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Judge Accuses Interior of Playing Politics

WASHINGTON, D.C. ? Checks for Indian trust account holders still haven't gone out nearly a month after a court order allowing delivery, and the Federal judge in the case is sounding as frustrated as the people who are waiting.

Judge Royce Lamberth accused Secretary of Interior Gale Norton of trying to turn the delay to her advantage in the marathon trust account lawsuit. Reconvening the related contempt of court case after a holiday break, he said her department was displaying "Washington Monument syndrome."

"Here in Washington, we have something called the 'Washington Monument syndrome," he said. "Every time

Interior loses its appropriation, the first thing they do is close the Washington Monument. Then they go to [Congress] looking for money.

"I really don't understand why Interior can't deal with this differently," he added.

Norton and Assistant Secretary for Indian Affairs Neal McCaleb are defendants in the contempt case for their alleged failure to implement court orders in the trust account lawsuit. To date, tens of thousands of trust beneficiaries have yet to receive scheduled federal payments because computer systems at Interior remain shut down. Interior is blaming the delayed payments on the court. But a second order by Lamberth on Dec. 17 allowed Interior to reactivate the necessary computer systems to issue the checks, under court supervision.

Judge Lamberth spoke after Keith Harper, an attorney for the plaintiffs, said that Interior officials have still not issued Individual Indian Monies, or IIM, trust checks to 43,000 trust beneficiaries, despite the Dec. 17 order.

"They have with great success been able to get paychecks out," said Harper. "The Secretary, I'm sure, got her check. A cynical person would think they're playing politics."

"Or pressuring the plaintiffs," Lamberth responded.

In the temporary restraining order issued on December 5 by Lamberth, Interior was ordered to immediately disconnect all information technology systems and computers "that house or provide access to individual Indian trust data." However, despite clear directives limiting the order's scope to trust related systems, Interior officials shut down all of its systems. The Judge had granted a request by Indian plaintiffs to close down the system after he unsealed an investigative report documenting "deplorable and inexcusable" lapses in computer security for trust data.

However, under a subsequent order, Interior was granted permission to operate and reconnect some of its systems, but only after a seventy-two hour notice and the approval of Alan Balaran, the court-appointed Special Master. Balaran's reports to the court documented serious breeches in computer security and efforts to mislead the court and Indian beneficiaries. The Judge also placed limitations on which activities Interior could engage in while using the system.

Eric Ruff, a spokesman for Interior, said that some payments are being made, such as general assistance, but royalty payments will be delayed until Interior can come to an agreement with the court's special master.

Thomas M. Thompson, Deputy Special Trustee in the Office of the Special Trustee, told the court after two weeks on the stand, that Norton and McCaleb filed false reports without the support of the Office of Special Trustee and ignored the court's orders to provide a full historical accounting of trust funds. His testimony is now being supported by his boss, Thomas Slonaker, the Special Trustee. Slonaker took the stand just after Thompson and raised further doubt about Interior's motives.

Asked by the plaintiffs' attorney Dennis Gingold if a report filed by Norton late last year was untruthful, Slonaker responded that it was incomplete and that he could not confirm its accuracy.

"If you take truthful and equate it to accurate and complete, it was not truthful," said Slonaker.

Slonaker also confirmed that the computer system used by Interior to handle the trust data was poorly designed and a failure, a fact he says was concealed from the court.

The 1994 American Indian Trust Reform Act established the position of a Special Trustee to oversee and direct all aspects of trust funds management reform within the BIA, the Bureau of Land Management and the Minerals Management Service.

The 1994 Act called for the appointment of a Special Trustee who possessed ability and experience in the general management of large entities along with knowledge of trust fund management, management of financial institutions, and the investment of large sums of money.

Before assuming the role of Special Trustee, Slonaker worked for the First Interstate Bancorp, one of the largest bank holding companies in the United States. He was Executive Vice-President and Chief Investment Officer with investment responsibility for approximately $27 billion of trust assets.

Slonaker's testimony also supports the accuracy of the court reports which form the basis for the contempt charges against Norton and McCaleb. He also criticized Interior's current trust management strategy.

"Until the plan is overhauled and thought through more carefully I don't think we can say we're on the right track," Slonaker said.