Native American Press / Ojibwe News (Bemidji, Minnesota), 1996-03-15

              Turning a self insurance fund into a slush
fund: Leech Lake RBC and RRM
By Gary Blair
Qn Monday, March 11 the fraud
trial of three top Leech Lake officials
finally got underway at the federal
courthouse in St. Paul, MN.
The trial started March 4th;
however, the jury selection was halted
two days later when one of the
defendants, Daniel Brown, had to be
hospitalized. The trial is the first of
its kind in Minnesota's Indian
Country and has been dubbed the
"Trial ofthe Century."
Assistant U.S. Attorney Mike Ward
delivered the opening statement for
the government late Monday
afternoon. Ward outlined in graphic
detail the "scheme" which the
government says cost the Leech Lake
people more than 1.1 million dollars
at a time when the reservation was
nearly broke. Ward told the 12-
member all-white jury that the
government would show how the
theft was committed.
It was silent in the courtroom as the
jury was told about the fraud that the
government says involved Minnesota
state senator Harold "Skip" Finn,
who at the time served as the
reservation's attorney. Ward
explained how, in the mid 1980's,
attorney Finn—along with the
reservation's current tribal chairman,
Alfred "Tig" Pemberton and Leech
Lake secretary treasurer Daniel
Brown—had developed plans for a
company called Reservation Risk
Management (RRM). Ward said the
business was set up to self-insure the
reservation against liability losses
caused by fire and other damage,
including workmen's compensation
claims.
The government contends Finn
actually used most of the money the
business generated to purchase luxury
automobiles, property, fancy golf
carts, season tickets to professional
ball games and country club
memberships for his friends. Ward
accused Finn and his accomplices of
"turning a self-insurance fund into a
Fund cont'd on 3
Expert witness testifies on self ins. at Finn Trial/ pg 1
Anish. man senten. over hunting rights disp./ pg 1
Sen. Finn fraud, theft trial opens/ pg 1
Former tribal Chair, senten. for car ramming/ pg 1
Turning a self insurance fund into a slush fund/ pg 1
Voice ofthe People
J
Anishinabe man sentenced to jail for
asserting treaty hunting rights
By Jeff Armstrong
Minnesota 9th District judge Paul
Rasmussen ordered Leonard Butcher
to pay a $ 1,000 fine and serve 10 days
in Clearwater County jail for his
conviction on charges related to
hunting within disputed reservation
boundaries.
Rasmussen denied a defense request
to delay execution of the sentence
pending an appeal, stating that
Butcher would have to make that
motion to the state appeals court. He
was ordered to report to the County
Sheriff to make arrangements to serve
the jail time within 30 days of his
March 4 sentencing.
Neither the prosecutor nor the presentence      investigator      had
recommended incarceration for the
43 year old Anishinabe man, who has
yet to find a lawyer to represent him
on an appeal.
"It's racist all the way," said
Butcher, who said hunting and
gathering has always been integral to
the cultural and physical survival of
the Anishinabe people. "First they
take my gun, then they turn around
and give me a fine and jail time.
Where did we lose our right to be
ourselves? Where does it say they
bought our culture?"
The Anishinabe White Earth member
was hunting with a tribal license on
land jointly claimed by the state and
the reservation when he was stopped
by a state. DNR agent in October
1994. Butcher claimed then and now
that he was hunting within reservation
boundaries during White Earth's deer
season. Reservation hunting
ordinances and licenses do not specif}
the boundaries to which they apply,
and a staff member at the White Earth
conservation office said she did not
know how the borders were defined.
If the land had been found to be
within the reservation, the state would
have lacked jurisdiction to enforce
most, if not all, ofthe charges against
Butcher, which included Driving
After Cancellation, Taking a Deer in
Closed Season, Obstructing Legal
Process, and Transporting Uncased
Firearm in a Motor Vehicle.
Although the obstructing charge may
not have been considered a civil
regulatory statute, Butcher's partner,
Rights cont'd on 5
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We Support Equal Opportunity Far All People
Founded  in 1988 Volume 8   l»ue B2 March 15, 1996
I
A weekly publication.
Copyright. Motive American Praaa,  1996
Money for Nothing     Expert witness testifies
By Frank Bibeau
"Something for nothing" is what
Jenny Emery called the Reservation
Risk Management custom insurance
policy to the Leech Lake Band of
Chippewa. Ms. Emery is the Federal
Government's expert witness in self
insurance, working for the world's
largest independent risk management
cwiiaiiliant firm of Tillinghast-Towers
Perrin, based in Connecticut.
Her testimonial opinions summed
up on the prosecution overhead were:
1) RRM provided no insurance
coverage to the Leech Lake Band.
2) Under RRM plan, the Leech
Lake band was deprived of the full
benefit of self insurance.
3) The compensation paid to the
administrators of RRM was
excessive and notfair or reasonable
to the Leech Lake Band (not
rationally related to services
provided).
4) The terms of the RRM Self
Insurance Plan were not fair to the
Leech Lake Band.
Her analysis of the RRM Custom
Plan was "it had all the trappings of
an insurance policy" but it wasn't
insurance, since "at all times the
money was the Band's money" as
there was "no risk to anybody but the
Band." Ms. Emery went on to say
"essentially (the1 shareholdei
agreement) took the band's money
and gave it to Mr. Finn."
Ms. Emery went on to sa>,
was no evidence Mr. Finn ever paid in
Money cont'd on 8
A happy group of Red Lake Warriors celebrate capturing the '96 Sub-section 29 championship by beating the
Clearbrook-Gonvick Bears 75-56 last Sat night. The Warriors will be taking on the Fertile Falcon at 8:00 p.m.
tonight (Thurs.) at the U of M Crookston Fieldhouse in section 8A semi-finals. p^o by Paimer Berg
MN Appeals Court rules state
tribal 'trespassers'
can prosecute Finn's lawyer tells jury: Hail senator,
don't punish him
By Jeff Armstrong
After less than one month of
consideration, the state Court of
Appeals refused to overturn the
trespassing conviction of a Leech Lake
woman who asserted her right to
occupy unused reservation housing.
District judge Michael Haas denied
Michelle LaRose's challenge of the
court's subject matter jurisdiction on
Aug. 10 of last year. Four days later,
a Cass County jury found the
Anishinabe woman guilty of two
counts of trespassing.
On appeal, a three-judge panel ruled
that Minnesota courts have authority
to apply state trespass laws on
reservations subject to Public Law
280 jurisdiction. "LaRose argues that
the trespass statute is merely an
extension of the state's regulation of
real property ownership and
occupancy," said the appeals court.
"Minnesota's criminal trespass statute,
however, is distinguishable from such
regulatory laws in that it prohibits
certain conduct: entering or
occupying another's property," stated
the opinion signed by Judge Bruce
Willis.
The defense contended that by
applying the law on tribal trust land,
the state was, in effect, regulating
reservation housing, exceeding its
authority under PL-280's criminal
statute. The U.S. Supreme Court has
found that the law did not grant states
unlimited civil authority, but instead
preserved the right of tribes to establish
their own regulatory laws.
"Cass County is, by proxy,
attempting to regulate Indian housing
in Indian country. This kind of
regulation should be done in the
federal court system to maintain the
integrity of Native American property
issues," argued public defender Jay
Sommer's brief.
The essence of LaRose's case,
however, was the argugment that she
possessed a "claim of right" to
available housing as a tribal member.
The Appeals Court rejected this
argument: "The trespass statute
prohibits, rather than regulates, entry,
or occupancy of another's dwelling or
Court cont'd on 3
By Paul Gustafson
Star Tribune Staff Writer
Rather than being indicted for
embezzlement, state Sen. Harold
(Skip) Finn should receive plaudits for
creating a self-insurance plan that
saved money for the Leech Lake Band
of Chippewa, Finn's attorney told a
federal jury Tuesday in St. Paul.
Doug Kelley, Finn's attorney, said
tribal officials clearly understood
Finn's plan when they approved
creation of Reservation Risk
Management (RRM), the corporation
through which he and two tribal
officials —Alfred (Tig) Pemberton,
51, chairman ofthe Leech Lake Band,
and Daniel Brown, 71, its secretary-
treasurer — operated the tribal self-
insurance plan.
"Everyone knew if insurance claims
were similar to past experience that
the tribe would save money. And it
was no secret that Skip was going to
make money," Kelley said.
Finn, 47, a DFL senator from Cass
Lake, was indicted on 24 felony
counts related to an alleged scheme
in which he, Pemberton and Brown
conspired to embezzle more than $1
million from the tribal self-insurance
plan created in 1985. Pemberton is
charged with eight felony counts, and
Brown with three.
"Our defense is pretty dog-gone
simple. We signed a contract with the
tribe, we did what we were supposed
to do, and we took out less money than
Finn cont'd on 3
Former tribal chairman sentenced to jail in
car-ramming incident
Suit to end BIAsupportfor indicted officials
set for March 20 hearing
On Wednesday, March 20, members
of the White Earth and Leech Lake
Reservations will request U.S. District
Court Judge Richard H. Kyle to
appoint a trustee to oversee the
scheduled 1996 tribal elections and to
recover the funds illegally taken.
Tribal members of White Earth and
Leech Lake Reservations have sued
Bruce Babbitt, Secretary ofthe Interior
and Ada Deer, Commissioner of the
Bureau of Indian Affairs for failure to
carry out the trust responsibility of the
United States toward the membership
of these reservations. Tribal
government   officials   of  both
"We appeal to tribal
members to be there on
Wednesday, so the judge
can see that we do care
about the affairs of our
tribe"
-Erma Vizenor
reservations currently are facing
federal felony charges of stealing
millions of dollars from their people,
there on Wednesday, so the judge can
see that we do care about the affairs of
our tribe," said Erma Vizenor, one of
the White Earth plantiffs. There is a
widespread fear of rigged elections in
1996 unless the Court appoints a
trustee pending the outcome of
criminal indictments.
The hearing will be held
Wednesday, March 20 at 8:00 a.m.
in courtroom # 3 on the 7th floor of
the United States Courthouse, 316
N. Robert St., St. Paul.
REDWOOD FALLS, Minn. (AP) _
The former chairman of the Lower
Sioux tribal council will serve 90
days in jail for ramming a car off a
county road, mistakenly believing it
contained political foes.
Joseph Lyman " Jody" Goodthunder,
49, was sentenced Monday on two
counts of criminal vehicular operation
and one count of drunken driving.
Judge George Harrelson stayed a
one-year prison sentence and $2,000
in fines and instead imposed the jail
time and 480 hours of community
service for the Jan. 6 incident that
seriously injured two people.
Goodthunder was also ordered to
pay the victims $5,560, get chemical
dependency treatment and complete
an anger management program.
Goodthunder rammed his pickup
three times into the car of lifelong
friends Dennis and Beverly Roper,
allegedly mistaking them for a rival
family in the Lower Sioux community.
The early-morning incident followed
an afternoon and night of heavy
drinking. Goodthunder's blood
alcohol level was .20, twice the legal
limit.
The Ropers, who still haven't
recovered fully, urged the court to be
lenient with Goodthunder.
"I don't feel any jail time is
necessary," Dennis Roper told the
court. Roper, a Morton carpenter,
Former leaders vie for tribal presidency
Sen. Finn's fraud, theft trial
Prosecutor says band misplaced
PINE RIDGE, S.D. (AP) _ Two
former Oglala Sioux tribal presidents
battle each other Tuesday for the job
they once held.
Voters are choosing between Paul
Iron Cloud and John Steele in the
general election on the Pine Ridge
Indian Reservation.
Two other former presidents, Gerald
One Feather and Johnson Holy Rock,
say both candidates would do a good
job back in office.
"Both have been there before, know
where they made mistakes, and know
some ofthe places that can be tapped
(for jobs)," Holy Rock said.
Iron Cloud rescued the tribe from
bankruptcy after previous
administrations' money troubles, One
Feather said. One Feather was a
consultant during both Steele's and
Iron Cloud's administrations.
Both Iron Cloud and Steele support
treaty rights, he added.
Four unsuccessful primary
presidential candidates have
encouraged their supporters to vote
for Iron Cloud. Steele was the top
vote-getter in the primary last month,
getting 1,024 votes to Iron Cloud's
633.
Third-place finisher Mike Carlow
has campaigned hard for Iron Cloud.
"We carry some of the. same ideals,
and I know what he can do with
contacts for jobs," Carlow said. "He's
honest and has the heart ofthe people
in mind. He's the man."
By Paul Gustafson
Star Tribune Staff Writer
A prosecutor told a federal jury in
St. Paul Monday that the Leech Lake
Band of Chippewa made a one fatal
mistake in deciding to self-insure its
businesses and properties: It trusted
state Sen. Harold (Skip) Finn to carry
out its wishes.
Instead of helping the band, Finn
helped himself, his family and several
tribal officials to more than $ 1 million
that was siphoned illegally from the
self-insurance plan, said Assistant
U.S. Attorney Michael Ward.
He said the 47-year-old DFLer from
Cass Lake, who was legal counsel to
the band's business committee, turned
the self-insurance fund into a "slush
fund," which he used to embezzle
hundreds of thousands of dollars and
buy powerboats, vehicles and other
perks, "The evidence will show that
Harold Finn took over $700,000 of
that money... without exposing
himself to any financial risk ...without
suffered broken ribs and blood clots.
He still wears a brace for a neck injury
that may require corrective surgery.
Tribal leaders from across the state
wrote to the judge, urging leniency.
Goodthunder had testified earlier
that he did not rememberthe incident.
"I know what I did was wrong and
I just hope I have a chance to rectify
some of what's happened," he said
before sentencing.
Goodthunder pleaded guilty last
month to two counts of criminal
vehicular operation and one count of
drunken driving. In exchange, two
counts of first-degree attempted
murder and two counts of assault
were dismissed.
opens
its trust in him
himself investing one single penny,"
Ward said.
When band members and federal
investigators began asking where the
money went, Finn allegedly destroyed
documents and bribed at least one
tribal official, Ward said.
One false invoice the government
will offer as evidence was used to
cover a kickback to Myron Ellis,
whom Finn instructed to destroy
incriminating   documents,   the
Trial cont'd on 3