New legislation lowers the Seminole Nation’s Civil Fine Assessment quarterly payment

By Dustin Gray
Media Specialist

On Wednesday, April 2, Seminole Nation Principal Chief Kelly Haney, along with National Indian Gaming Commission officials Philip N. Hogan, chairman, and Norm DesRosiers, commissioner, signed an agreement to modify the current payment schedule for the remaining $8.9 million balance of the Civil Fine Assessment levied against the tribe.

Under the terms of the original agreement, to which the Seminole Nation has strictly adhered since December of 2003, a fine in the amount of 20% of the tribe’s net gaming revenue must be paid to the United States Treasury on a quarterly basis. These quarterly payments are to be made until the original $11,376,000 fine amount is satisfied.

The fine was issued by the NIGC after the illegal actions of Ivy Kwok Ong, in his business ventures with the Seminole Nation, were uncovered. Ong had been the focus of an investigation by the NIGC, Bureau of Indian Affairs, IRS, Department of Interior, Inspector General and the FBI. He was convicted of conspiracy to commit tax evasion and conspiracy to pay and receive illegal gratuities this past September.

Ong’s business arrangements with the tribe were not initially reviewed by the NIGC, and he was never subjected to a background screening. He used profits generated from the Seminole Nation’s gaming facilities to set up numerous bank accounts, manipulating financial records in an effort to hide his assets from the IRS. Ong also attempted to bribe tribal officials for the advancement of his illegal schemes.

Ricky Van Deer, a former member of both the tribal council and the Seminole Nation Development Authority, was indicted last month for accepting Ong’s bribes. A federal grand jury accused Deer of soliciting 16 payments totaling $44,100, based solely on his power to impact tribal business transactions.

Ong is currently awaiting sentencing.

Chief Kelly Haney, like previous tribal leaders, was made aware of the ongoing investigations when he took office. He went to great lengths in compliance with agency procedures.

The unethical actions of those involved in the scandal cost the tribe an estimated $43,000,000. Even worse, their corruption compromised the integrity of the tribe; its general council, its programs, and its citizens.

While working closely with the NIGC and exercising strict compliance with the terms of their agreement, the tribe has also fought diligently to reduce the weighty quarterly fine payments. The cooperative efforts and tireless devotion of the administrative department, general council, Seminole Nation Gaming Commission and tribal attorneys, were instrumental in achieving the new legislation.

An initial petition for reassessment of the fine and reduction of quarterly payments, submitted by the tribe on June 29, 2005, was denied by the NIGC. However, after nearly two years of continued negotiations, the NIGC has finally accepted the tribal resolution.

Citing the positive efforts and significant strides made by the SNGC and the conduct of its gaming operations, the NIGC has agreed to reduce the quarterly U.S. Treasury payments from 20% of the Seminole Nation’s net gaming revenue, to just 10%.

“The Commissioners of the SNGC are to be commended for their untiring efforts, professionalism and outstanding attention to the details of federal
regulations, policies and procedures,” said Chief Kelly Haney.

The 10% payment reduction will satisfy an immediate need for increased services to tribal citizens. Tribal programs will now be able to obtain essential funding for their continued expansion and relief efforts.

Under the stipulations of the new agreement, the 10% of gaming revenue that would otherwise be paid to the U.S. Treasury can now be used to fund the regulation of the tribe’s gaming activities, law enforcement, social service programs, educational programs and scholarships, educational institutions and the establishment and operation of a tribal court.

The approval of the 10% payment reduction is effective immediately. An 18 month evaluation period will be enforced by the NIGC to ensure that the Seminole Nation continues to abide by the regulations of their agreement, and allocates their newly available funds appropriately.