Congressman Sean Duffy made a request to four federal agencies on October 6 requesting audits of alleged mismanaged federal funds by the LCO Tribe. He asked for a response by October 20 but that deadline has been extended.
Duffy made the request in response to a petition turned in by 113 tribal members.
Read the original story here: Congressman Duffy Requests Forensic Audit of Lac Courte Oreilles Federal Funds
Following a press release issued by Duffy on October 13, he visited several mold-contaminated homes on the Lac Courte Oreilles Reservation.
The homes Duffy visited were supposed to have been fixed as part of a mold remediation grant issued by Housing and Urban Development in the amount of $800,000 in September of 2015. Over a year had passed and the mold-infested homes still sat. Sometime within the past couple of weeks, construction on several of those homes began.
Glenda Hall of the LCO Housing Authority confirmed that the first five homes scheduled for remediation has begun.
The petitioners asked Duffy to have a forensic audit done for all tribal finances, but cited the Housing grant as one example of mismanaged federal funds.
“In the process of assessing the petitioners’ concerns, I was invited to see some of the tribe members’ homes,” Duffy told DrydenWire. “Days later, I am still feeling the effects of the mold, and I only spent a short amount of time in these houses. Yet, that is where small children, some with severe asthma, lay their heads each night.”
Several tribal members gave Duffy a tour of some of the mold-infested homes. Richard Conger, a member of the group that turned in the petition, was one of them. He said one of the homes had a bedroom that was actually sealed off from the rest of the home because of how bad the mold is.
Conger said as soon as you open the front door of the home you can smell the mold pour out. Children live in the home. This is what Congressman Duffy was able to witness for himself.
Shondel Barber, one of the tribal members who turned in the petition to Congressman Duffy, questions why LCO Housing is suddenly scrambling to get the project started over a year from when they were issued the grant.
LCO Housing Director Mark Montano told the media at an LCO tribal press conference on Monday, October 24, the LCO tribe hasn’t assessed the $800,000 in grant funds yet.
“Montano said there hasn’t been any draw down yet, but doesn’t HUD send the money to LCO, which then handles the draw-downs from Housing when they need it,” Barber questioned. “Is Montano saying that the entire $800,000 is still in Washington?”
Barber said she believes the money was sent to LCO but not used for its intended purpose of fixing these homes. She pointed out that all federal funds and tribal funds are comingled in a series of bank accounts, and can easily be used for other purposes.
“This is why it’s so necessary for a federal audit,” Barber said. “To show our people those funds aren’t being used for other purposes. Our people living in these mold homes deserve that much.”
Chairman welcomes audits
LCO Chairman Mic Isham issued a statement claiming Duffy should have contacted the tribe before going public. “We find it truly unfortunate that Congressman Duffy has not respected our Tribal sovereignty, or the government-to-government relationship, by not directly communicating his concerns to our Tribal leadership.”
Isham claimed in a press conference on October 24 all the media attention from the audit request has done economic damage to the tribe. He said a bank pulled out of a business deal with the tribe that would have benefited both LCO and the Hayward area. DrydenWire has learned this financial project was a casino bond refinancing in the amount of $33,000,000 and a story in coming days will examine this project further.
Congressman Duffy mentioned the casino in his initial audit request to the federal agencies as one of the tribal entities that should be examined.
Barber said the petitioners believe the casino should be part of the audit request.
“The casino can now be included in the federal audit because the tribal governing board comingles all of their funds and federal statute says that once the tribe puts their private funds into the same accounts with federal grant funds, it all becomes federal funds, making it all susceptible to a federal audit,” Barber said.
“The LCO leadership should welcome this audit as an opportunity to be fully transparent with their members. If everything is in order, it should not only help build trust with their members, but also help them with future business endeavors,” Duffy added. “In the meantime, the leadership should turn their focus to resolving the severe mold issues as quickly as possible.”
Isham continues to claim the tribe has nothing to hide and they welcome audits. Isham said the tribe has annual audits done as required by the federal grants. In a statement issued by the tribe, they said Duffy could see the audits at the Federal Audit Clearinghouse.
A spokesperson for Congressman Duffy told DrydenWire they couldn’t find any federal audit information on the tribe. A search of the clearinghouse by DrydenWire confirmed the same findings. What was found was that the tribe received more than $13.7 million in federal grant funds in 2015 for housing, the school and the college.
The tribal government conducts its own spot-check independent audits, but not forensic audits, which provide a much more in-depth analysis of financial management and conditions. The most recent forensic audit performed at LCO was an independent audit done by Forensic Solutions LLC, in 2013, which identified 17 findings and possible widespread fraud at LCO.
Wisconsin 7th Congressional Democratic Candidate, Mary Hoeft, who is opposing Duffy in the November 8 election, stood by LCO Chairman Isham during his press conference on October 24. She said Duffy should have met with tribal leaders first, but instead is making it a huge issue and, “making the Lac Courte Oreilles people feel they are guilty of something they are not, and shame on him.”
Shondel Barber told DrydenWire that Hoeft is wrong in her statement that Duffy made the LCO “people” feel bad. Barber said Mic Isham isn’t the “people.”
“The tribe does its own audits and in the forensic audit of 2013, Forensic Solutions asked Norma Ross why she would only allow auditors to see certain programs and departments. She didn’t allow them to see Housing for one,” Barber said. “And yet, Mic believes the Congressman should have come to him first for the same run around. He wouldn’t have been shown a real forensic audit. Mic said the Congressman was hoodwinked by the petitioners, but it’s Mic who has Mary Hoeft hoodwinked and anyone else who believes our tribe has been audited every year.”
Tribal Sovereignty
Hoeft issued a statement on her Facebook page Mary Hoeft for Congress. She said to Duffy, “You said it was your duty to respond when more than 100 signatures on the page requested the audit. Why did you make NO effort to resolve the issue by speaking with tribal members? Why the big headlines? Were you trying to punish Mic Isham because he considered running against you?”
Hoeft said when she met with the LCO Tribal Council that she felt the tribe was owed more discussion before the Congressman called for a federal investigation. She said Congressman Duffy should have reached out to tribal leaders because they are a sovereign nation.
Another member of the petitioner’s group, Richard Conger, addressed Hoeft’s remarks on Facebook. “We, the members, tried many, many times to get answers from the council,” in regards to tribal finances. Conger said Isham called them losers and said the group was nothing but a mob.
“The mold problem has been around for years. Babies, elders, handicapped people, are still living in this deadly situation,” Conger said. “We are treated like second class citizens on our own reservation. They sit in their offices and get large amounts of money for doing nothing. Untrained, unskilled, yet drawing full wages above $70,000.00 a year plus, while the rest of the members lose what little money they make, or their hours are being cut back for lack of funds.”
Conger addressed Hoeft’s claims about tribal sovereignty. He said, “Far as sovereignty goes, you talk to the people, not just the group that we are questioning, the council. We are the sovereign nation not just seven members of the council. They are just seven members of the nation.”
Shondel Barber said sovereignty goes out the window as soon as the tribal council collects federal funds. “Just because we are a sovereign nation doesn’t mean we don’t have to answer for the millions of dollars in federal grant funds we collect. That is still taxpayer money and it has to be spent on what it was allocated for.”
Shondel said she went to the Kinnamon School Museum on the LCO Reservation Thursday, October 27, for a Mary Hoeft meet and greet with tribal members but the event was cancelled. Barber said the tribal governing board told Hoeft to cancel the event because members of the petitioner’s group were going to be there to ask her about her support of the council in this issue.
“I just wanted to ask her, despite sovereignty, if she feels that as a tribe that takes federal money, if we should be held accountable to those federal agencies issuing those funds, and if so, then why should Congressman Duffy need to consult the tribe first before recommending to those agencies they do an audit,” Barber said.
Barber said she and Hoeft exchanged words in disagreement on the Mary Hoeft for Congress Facebook page, but the conversation has since been deleted and Barber has been blocked from her page.
“The tribal governing board in itself is not sovereign. They are a board elected to represent the sovereign people of LCO. They have failed miserably at this task. They have their own agenda,” said Deb Baker, another petitioner.
Baker said it wasn’t an easy decision for the petitioners to go to Congressman Duffy’s office, “But, we had every right to contact him. We had three petitions we turned in to the tribal governing board and we were ignored every time.”
Baker said they have issues with how the tribal governing board operates in secret. “They don’t have to follow open meetings laws and they have not shown any tribal finances to the membership.”
Baker said she sat in tribal council meetings every week for eight years, unless she was removed for executive sessions and, “from that I know there’s a lot of money coming through that tribal office, in the millions, and yet you drive around the Rez, we look like a third world country.”
Baker said she would like the petitioner’s group to hold a meeting and invite tribal members and members of government to come and have a discussion.
“We need to have a meeting and invite people who are questioning our motives and show people what it is we are trying to accomplish, and answer their questions,” Baker said.
Former LCO School Administrator, Mike Leahy, made a Facebook post after the previous DrydenWire story about Duffy’s audit request. He said, “There were significant fiscal irregularities evident (at the LCO School). I was told not to have any communication with the BIE concerning school finances. It appears that the presence of honesty was seen as a threat. I tried to get them to at least honor the remainder of my contract, but they said no. I attempted legal recourse but, due to tribal sovereignty, I am left empty handed. I would be more than willing to provide any information to Congressman Duffy concerning this investigation.”
Another person posted on Facebook after the previous story as well, in regards to the excessive overdraft fees. “$491,385.46 overdraft fees or NSF insufficient funds?? This is total incompetence!!!”
And another responded, “The LCO Tribe responded “We find it truly unfortunate that Congressman Duffy has not respected our Tribal sovereignty, or the government-to-government relationship"--can't have it both ways folks. You are receiving taxpayer dollars, you have to be accountable. This entire thing not only makes me sick because it is such a waste of taxpayer money, but because of the injustice to members of the tribe. Imagine what $491,385.46 could pay for out at the school or the clinic. Instead it went to overdraft fees? Total incompotence.”
Barber said she is voting for Duffy because he’s the one who showed he cared about our people.
“He went to those homes to see how they were living. Where was anyone else? Our own tribal leaders don’t care about us,” Barber said. “Why didn’t Mary Hoeft go see how those people are living before she said our people were being picked on?”
Note: Attempts to contact Mary Hoeft in regards to this story and questions sent to her campaign manager in recent days went unanswered.
Last Update: Jun 20, 2017 3:04 pm CDT
