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(SAN FRANCISCO) – Attorney General Bill Lockyer and U.S. Attorney Kevin V. Ryan today announced seven former officials of the Coyote Valley Band of Pomo Indians will be arraigned Wednesday on 39 federal counts of theft and misuse of tribal casino funds, conspiracy, obstruction of justice, tax evasion and failure to file tax returns.
“The federal indictment alleges the defendants used for their own personal gain funds that were supposed to benefit the tribe as a whole,” said Lockyer. “This prosecution seeks to hold the defendants accountable, and protect other California tribal communities and their children by deterring such misconduct.”
The defendants will be arraigned Wednesday at 9:30 a.m. in U.S. District Court for the Northern District of California. The defendants – all former members of the Tribal Council of the Coyote Valley Band of Pomo Indians – were indicted on the charges on August 16, 2006. The court unsealed the indictment Monday.
The defendants include: former Tribal Chairwoman Priscilla Hunter, 59, of Ukiah; former Tribal Historian Michael Hunter, 32, of Ukiah; former Tribal Vice Chairwoman Iris Martinez, 55, of Roseville; former Tribal Secretary Darlene Crabtree, 32, of Pinoleville; former Tribal Council Member-at-Large Fred Naredo, 56, of Santa Rosa; former Tribal Treasurer Michelle Campbell, 39, of Redwood Valley; and former Tribal Council Member-at Large Allan Crabtree, 54, of Nice.
Ryan’s office will prosecute the case, which resulted from a three-year investigation launched and led by the Division of Gambling Control (DGC) in Lockyer’s office. The following agencies also assisted in the investigation: the U.S. Department of the Interior’s Office of the Inspector General; the Internal Revenue Service; the National Indian Gaming Commission (NIGC); the Mendocino County Sheriff’s Department; the Ukiah Police Department; and the Northern California Computer Crimes Task Force.
The indictment alleges several offenses occurred between 1999 and 2004. First, Priscilla Hunter, Martinez, Campbell and Michael Hunter are charged with conspiring to steal and misapply tribal funds from at least mid-2001 through 2004. Second, the indictment charges Priscilla Hunter and Martinez with theft and misapplication of more than $40,000 of the Shodakai Coyote Valley Casino’s funds. The indictment bases these charges on Priscilla Hunter’s and Martinez’ alleged improper and systematic booking of first class rather than coach flights when traveling on business.
Third, all seven defendants are charged with willful misapplication of funds belonging to the tribe’s Shodakai Casino, and conspiracy to commit that offense, by using approximately $25,300 to make political contributions. The indictment alleges the contributions contravened a 2001 settlement agreement with NIGC, the tribe’s gaming ordinance and federal regulations prohibiting such use of casino funds. Fourth, the indictment charges Priscilla Hunter, Martinez and Campbell with obstruction of justice and conspiracy for taking a number of steps to impede a July 2003 audit of the casino by NIGC. Finally, the indictment charges Priscilla Hunter with tax evasion in 1999, 2000 and 2002 and failing to file tax returns between 1999 and 2003, and Campbell with failing to file tax returns between 2000 and 2003.
According to the indictment, Priscilla Hunter, Martinez, Campbell and Michael Hunter conspired between at least May 2001 and December 2004 to take and misapply funds belonging to the tribe and casino. The indictment alleges the defendants used credit and debit cards issued and funded by the tribe to purchase personal items for their own benefit, in contravention of the 2001 settlement agreement with NIGC and tribal and casino fiscal policies and procedures. The defendants used tribal or casino funds to purchase numerous items for their personal use, including New York Islanders hockey tickets, art, DirecTV services and airline tickets, according to the indictment.
The seven defendants made the alleged improper political contributions between April 2002 and March 2004 to several federal and California politicians and political organizations, the indictment charges. Gaming revenues must be distributed 50 percent to tribal members as per capita payments, according to the indictment, and 50 percent to designated purposes to benefit the tribe. The indictment further alleges that this misuse of funds was not consistent with the terms of the 2001 settlement agreement with NIGC.
Regarding the obstruction of justice charges, the indictment notes NIGC in 2003 launched a probe into the tribe’s and casino’s compliance with the 2001 settlement agreement. Instead of cooperating, as required under the 2001 settlement agreement, Priscilla Hunter, Martinez and Campbell conspired to participate in the alteration and destruction of tribal and casino records, with the intent to impede, obstruct and influence NIGC’s investigation, the indictment alleges. As part of the conspiracy, Priscilla Hunter directed a tribal employee to black out account information in financial records maintained by the tribe and the casino, the defendants met to alter and falsify those business records, and a casino employee shredded certain business records, according to the indictment.
The maximum, statutory prison time and fine for each count is as follows: conspiracy (18 U.S.C. § 371), five years imprisonment and $250,000 fine; willful misapplication of casino funds (18 U.S.C. § 1167(b), 10 years imprisonment and $250,000 fine; obstruction of justice (18 U.S.C. § 1519), 20 years imprisonment and $250,000 fine; tax evasion (26 U.S.C. § 7201), five years imprisonment and $250,000 fine; failure to file tax return (26 U.S.C. § 7203), one year imprisonment and $25,000 fine.
The August 2006 indictments followed by almost two years the May 25, 2004 execution of nine federal search warrants at casino and tribal offices and the residences of five of the defendants. A DGC special agent working the case provided the affidavit on which the search warrants were based. Seized evidence included financial documents and computers.