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Goverment Slaps BIA in Heavy Equipment Scam

March 1, 1995

SIOUX FALLS, S.D. (AP) _ Bureau of Indian Affairs bungling allowed the illegal resale of about $59 million in government-owned heavy equipment, scrap metal and other gear from 1991 to 1993, Interior Department investigators say.

Lack of oversight allowed officials of the Sisseton-Wahpeton Sioux Tribe to set up the scheme reselling the goods for about 25 percent of its original cost to the government, according to an Interior Department report released this week. The scheme would have netted $14.9 million for those involved in the scam.

One BIA official, Charles Hacker, was convicted of felony corruption in the case. He faces up to two years in prison and a $250,000 fine at his April sentencing.

In a related investigation, Sisseton-Wahpeton Tribal Chairman Russell Hawkins and businessmen Roger Raether and Donald Jerke are set to go on trial May 23 on federal charges of conspiracy, lying to the government and theft from a tribe in connection with a deal to provide the Seminole tribe with a 300-ton crane.

The three men have pleaded innocent, saying they’re the victims of a squabble between government agencies.

Federal law required BIA officials to oversee the program and ensure the equipment was used correctly, the report said. The BIA’s shortcomings included:

_ Providing blank, pre-signed property transfer forms that allowed businessmen to get equipment without further BIA oversight. Hacker was one of four BIA officials who provided such forms.

_ Failing to check whether the tribe was actually using the equipment for the contract under which it was obtained. For example, the tribe got more than 6,300 pieces of equipment worth $20.9 million for an administrative contract ``which did not require any equipment,″ the report said.

_ Allowing at least a dozen BIA officials to approve transferring equipment to the tribe. Those officials worked in offices in Washington, D.C.; Albuquerque, N.M.; Aberdeen and Sisseton, and none of the officials knew how much equipment other officials approved for the tribe, the report said.

In a preliminary response dated Oct. 31, BIA director Ada Deer said the agency will no longer acquire equipment to give to tribes because a 1994 federal law puts responsibility for the program on the tribes.

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