Montana tops federal corruption prosecution listing

Spurred by the success of a program targeting fraud in tribal programs, Montana has had more corruption prosecutions than any other federal court district in the nation in recent months, the state's U.S. Attorney's Office says.

According to a study from a Syracuse University-affiliated research group, 18 people were prosecuted on federal corruption charges in Montana between October 2013 and April 2014. The second-ranked federal judicial district, spanning all of southern Florida, saw 15.

A news release this week from the Montana U.S. Attorney's Office, which prosecutes crimes in the state's federal court system, cited the study's findings as stemming from the success of its Guardians program, which targets fraud and official abuse involving federal funds.

The Guardians effort, Assistant U.S. Attorney Carl Rostad said, is a collaboration between federal prosecutors in his office, the FBI and the IRS, established in October 2011 in response to concerns over fraud in the spending of federal funds provided by the 2009 American Recovery and Reinvestment Act, or stimulus package.

As a result of those concerns, fighting corruption has become a focus for Montana's federal attorneys, Rostad said.

He pointed to the prosecution of former state Rep. Tony Belcourt and others alleged to be involved in siphoning off funds for a $33 million water project on the Rocky Boy's Reservation as an example.

In that case, court documents say, then-Chippewa Cree Construction Corp. CEO Belcourt directed contracts totaling more than $713,000 to Hunter Burns Construction company, owned by Hunter Burns and James Eastlick Jr., in 2009.

Almost simultaneously to payments for those contracts, the company wrote a $35,000 check to Belcourt's wife, Hailey, for "reseeding" work she wasn't equipped to readily provide.

Later, the tribal construction company awarded a $54,000 reseeding contract to Hunter Burns Construction.

Eastlick and both Belcourts ultimately pleaded guilty to felony charges related to the case, and prosecution against Burns was halted. Burns pleaded guilty to a related charge in April in another case — out of a total of six in which Tony Belcourt was indicted, involving nine defendants in all.

Compared to violent crime cases, where investigative work focuses on interviewing witnesses and gathering physical evidence, white-collar crime investigations involve pouring over financial information like bank account records to untangle complex plots.

"They're very document-intensive, very time-intensive," Rostad said. "An incredible amount of green eye-shade work."

Tommy Christian, a longtime leader with the Fort Peck Tribe, said one factor contributing to corruption in tribal governments is the extent to which power often isn't divided between executive, legislative and judicial branches able to check each others actions.

"We don't have that separation of government," Christian said. "Sometimes you need that oversight."

He also pointed to challenges presented by endemic poverty in reservation communities, saying "people just get desperate."

"Where is the dignity and the honor and the integrity of our leadership, nowadays?" he said. "This is what colonization has done to us as a people."

"It's keeping us oppressed — keeping us downtrodden," he added.

There are many tribal officials who do dutifully serve their constituencies, Christian noted.

In the news release, U.S. Attorney Mike Cotter, the chief federal prosecutor for Montana's judicial district, lauded work done by federal investigators.

"Relatively speaking, Montana is small office," he wrote. "But the Guardians have done truly remarkable work."

"Their efforts have unearthed widespread criminal activity and flagrant abuses of trust with regard to federal programs and grants designed to provide for the common good of our Indian communities," Cotter also said.

A listing of Guardians cases provided by federal prosecutors indicates that 28 people with connections to the Rocky Boy's, Blackfeet, Fort Belknap, Crow and Fort Peck reservations have been convicted of at least one fraud-related charge.

An additional seven defendants have been indicted and face pending cases, and two corporate entities have been convicted.

The investigation into Chippewa Cree business contracts has also seen Chippewa Cree Business Committee member John "Chance" Houle, former chairman Bruce Sunchild and Havre businessman Shad Huston indicted.

Other high-profile cases investigated by the Guardians project include eight people convicted of fraud in the $9.3 million 'Ka program, intended to work with troubled youth on the Blackfeet Reservation, and eight people accused of embezzling more than $500,000 from tribal accounts while working for the Crow Tribe's historic preservation office.

While the project has primarily investigated tribal corruption, Rostad said, it does have pending cases involving other federal employees.

Criminal cases, including fraud allegations, involving activity on reservations are generally prosecuted through the federal court system.

Criminal corruption cases involving state or local government officials are generally adjudicated through the state court system and prosecuted by local county attorneys, the Montana Attorney General's Office said Thursday.

Reach Staff Writer Eric Dietrich at 791-6527 or edietrich@greatfallstribune.

com. He can also be followed on Twitter at @GFTrib_EricD. The Associated Press contributed to this report.