WASHINGTON – Revenues exceeding $16 billion annually in the Indian gaming
industry have raised temptations as old as human nature itself, and now an
FBI-led working group of federal agencies has formed to protect tribal
casinos from theft, embezzlement, fraud, organized crime and corrupting
influences.

The group meets once a month to identify crime trends at tribal casinos and
consider specific cases for investigation. Thirty-one investigations are
current, according to statements offered at a press conference June 30 at
FBI national headquarters.

The working group is a new criminal justice resource in Indian gaming,
joining U.S. attorneys and state attorneys general, tribal security
measures, and front-line monitoring within Indian communities. Tom
Heffelfinger, U.S. attorney for the district of Minnesota and chairman of a
Native American issues subcommittee to the U.S. AG’s advisory committee in
the Department of Justice, declined to provide details of a trend,
mentioned by several speakers, toward “infiltration” of Indian gaming by
organized crime, adding that he can’t discuss cases that are currently
under investigation.

In the non-Indian gaming industry, Heffelfinger noted, revenues are lost to
crime at a predictable rate of 6 percent annually. There is no reason to
assume Indian gaming is exempt from that pattern, he said, though estimates
of actual monetary losses to crime at Indian casinos are not available.

The National Indian Gaming Association maintains that tribal governments
invested more than $200 million in regulating their gaming operations in
2003, on top of providing $50 million to states for oversight purposes and
$9 million to the National Indian Gaming Commission. NIGA’s Mark Van
Norman, seconded by Elizabeth Homer with the commission, urged the working
group to add Indian representation. The panel of speakers, none of them
Indian, made no commitment on that point.

By virtue of the Indian Gaming Regulatory Act, which extends federal
criminal jurisdiction over acts related directly to Indian casino
establishments, the FBI through its Indian Country/Special Jurisdiction
Unit oversees the Indian Gaming Working Group. The group includes FBI
sections on organized crime, Asian organized crime, economic crimes, money
laundering, and cryptanalysis and racketeering. Other participants are the
Department of Interior Office of the Inspector General, the National Indian
Gaming Commission, the Tribal Government Section of the IRS, the Treasury
Department’s Financial Crimes Enforcement Center, the U.S. Department of
Justice and the BIA Office of Law Enforcement Services, as well as tribal,
state, county, and local law enforcement agencies.

The Indian Gaming Working Group formed in February 2003, in response to the
growth of Indian gaming from approximately 100 tribes in a $100
million-a-year industry to 220 tribes and 359 separate sites generating $15
billion annually (a figure that is expected to exceed $16 billion in 2004).
The figure exceeds the combined gaming revenues of Las Vegas and Atlantic
City, according to the working group. Most of the operations are “cash
intensive” – that is, money changes hands as cash rather than as credit
transactions, which are more readily accounted for. Given the limitations
of the national budget for any one federal agency, the potential for crime
at so many cash-intensive operations, generating so much revenue, could
only be addressed through strategic cooperation between the agencies,
according to FBI spokespersons at the press conference.

The working group’s official purposes are to identify, and direct resources
to, the most pressing crimes in Indian gaming; review and facilitate Indian
gaming investigations; and serve as a channel for federal agency referrals
in cases of widespread national significance. A small group of IGWG members
decides whether or not the referrals rise to national significance; if so,
further review follows with invited participants from within the FBI, other
federal agencies and IGWG members. Ultimately, the working group can offer
the agency eliciting its help a host of support functions, from dispatching
experts to providing consultation. The FBI contact number for reports of
suspicious activity is (202) 324-3802.

Among a half-dozen crime trends the working group has identified is “Fraud
in the Approval Process,” widely debated of late in Congress and the media.
By implication of an FBI document distributed at the press conference, the
public announcement of the working group was perhaps not without a
political dimension: “Recent allegations of large scale fraud and
corruption have led to extensive media scrutiny and inquiries from
Congressional leaders as to the FBI’s response to these allegations.”