Auditors reviewing spending

By Tony Thornton

Published: January 9, 2008

CONCHO — Federal and private auditors are so thick at the Cheyenne and Arapaho tribal complex, they may have trouble staying out of each other's way.

Four auditors from the National Indian Gaming Commission arrived Tuesday, one day after a three-person team contracted by tribal Gov. Darrell Flyingman began looking at financial records.

The two teams have separate missions.

The federal auditors want to assure the tribe has spent its casino profits, estimated at $2 million to $2.5 million a month, according to a plan filed with the Bureau of Indian Affairs.

That plan allots 25 percent for economic development, 53 percent for several specific categories of general welfare for tribe members, 2 percent for government operations and 20 percent in direct payments to tribe members.

In a separate arrangement, Flyingman contracted with the accounting firm Grant Thornton to look into the last two years of expenditures by the tribe's Lucky Star casinos at Concho and Clinton.

Flyingman has long alleged the casino's former management company, Southwest Casino and Hotel Corp., made unauthorized expenditures in hopes of having its lucrative contract renewed. The company ran the casinos for more than 13 years until last summer.

Flyingman said the private audit was needed, because the National Indian Gaming Commission agreed only to examine the more limited scope of spending.

"For the last three years I've provided the NIGC with information about wrongdoing, and nothing's ever been done about it,” he said.

The federal auditors will be on site for up to a month, and the private auditors for two weeks, Flyingman said.

One certain aspect of the federal audit involves the tribe's connection to Rimrock Technologies, a Utah-based telecommunications company.

An oddly worded tribal council resolution authorizes Flyingman to obtain feasibility studies on the company.

The resolution was approved Oct. 6 by the tribal council, which consists of all adult voting members. It authorizes Flyingman to "enter contracts to conduct feasibility studies on the potential to construct and operate travel plazas and related businesses specifically the acquisition of Rimrock Technologies in the following locations: Concho, Clinton, Canton, Watonga, Elk City, Geary, Seiling and Hammon.”

A recent company flier obtained by The Oklahoman says Rimrock Technologies is "a division of the Cheyenne & Arapaho Enterprises.”

A letter faxed to the tribe on Sept. 27 outlines a proposed purchase price of $18 million for that company and two subsidiaries: Rimrock Network Services and Rimrock Maintenance Services.

Flyingman and Rimrock's chairman, Patrick Foley, both said the proposal hasn't been consummated.

"We're still in negotiations with the governor to come up with a final agreement that we're both happy with. No sale has transpired whatsoever,” Foley said.

Federal auditors have been asked to determine whether that is correct, based on the flier and the tribal council resolution, said Ida Hoffman, the tribes' legislative speaker.

"We haven't seen anything. That's why we're questioning it,” she said.

Foley said the company has 24 employees in five states. Its main customers are tribes, including the Cheyenne and Arapaho Tribes and the Lawton-based Comanche Nation, he said.

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