The Mandan, Hidatsa, and Arikara Nation (MHA Nation) is currently embroiled in a lawsuit that alleges tribal leaders have engaged in financial improprieties and mismanagement of tribal wealth.
The lawsuit, filed in U.S. District Court, claims that the North Dakota tribe’s officials have spent millions of dollars without transparency, failing to release financial records or engage tribal members in decision-making processes regarding the spending of funds.
The lawsuit specifically highlights the tribe’s purchase of land in Las Vegas, totaling more than $115 million, without providing adequate financial disclosure to tribal members. It also accuses the tribe’s treasurer, Mervin Packineau, of failing to provide written records of receipts, expenditures, financial statements, or audits since at least 2009. Tribal members have been kept in the dark about the finances of the tribe’s 4 Bears Casino and Lodge, which have been discussed only in closed meetings.
Moreover, the lawsuit reveals that tribal officials have concealed financial records related to at least 26 for-profit enterprises and 17 not-for-profit organizations operated by the tribe. Financial accountability is further questioned as records show over $1.5 billion being withdrawn from a People’s Fund financed by non-renewable oil and gas revenues from 2010 to 2022. Despite this significant expenditure, no reports on the fund’s status or balance have been provided by Packineau.
“Throughout that duration, to Plaintiffs’ knowledge, Treasurer Packineau has never provided a report, written or verbal, on the status or balance of the People’s Fund,” the suit said, despite receiving monthly statements for the fund from the federal government’s Bureau of Trust Fund Administration. The bureau manages the financial assets of American Indians held in trust by the Department of the Interior.
The lawsuit highlights the alleged financial mismanagement of the tribe’s general fund, with more than $4.8 billion spent between 2010 and 2022, resulting in an apparent deficit of $940.8 million. Concerns are raised as the last known audit was completed in 2021 for the fiscal year ending in September 2018. Audits for 2020, 2021, and 2022 were not conducted, according to a news article published by the MHA Nation.
The leaked summary of the 2018 audit, conducted by auditing firm Moss Adams, revealed two adverse opinions and four disclaimers due to inadequacies in accounting records. The auditors were unable to accurately determine various financial aspects, including receivables, equity interest, capital assets, liabilities, net position, fund balances, transfers, revenues and expenses. The lack of proper accounting records made it impossible to provide an audit opinion on the tribe’s financial statements.
The lawsuit also accuses tribal officials of spending money recklessly and capriciously, favoring relatives and individuals close to those in power. An example cited in the lawsuit involves the son of a tribal official who allegedly purchased a house with little or no money down for $400,000 and later sold it for $600,000, pocketing a $200,000 profit. Such favoritism and lack of financial transparency have raised concerns among tribal members who seek fair and accountable governance.
The lawsuit further alleges the involvement of tribal officials in a kickback scheme with a construction contractor, Francisco Javier Solis Chacon. Two council members and two tribal employees were criminally charged in connection with this scheme. Chacon reportedly told FBI agents that working on the Fort Berthold Indian Reservation was “like being in Mexico” and that those with connections could do as they pleased.
In addition to financial mismanagement, the lack of public input and transparency in tribal governance is a significant concern. The lawsuit claims that tribal officials have failed to follow the requirements outlined in the tribal constitution regarding public notices, public meetings, and voting procedures. Chairman Mark Fox has been accused of issuing unilateral “executive actions” without prior notice or meaningful public discussion, limiting transparency and accountability.
