The lawsuit seeks more than $38 million in damages

California: Gold Country Casino's owners sue former tribal executives over fraud scheme

The tribe says in the lawsuit that its actual losses are more than $2.9 M and that it is seeking damages in that amount, plus more than $26 M in punitive damages and over $8.8 M in Racketeer Influence and Corrupt Organization damages.
2020-10-26
Reading time 2:23 min
The complaint filed Thursday by the Berry Creek Rancheria of Maidu Indians names a former chief financial officer and tribal administrator, claiming they skimmed off more than $1 million for personal trips and expenses via "a scheme centered around misappropriating tribal assets on a grand scale.”

The Indian tribe that operates Gold Country Casino Resort near Oroville in California filed a fraud and money laundering racketeering lawsuit in Sacramento federal court Thursday, alleging that two of its former top employees skimmed off more than $1 million for personal trips and expenses.

The lawsuit seeks more than $38 million in damages, and it describes a scheme that allegedly ran from 2011 through 2016 involving a “secret credit card” as well as money laundering from the tribal smoke shop to pay for limousines, concert and fight tickets and trips to Disneyland, Las Vegas and Palm Springs. “This complaint could devote countless paragraphs to detailing all of the other fraudulent charges,” the lawsuit by the Berry Creek Rancheria of Maidu Indians says, as reported by The Sacramento Bee. It also lists a number of expenses it considers improper, including a stay at the Bellagio Hotel & Casino and Elton John tickets in June 2014.

The complaint names Deborah Howard, its former chief financial officer, and Jesse Brown, who served as tribal administrator, and alleges they “entered into a discreet personal relationship and used their resultant joint power to supervise both the finances and business affairs of the Tribe to carry out a scheme centered around misappropriating tribal assets on a grand scale.”

The couple has since married, and Deborah Brown denied the allegations Thursday to The Sacramento Bee. She said she and her husband “absolutely not, did not steal even one dime.” “And it wasn’t a secret credit card at all,” Brown added. “In his position the tribal administrator always had a credit card and all the expenses that were charged on the credit card were always approved by the council.”

The lawsuit alleges the couple defrauded the tribe “in four unique ways,” starting with the “secret” credit card to rack up $1.3 million. The couple also allegedly misappropriated more than $200,000 “in cash withdrawals over the course of five holiday seasons that were meant to provide Christmas gifts to tribal youth,” the lawsuit says, and were “skimming more than $1.1 million of cash receipts from the Smoke Shop operated by Berry Creek before depositing the remainder of the funds into the tribe’s bank account.” The two also allegedly manipulated payroll records to provide themselves $250,000 in “unauthorized payroll distributions,” the lawsuit says.

“This course of conduct went on for years, involved thousands of individual (transactions) and was only discovered long after Ms. Howard and Mr. Brown’s departures from the tribe in 2017 when the bank finally disclosed the existence of the aforesaid credit card (after first informing the Berry Creek Tribal Council that its members could not access the account because Ms. Howard and Mr. Brown were the only authorized individuals),” the lawsuit says.

In addition to personal expenses, the lawsuit says funds were used by the couple to fund personal businesses. The tribe says in the lawsuit that its actual losses are more than $2.9 million and that it is seeking damages in that amount, plus more than $26 million in punitive damages (nine times the amount of the actual alleged losses) and more than $8.8 million in Racketeer Influence and Corrupt Organization damages.

The allegations in the lawsuit are reminiscent of other cases involving Northern California Indian casinos, including a lawsuit and subsequent 2017 indictment of three tribal officials of the Paskenta Band of Nomlaki Indians.

Leave your comment
Subscribe to our newsletter
Enter your email to receive the latest news
By entering your email address, you agree to Yogonet's Condiciones de uso and Privacy Policies. You understand Yogonet may use your address to send updates and marketing emails. Use the Unsubscribe link in those emails to opt out at any time.
Unsubscribe
EVENTS CALENDAR