In June 2008, the Department of Interior Inspector General (DOI-IG) issued a report describing how an employee at the Office of Special Trustee (OST) for American Indians steered lucrative contracts to an accounting firm whose principals lavished him with gifts, golfing trips, and a free place to live. But after two longs months, we're still waiting for Secretary of Interior Dirk Kempthorne to decide how to handle the case.
The firm that received the questionable contracts, Chavarria, Dunne & Lamey, LLC (CD&L), seems to have a Svengali-like hold over the agency. Four senior OST employees have been snagged in the scandal so far: 1) Delano "Jeff" Lords, Deputy Special Trustee for Trust Services, 2) Delano's brother, Douglas Lords, Deputy Special Trustee for Field Operations, 3) Donna Erwin, Principal Deputy Special Trustee, and 4) Margaret Williams, Deputy Special Trustee for Trust Accountability.
In fact, this is not the first DOI-IG report on the OST contracting scandal. In 2006, U.S. News and World Report highlighted the findings of an earlier report on the topic, noting:
According to the report, OST issued a $150,000 sole source contract to the Chavarria firm in October 1998 to perform trust fund accounting and consulting work. The special trustee's office modified the contract over 50 times, "increasing the value of the award to over $6.6 million, all without competition," the report says.
It says that Erwin and the Lords brothers [including Delano] did not award the contracts, but it adds, pointedly: "Interviews with the officials who were responsible for awarding the contracts revealed that they felt pressured by Erwin, Doug Lords, and Jeff Lords to award work" to the Chavarria firm.
At the time, Ross Swimmer, the head of OST, responded by giving slaps on the wrist in the form of ethics training. But the recent DOI-IG report makes it clear that the problem has not been resolved. In an unusually pointed statement, Inspector General Earl Devaney said he is "frustrated by the lack of accountability in this regard..."
The recent DOI-IG report details how Delano Lords "made the decision to select CD&L" to receive a contract even though a three-person evaluation team had unanimously selected Booz Allen, which submitted a bid that was $90,000 cheaper. As the report notes, in the previous DOI-IG investigation, "Lords stated that he had never awarded, or had the opportunity to award, a contract to CD&L since he had lacked the authority in the positions that he had held. He also stated that he had never showed favoritism toward CD&L..."
The DOI-IG also discovered that Lords had accepted free lodging from Brian Lamey, one of the principals of the firm, in violation of ethics regulations, and failed to disclose the gift on required financial disclosure forms. Although Senator Ted Stevens (R-AK) was recently indicted under similar circumstances when it was revealed that he failed to report an oil company's gifts, both the U.S. Attorney's Office in New Mexico and the Department of Justice (DOJ) have declined to prosecute anyone involved in the OST contract steering schemes.
One knowledgeable observer points out that DOJ is unlikely to prosecute senior employees of the OST because DOJ is currently defending the agency in the contentious multi-billion dollar Cobell Indian Trust litigation (a judge recently ruled that the government must pay $455 million to Cobell's side, although Cobell has promised to appeal). A criminal prosecution of OST employees would only serve to undermine DOJ's efforts to convince the court that the OST and other affiliated agencies at DOI are acting in good faith. DOJ is also unlikely to pursue anyone at CD&L, which, according to a May 2007 filing by DOJ, is listed as one of five accounting firms under contract with DOI to conduct the historical accounting of individual Indian money accounts, which has been a central point of contention in the litigation.
-- Beth Daley
What a complete disgrace. Albuquerque's Ch 13 had them busted for their activities and yet Ross Swimmer says he felt he has dealt with the matter and is closed.
Anything less than felonies against all involved including Ross Swimmer is a travesty.
Doug Lords and Donna Erwin were in Oklahoma last month speaking to OST matters, as if nothing was wrong.
At that public hearing, Doug Lords spoke to a "Risk Management" program he has implemented, isn't that rich, a potential felon discussing risk managment on IIM accounts.
Posted by: Lyle K. Deere | Oct 07, 2008 at 12:52 PM
It doesn’t matter if it’s June 2007 or June 1868, federal officials committing violations against Indian services will never get disciplined.
I am talking about the REPORT TO THE PRESIDENT BY THE INDIAN PEACE COMMISSION, JANUARY 7, 1868. There has been so many investigations on federal corruption in Indian services and reported to the U.S. President and Congress that still go uncorrected today.
The first sentence of the first recommendation out of the 10 stated:
“We recommend that the intercourse laws with the Indian tribes be thoroughly revised.”
Isn’t this trust reform? It did not happen then and will not happen now.
The second recommendation stated: “But it is insisted that the present Indian service is corrupt, and this change should be made to get rid of the dishonest. That there are many bad men connected with the service cannot be denied. The records are abundant to show that gents have pocketed the funds appropriated by the government and driven the Indians to starvation. It cannot be doubted that Indian wars have originated from this cause.”
There are many GAO, OIG, Senate commissions, court investigations, etc., that all reveal corrupt officials in Indian services. Have you ever heard of any of them going to prison? In trust reform today, I have witnessed employing questionable federal employees that continue the mismanagement and corruption of Indian services. They keep them, reward them but never punish them for what reports and investigations reveal. Corrupt officials will continue to do corrupt deals, if superior officials continuously promote, reward, legally and financially represent them against these findings. I am sure if there are others out there like them, they will find them and employ them. I also have witnessed the ethic cleansing in these BIA/OST of honest and trustworthy Indian employees.
The third recommendation stated: “That Congress pass an act fixing a day (not later than the 1st of February, 1869) when the offices of all superintendents, agents, and special agents shall be vacated. Such persons as have proved themselves competent and faithful may be reappointed. Those who have proved unfit will find themselves removed without an opportunity to divert attention from their own unworthiness by provisions of party zeal.”
The President and Congress were given notice of corrupt employee services then as they are finding in today’s Cobell Lawsuit today. These federal employees have never been punished.
The fourth recommendation stated: “We believe the Indian question to be one of such momentous importance, as it respects both the honor and interests of the nation, as to require for its proper solution an undivided responsibility. The vast and complicated duties now devolved upon the Secretary of the Interior leave him too little time to examine and determine the multiplicity of questions necessarily connected with government and civilization of a race. The same may be said of the Secretary of War. As things now are, it is difficult to fix responsibility. When errors are committed, the civil department blames the military; the military retort by the charge of inefficiency or corruption against the officers of the bureau. The Commissioner of Indian Affairs escapes responsibility by pointing to the Secretary of the Interior, while the Secretary may well respond that, though in theory he may be responsible, practically he is governed by the head of the bureau. We, therefore, recommend that Indian affairs be committed to an independent bureau or department. Whether the head of the department should be made a member of the President's cabinet is a matter for the discretion of Congress and yourself, and may be as well settled without any suggestions from us.”
The internal conflict of interest within the DOI with Indian services was also exposed in this report and that Indian Affairs should be an independent agency within the federal government. This would add some protection against its own protector and honor their treaties they wrote for us. But that still didn’t happen, has not happened today and may never happen. As Judge Lamberth wrote, “Thus, if individuals at the Department of Interior, including Secretary Norton, feel that as a result of this Court’s ruling they are unable or unwilling to perform their duties to the best of their ability, then they should leave the Department forthwith or at least be reassigned so that they do not work on matters relating to the IIM trust.”
The sixth recommendation reported to the President the problems of state encroachment on Indian Lands. The Indians needed more protection from States’ intrusion on Indian sovereignty.
The seventh recommendation stated: “In reviewing the intercourse laws it would be well to prescribe anew the conditions upon which persons may be authorized to trade. At present every one trades with or without the authority of the bureau officers on giving a bond approved by a judge of one of the district courts. Corrupt and dangerous men thus find their way among the Indians, who cheat them in trade and sow the seeds of dissension and trouble.”
I believe they are talking about outsourcing of federal trust responsibilities to private contractors. It has been recognized that private contractors have taken advantage of Indian appropriations, never stopped, and continuous to be a problem today. Why does this happen after 140 years of constant notice to the U.S. President and Congress?
Special Master Balaran wrote in one of his many reports about contractors, “In the final analysis, the January 16, 2002 Status Report to the Court Number Eight, did not convey “a clear and independent picture of trust reform.” It represented, instead, a collaborative effort by two organizations with ulterior motives. For EDS, the motive was to persuade Interior to buy more EDS. For Interior, it was to avoid liability at all costs. In the view of the Special Master, neither organization acted in the best interest of the public or the Court. They certainly were not acting in the best interest of the beneficiaries.”
I know that when I entered the federal government, the military and tribal government, that I took the Oath of Office. Do private contractors of Indian services take the federal Oath of Office? Does that make them exempt from federal ethics? Besides that, the contractor’s work was never checked for accuracy or compliance, only the process of selecting contractors.
There were 6 appended items to these recommendations and the sixth one stated:
“The account current of all moneys received and disbursed by authority of the commission.”
Apparently, there was concern over how the funds were accounted for. Were they talking about the appropriated funds to Indian services or the funds appropriated to the commission? Either way, there was concern over the federal administering of funds appropriated to Indian services as a forever point of corruption involvement by federal employees.
Termination of Indian services by federal employees is another strategy of broken treaties and federal trust responsibilities.
In the case of justice for all, it does not for American Indians.
Thomas M. Wabnum
IIMAccountholder@comcast.net
Prairie Band Potawatomi
IIM Accountholder
Former Federal Programs Relocation survivor
Former Indian Boarding School survivor
Former Tribal Councilperson
U.S. Navy Viet Nam Veteran
BIA/OST retired
Posted by: Thomas M. Wabnum | Sep 02, 2008 at 10:24 PM