Cheyenne and Arapaho Tribal Embezzlement Convictions Stand
Two former Cheyenne and Arapaho Tribes of Oklahoma officials failed to convince a three-judge panel of the U.S. 10th Circuit Court of Appeals July 12 that evidence at trial did not support their sentences for embezzlement and for the theft of tribal funds to purchase vehicles and other items.
William F. Blind Jr. and his co-defendant and wife, Vinita H. Sankey, were indicted in 2008 in Oklahoma on conspiracy and embezzlement charges after the FBI in 2004 began investigating the use of gaming revenues from the tribes’ Lucky Star Casinos by business committee members, including Blind and Sankey, court records showed.
Twelve other people who primarily were business committee members or their employees were also convicted of embezzlement or theft in separate cases related to casino operations and tribal revenues.
Among items purchased with tribal funds by Blind and/or Sankey were a riding lawn mower, computer equipment, portable storage buildings, a 2002 Lincoln Town Car, a 2004 Chrysler 300M, and a 2003 Dodge 1500 Quad Cab pickup truck. A 2002 Dodge Intrepid belonging to the tribes was traded in toward the purchase price of the Chrysler, according to the court.
Tribal procurement procedures mandated that purchases over $5,000 required a sealed bidding process while those above $15,000 also required approval of the Tribal Council, composed of all adult tribal members.
To circumvent those procedures, a portion of cashiers’ checks constituting tribal funds intended for the couple’s tribal districts were deposited only in part and they received a portion back in cash. In addition, when Blind purchased the Lincoln, he paid for it with five cashier’s checks of $15,000 or less, avoiding Tribal Council scrutiny, the court said.
Some of the money from cashier’s checks was deposited into an account for the Barefoot Pow-Wow, an event no longer being held, the court noted, although evidence showed Sankey withdrew cash from the pow-wow account at various times “and used it to pay off her personal loans.”
Witnesses in the lower court said cash transactions were necessary in light of the tribes’ financial problems that had led to the tribes being placed by the BIA on “high risk” status because of mismanagement, although their expenditure of gaming revenues was governed by the Indian Gaming Regulatory Act.
Because of the high risk status, many local businesses would not take tribal checks, and Blind argued there was no evidence “he lived an extravagant lifestyle or had an expensive vice,” the court noted.
Both Blind and Sankey contended that because it was possible the cash was used for legitimate tribal purposes the government was required to show it was used for private gain, but the court pointed to strong circumstantial evidence, including transactions structured in an inherently untraceable way and the circumvention of tribal policies to prevent misappropriation.
Blind was convicted on tribal losses of $171,041 and ordered to pay restitution of $121,373, while Sankey was charged with causing losses of $218,387 and was ordered to pay restitution of $193,792. Although the appeals court upheld their convictions, it remanded to the lower court a restitution amount of $11,635 related to travel reimbursements because the government did not present evidence to support its charge that the amount should be repaid.
In June 2010, both Blind and Sankey were sentenced to federal prison, he for 33 months and she for 41 months, with both sentences to be followed by 3 years of supervised release.