
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