In response to my last article that was published on this
blog on Monday night, LCO Financial Services issued a statement and Lee Harden
attended the LCO Elder’s Association on Wednesday morning in an attempt to
explain the business.
Lee claimed my article was 90% false, and yet, proceeded to
tell the elders he couldn’t share with them what we invested. He was bound not
to talk about it. Basically, it’s the tribe’s money, but we can’t know what was
invested.
Lee confirmed to the Elders that there are several layers of
businesses set up through LCO Financial Services. This is company on top of
company on top of company, and yet, only a couple of them actually operate.
Rosette law tried to state that many businesses set up this way in planning for
the future. But, this is exactly what federal and state regulators have claimed
against Cane Bay with their dozens of payday loan scheme sites. Once regulators
find one site, Cane Bay directs its customers to a different site they already
have in waiting.
“Lee said that no up-front money was required to create LCO
Financial Services. However, it was noted that at least $600,000 is invested
into an internet gambling venture and the money is still sitting there. Other
sources state that the initial investment is $1 million dollars. Need to see
the actual paperwork,” Sue Aasen said on her Facebook page in reporting after
the Elders Association meeting.
Lee lied. Two tribal council members who were sitting on the
board at the time we gave Cane Bay $1 million to invest have confirmed this
happened. They explained a tiered system whereby if we invest $3 million, we’d
have a larger percentage, all the way down to the $1 million we eventually
invested.
He claims we did in fact, invest in ITOGA, and claims the
money is still sitting there. Demand to know just where it sits! ITOGA no
longer exists!
You are being lied too!
There is $1 million dollars missing of LCO Casino money that
someone stole! Was it ITOGA? Was it LCO Financial Services Board members? Was
it Lee, Mic, a few of their cronies? We don’t know, but it’s missing and he just
confirmed it was invested.
Who really made up ITOGA? Norma Ross was appointed to its
board to represent LCO. Here is a link to the tribal council page of the
chairperson of this organization that once existed. Her name is Sherry Treppa. http://www.upperlakepomo.com/council/
On this page, in her Bio, it mentions all of her
affiliations, and her membership to NAFSA, and yet fails to mention ITOGA!
Then Sue Aasen goes on to report, “the LCO casino upper
management is directly involved in managing the subsidiary companies. Lee
stated that people meet in his office during lunch hour and they get paid
$200.00 per meeting at 4 times per month.”
That’s an additional $9,600 per year paid to these casino
executives, Lee, Dulcie Rae Wolfe and Randy Cadotte, and other well-paid tribal
employees, including our court commissioner Bill Trepania and credit union
manager, Di-Z Cross. This doesn’t include other expenses they are paid.
And we have yet to confirm whether these guys pay themselves
as managers of these various companies.
Sue also reported the following;
“Both Lee and Mic Isham (taped statement) said that 1
million dollars was put into the tribe's general funds over the last four years
from these operations. Funds were used to build the Farmers Market structure
and rehab the Halfway House.
“When I asked to see the actual documents, Lee Harden said
that he cannot release documents because they are proprietary. Even though we
are tribal members, we cannot see the information. I have to go to the TGB for
permission.
“Lee encouraged the elders to inquire and don't believe Joe
Morey's lies.
“It is impossible to inquire and form an independent opinion
when the holder of the documents will not release anything. They are running
things like a private corporation. LCO is a tribal government where things
should be available to review and obtain copies. Government should be
transparent,” Sue reported.
How true, Sue. They are also operating like their own
private corporation outside the arms of our tribal government, just so they can
hide all this information from the tribal membership!
Lee and Mic said $1 million was put into the general fund,
which according to my sources was actually higher, and yet the only economic
development they cited was the farmer’s market gazebo by the LCO Quick Stop.
That’s literally the only economic development our tribe has seen in four years
under Mic Isham as chairman!
So, according to Lee and Mic, they deny we invested $1
million into Cane Bay, but other council members say otherwise. In a nutshell,
we invested $1 million to only have brought in $1 million four years later!
Yeah right!
And then they say, “hey look everybody, we built a gazebo
for all our efforts,” and guess who built that gazebo and pocketed $35,000? Mic
Isham’s brother, Mark, and two other workers, one of which, actually claims he
got less than 10% of that total, and got screwed by these guys. Unreal.
Sue also said, “I have a lot of questions about the LCO
Financial Services with all of its subsidiary corporations. A tribal forensic
audit in 2013 did not include the Casino. Lee said on Wednesday, that LCO
Financial Services is looking for a qualified CPA and that it is not uncommon
for a new company not to do audits for 3-4 years. The membership should require
a forensic audit of all the companies.”
Say what? No audit? But, wait, Chairman Isham said our tribe
does great auditing of ourselves. He says our tribe is doing great and we are
like an open book. No audit in four years is a serious problem and we should
demand answers, immediately.
What are the other members of the tribal council doing about
this? They are quietly sitting there allowing this to happen.
Why would they defend this? Because they are part of the
problem.
Think about it. Rose Gokee came from the Legal Department
where all this got set up. She was the legal secretary under Jim Schlender in
2013 when this was set up. Jim was the attorney who created the paperwork and
sat on the board. Jason Schlender is Jim’s brother.
A lot of this circles back around to the Legal Department. Bill
Trepania is the court commissioner who now sits on the board. Ari Johnson is a secretary
in the Legal office, and a source just called me and told me that her husband,
Alan Johnson, works at LCO Development and through his own company, not LCO
Development, got the bid to rehab the Halfway House into the new offices of LCO
Financial Services.
Cronyism at its best!
Everything leads back to the same little crew, all tied to
Lee and Mic and the Legal Department that has their hands in everything on this
Rez!
Back to the ties of the council members. Jason Weaver is Mic’s
cousin. He also has no integrity, as shown by his extensive past history of six
criminal charges for abuses towards women and children and his most recent,
striking an LCO elder in the head with a beer can.
The only one of the four current council members who I
personally don’t think has anything to do with this is Joel Valentin. I’ve
known Joel for many years and he was a past long-time law enforcement officer
here at LCO, and has more integrity than the others. And he is the only one who
made a comment to me prior to the story breaking about LCO FS.
As candidate Louis Taylor said, if they don’t separate themselves
from this and call for an immediate investigation, then they are part of the
problem.
And remember that LCO… if they take over the officer positions
after this election, then nothing is going to change! We won’t ever see the
true financial statements of this LCO FS. We won’t ever know where the money
trail surely leads and we won’t ever know who on this Rez is really involved
and how deep their involvement!
LCO Financial Services false claims
LCO Financial Services claims it is a critical component to
the financial independence, health and welfare of the Lac Courte Oreilles
Tribe.
“Those who might seek to attack or cause harm to LCOFS bring
harm to the LCO Tribe and its people. LCOFS creates income, on-reservation
jobs, educational scholarships and many other benefits for the tribe. LCO fully owns 100% of its lending portfolios
and is in full voting control of these assets. There are no other equity
holders,” their statement said.
The scholarships are handed out to people they hand pick, who
are close to Mic and his cronies. I mean, come on, Jason Weaver received a
$5,000 scholarship in 2015, just after winning the primary election. This
$5,000 represents 10% of the total given out by Cane Bay and LCO FS over the
years. That $50,000 started out over 10 years ago, long before Cane Bay was
here, and Weaver gets a scholarship that big. Unreal.
LCO FS claims they own all of their lending portfolio and
that Cane Bay is only a vendor, and yet, in their own press release about the
scholarships three weeks ago, they refer to Cane Bay as their partner.
They are lying when they say they own their portfolio. They
don’t. Many multiple sources have confirmed that the company is operated out of
the Virgin Islands, and that we invested in them. Sources include past council
members.
The statement goes on to say, “LCOFS employs a variety of
vendors and third parties who have state-of-the-art expertise in ecommerce,
internet networking, hardware management, software and related technologies and
risk analytics. Under the auspices of the LCOFS Board, each of these vendors
complies with the prescribed regulatory criteria and delivers comprehensive,
professional and objective management to the business of LCOFS.”
Absolutely false. Cane Bay is under investigation from many
state attorney generals for their unfair practices in those states. They are to
appear in a jury trial lawsuit in California on March 26, 2018. To avoid these
state regulators, they “Rent a Tribe” because the tribes can claim sovereign
immunity.
LCO FS claims this is a great operation for our tribe, and
yet, hardships here at LCO are worse than they have ever been. More of our
people are out of work. Only six homes were fixed with the mold remediation
grant that we received $800,000 to fix. Only six! No construction projects,
except a farm market gazebo. Our enterprises all shutting down under Mic Isham’s
administration, for example, the C-Store 2 gas station, just before the summer
season started. Many other things have been closing up shop around our Rez.
LCO FS also claims it is fully complaint with all Native
American Financial Services Association (NASFA) best practices related to
marketing, regulatory compliance, payment processing, customer disclosure,
collections and other areas of portfolio management.
I’ve shown extensively throughout the LCO FS article how
this just isn’t true. Another lie.
They state the complaint rate for LCOFS is one of the lowest
in the industry with less than 0.1% (.001) of transactions resulting in a
customer complaint of any sort. I’ve shown a couple dozen complaints alone on
the Better Business Bureau site. I’ll let those pages speak for themselves.
I’ll wrap up with this about LCO FS. If it’s such a positive
for our tribe, why is Mic Isham out asking Hayward businesses for a $1-million-dollar
loan? A source has confirmed to me that he asked the owner of Big Fish Golf
Club in June of 2015 for that loan on behalf of the tribe. This was two years
after the millions we invested in these e-commerce businesses.
Also, I’d like to add that I’ve now heard that LCO FS,
through Hummingbird Funds or Minaan Funds, which operates Ladder Credit,
obtained a $20-million-dollar loan through Vector, the equity fund that
invested into Cane Bay, for the purpose of doing our own loan disbursements,
and yet, we are still doing the loans through Cane Bay. This happened late
summer last year.
Where is that money? Where does it sit? If it’s to have the
capital to disburse loans, then so be it, but then why are we still in business
with Cane Bay?
The new bond deal
Here is more from Sue Aasen’s statement on her Facebook
page. Here she goes on to make some statements about the $30 million bond deal.
“I am presently tied up in the hunt for information of the
new bond to refinance tribal debt and remodel pieces of the Casino. Today,
during my two-hour appointment to look at the new Bond debt of $20.7 million
and a secured loan of $9.8 million dollars, it was weird to be watched at all
times. Legal Director Kekek and his legal secretary did not leave the room as I
read a grossly incomplete document.
“What is happening is a refinance of a 2006 Bond debt of
$31.4 million that was the subject of a lawsuit in 2013. If the tribe does not
add more debt in a refinance today, the 2006 Bond is scheduled to be paid off
in 2023. Since Lee Harden affirms that LCO Financial Services is making a
profit, the Casino should be remodeled with those funds.
“I have a lot of questions about the justification for new
Bond debt. This new Bond debt is just cause for a Tribal Referendum to decide
whether the membership wants to enter into this large debt burden. The payment
schedule for the new bond is extended out to June 1, 2032. The payments are
tied to the Casino Revenue. I doubt the Casino will be operating through the
year 2032.”
In closing…
WE NEED AN URGENT FINANCIAL AUDIT OF THIS ENTIRE TRIBE!
And this includes all programs that receive federal dollars,
and the LCO Casino as well as LCO Financial Services.
The new tribal council, seated in a few short weeks, needs
to invite Congressman Sean Duffy to bring in the feds and look at everything. The
casino and LCO FS can and should be included because our tribal funds are all
commingled, meaning a casino falls into federal jurisdiction with federal grant
dollars once this is done.
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