Tribal regulators struggle with small staff

Alan Sayre

Monday, April 21, 1997 | 11:59 a.m.

A small federal agency with only six investigators and a fraction of the budget of most state gaming overseers is trying to bring an expanding number of Indian casinos into compliance with federal regulations.

At the end of 1996, only about a quarter of the 273 tribal casinos, bingo halls and off-track betting parlors had fulfilled all requirements laid down by the National Indian Gaming Commission.

The commission's operations fell under fire in November during a U.S. Senate hearing. Commission chairman Harold Monteau was labeled as an industry cheerleader by Sen. Harry Reid, D-Nev., who said the tribal casinos are ripe for a major scandal.

In turn, Monteau said his agency is hamstrung by Congress' failure to give the commission enough operating funds.

The commission covers gaming operations in 28 states with a staff of 33 and an annual operating budget of $4.4 million. By comparison, New Jersey has a $50 million annual budget and Nevada has a $20 million annual budget to govern their casino industries.

One of the problems include a backlog of pending fingerprint checks at the FBI, which has delayed criminal background checks on casino workers, leaving the commission to rely on tribal suitability checks to weed out undesirables.

In addition, the commission has had to choose its enforcement actions carefully. However, in recent months, officials say enforcement actions have been stepped up.

Also, some operations have not submitted required audits and paid required fees to the commission, although newer establishments have not been open long enough to be audited.

"It's almost a ridiculous situation. We have six investigators covering more than 200 operations. Some regulatory bodies have several people assigned to each gaming operation. It's an unworkable situation," said Alan Fedman, director of the commission's enforcement division.

But Fedman said he believed that major integrity issues about tribal gaming operations -- such as the honesty of games, accounting of money and the weeding-out of undesirables who try to work in the establishments -- are more than adequately protected since the tribes take an active role in regulation.

"It's in their best interest as a business to do so," Fedman said.

Currently, the commission is trying to determine if reservation betting operations met a March 31 deadline to reach full compliance with major regulatory requirements.

Already, 30 tribes that missed the March 31 deadline have reached consent agreements with the commission to comply, said commission spokeswoman Charlotte Hrncir in Washington. She said the commission hoped to issue a new compliance report within a month.

As of the end of 1996, 53 gaming operations were listed in compliance with eight major items, while 220 were out of compliance with at least one requirement, the commission said in its latest quarterly report.

Under commission regulations, tribes wishing to conduct casino gaming must have a compact with the state; submit investigative reports, fingerprints and employee applications to either the FBI or an approved state agency; and have a commission-approved ordinance permitting gambling on their reservations.

Tribes make the final determination of whether a gaming employee will be declared suitable. Although regulations say that determination cannot be made until a criminal background check is finished, it is currently taking two to four months for the FBI to finish the work, the NIGC said.

Reservation gaming, which was legalized by Congress in 1988, is not regulated by the states since tribal reservations are considered to be federal preserves. In some states, however, tribes have contracted with state authorities to perform certain security functions.

Gaming critics have said the explosion of reservation wagering has gone far beyond Congress' intent. They also say the gaming industry, many of whose members manage the reservation casinos, have used Indian casinos as a wedge to get states to legalize casinos so they can collect tax dollars.

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