Thursday, June 6, 2013

FBI Probe Continues As Chief Financial Officer Exits At Resort And Casinos For Mississippi Choctaws

Pearl River Resort
An FBI investigation that started in July 2011 at Mississippi Choctaw casinos is ongoing, according to a credit-rating report issued last month.

Meanwhile, the chief financial officer (CFO) at Pearl River Resort is resigning this month. (See letter announcing resignation, at the end of this post.) Ryan Eller, who previously worked for Alabama's Poarch Band of Creek Indians, had been on the job less than nine months. (See press release about his appointment, at end of this post.)

Chief Phyliss J. Anderson has not kept tribal members updated on either development, a source tells Legal Schnauzer. In fact, Eller's departure only came to light because the resignation letter accidentally was sent to all users on the tribal e-mail system.

According to the letter, Eller resigned "due to personal reasons related to his mother's terminal illness." But our source says staff at Pearl River Resort report that the CFO had been looking for another job.

The new developments at Mississippi Choctaw facilities could have an impact in Alabama. Former Republican Party lobbyist Jack Abramoff, who spent roughly four years in federal prison on corruption charges, has admitted that he funneled some $20 million into Alabama to help Bob Riley win the 2002 governor's race over incumbent Democrat Don Siegelman.

A proponent of an education lottery in Alabama, Siegelman was seen as a threat to the Choctaws' market share, which depends heavily on Alabamians who cross the border to gamble in Mississippi. Indian gaming interests and their GOP benefactors also apparently pushed for the federal Alabama bingo trials of 2011 and '12, which resulted in zero convictions after the expenditure of millions in taxpayer dollars.

Could an FBI probe at Choctaw headquarters shine light on events that have turned Alabama into a political cesspool over the past dozen years? It's still too early to say, but an investors report out last month indicates the FBI is lurking in Choctaw territory, hinting that something still could come from the inquiry.

We first reported an FBI raid at the Silver Star and Golden Moon casinos on July 12, 2011. Two days later, we had a post titled "Why Did the FBI Launch a Raid on Mississippi Choctaw Gaming Facilities?" We tried to put events into perspective with this:

When news broke on Tuesday afternoon of an FBI raid at the Silver Star and Golden Moon casinos, many Alabamians wondered if it was driven by the political ugliness that has engulfed our state since George W. Bush entered the White House. After all, news reports indicate that Mississippi Choctaws spent $13 million, funneled through Republican felon Jack Abramoff, to help get Bob Riley elected governor in 2002. And Riley's apparent desire to protect the Choctaws market share, by stamping out gaming in Alabama, led to a federal electronic-bingo prosecution that is ongoing in Montgomery. 
If Tuesday's raid has anything to do with Riley, Abramoff, and perhaps the Bush administration (hello, Karl Rove!), it would be a major national story. But so far, we have no indication that such weighty issues are driving the investigation. If they are, that would mean the Obama Department of Justice actually has its head out of you know where--and we've seen no sign that Eric Holder and Co. are up to the task of investigating and prosecuting Bush-era crimes.

One week after that, we reported that the FBI investigation had connections to Mercury Gaming Group and the Titan Agency, of Atlanta. Last July, we reported on the apparent suicide of a former U.S. prosecutor who had worked for the Choctaws.

Since then, the FBI probe has generated nothing but silence. But a report from Moody's Investors Service, dated May 2, 2013, has generated noise. It changed the ratings outlook to positive from stable for Choctaw Resort Development Enterprise (CRDE). While the report noted improvement in certain key areas, it's big-picture view was a mixed bag:

The outlook revision to positive reflects a sharp improvement in run-rate EBITDA (earnings before interest, taxes, depreciation, and amortization), largely owing to expense reductions from the termination of certain unfavorable vendor contracts. The outlook revision also recognizes changes to improve the Enterprise, including the establishment of a stable and professional management team. Notwithstanding these positives, the rating also captures weak topline trends due to soft regional economic conditions and the competitive nature of the inland markets where the casinos are located. While the bulk of major expense reductions are largely complete, Moody's still expects the Enterprise to prudently manage its costs such that EBITDA remains relatively stable despite contracting revenues.

Dark clouds continue to hover over the Choctaws' financial report. From Moody's:

The [rating] reflects Choctaw Resort's small size, earnings concentration in a single jurisdiction, relatively low population density in its primary market, weak gaming revenue trends, and the challenging local economy in its primary markets in Mississippi and Alabama. The rating also captures the high level of tribal distributions as a percentage of EBITDA and the expectation they will continue to be maximized (as per the credit agreement and bond indenture), and uncertainty related to the outcome of the FBI investigation that has been ongoing at the Enterprise since July 2011. Moody's will continue to monitor further developments from this investigation and assess potential rating implications as appropriate. In addition, the rating reflects the high degree of uncertainty surrounding the enforceability of lenders' claims at default and other unique risks common to Native American gaming issuers.

Near its conclusion, the Moody's report again raises the FBI issue:

Moody's could revise the ratings outlook back to stable if revenue declines worsen such that EBITDA meaningfully deteriorates from current run-rate levels. Any factors/events that could debilitate the gaming operations would likely result in downward rating pressure, including an adverse development in the FBI investigation, management turnover/corporate governance issues, and/or a deterioration in liquidity.


Anonymous said...

Wow, I've been wondering whatever happened with the FBI investigation in Choctaw World. Maybe we will find out something yet.

Anonymous said...

The Schnauzer has been digging. You, sir, are to be applauded. This story needs light . . . and has needed it for a very long time.

Anonymous said...

My most pleasant dream remains this one image: Bob Riley in an orange jumpsuit.

Milk Dud said...

Is is possible Eric Holder still might serve some purpose in life?

Anonymous said...

Hmmm, the CFO was on the job about nine months and then bailed when his mother developed a "terminal illness." Riiiiightttt . . .

Anonymous said...

The key to a lot of dirty secrets runs through Indian gaming, especially in Mississippi. Fingers crossed.

Anonymous said...

Another story from LS that we won't find anywhere else. The MSM reaction . . . zzzzzzzzz

jeffrey spruill said...

What!!! The FBI hasn't murdered someone?

Unknown said...

jeffrey, I'm with you on the FBI and the signature that recently was to tell us all how it is, single shot execution to the back of the head, assassins do this for their very own trademark.

FBI, CIA, DHS, and the list of sucking vampires on Americans is too many to count.

... America, either duped or fully complicit, has given Israel that capability, a “Samson option” first strike against any nation, even America.

>> One might want to ask why nuclear bunker facilities for up to 80,000 elites from among the “chosen people”are being financed by the United States, a project reminiscent of Dr. Strangelove.

>> Newspapers claim the underground base, one of a series being built across Israel, is part of an air defense system. This is, of course, utterly absurd.

SOOOOOOOOO it seems our USA is involved in the no news other than the true enlightened and that would be ...

Thank you as always, LS,

Abrakadabra Jack Off and the CHRISTIAN CRUSADERS OF THE SOUTH were an integral part of this mess that the House of Saud-Bush built ~ as IN the MUSLIM hogwash too. Drugs, religions, sex and poisons mixed with nukes, what a cocktail to be refused.

Anonymous said...

We have to read everyday as though there is no going out of doors without knowing what is going to happen which is definitely not a safe 'reality'

~link included is about democracy in the digital age

Are we, USA, a republic or democracy?

It's time to reboot the US Constitution, in my reading about the problems we suffer from.

Thinking of this whole mess and what a mess it is ~ the Indians of the Southern Tribes and then the Blacks and of course all the 'breeds' of all humans, can't forget the whitey. Add the countless faith corporations and the religious, whew diversity is continuing too in same sex this and that.

Anyway, there is only in reality to treat the US Constitution as a great computer that is now in the age of digital and gets to have a reboot, an act of common sense.

I'm perplexed otherwise because the words are too confusing as analog in a digital format.

jeffrey spruill said...

Those FBI guys just can't help themselves.

And they certainly believe the U.S. Constitution gets in their way.

So what do you think they told Karl Rove when he approached them about the problem of Don Siegleman?

I bet dubya is proud of Obama:

legalschnauzer said...

Obama is on his way to being one of the biggest disappointments in presidential history--and this is coming from someone who voted for him twice, with very low expectations.

Obama is proving that Ralph Nader was right: Both major parties suck, and neither one can be trusted.

Anonymous said...

"You've calculated? What does that mean?"

"It means we have algorithms. We have gnomes from MIT who do the math for us. They don't miss. You're going to sound like a broken record in a year. And it's going to go downhill from there, for the rest of your terms in the White House."


"This is a twofer, Barack. You serve until 2016. It's in the bag."

...Obama smiled. "First time I've heard that."

"Take it to the bank," Mark said. "Unless you really screw up, in which case, we'll wrap you in scandals that'll make your head spin."

The unspoken qualifications for president of the United States, by Jon Rappoport, June 6, 2013

An announcement: This is satire.

Anonymous said...

It should be noted that the new Egyptian government is demanding the US release Abdel-Rahman.

I’ll leave the last word to Lynne Stewart herself, written in prison to a friend:

“I have been fortunate to live a charmed life ― parents who loved me without qualification.

“I had children when I was young enough to grow with them. Today they are the backbone of my support and love.

“I came to politics in the early sixties and was part of a vibrant movement that tried to empower local control of public schools to make the ultimate changes for children and break the back of racism in minority communities.

“My partner/husband Ralph Poynter was always 60 years and counting in my corner. I had a fabulous legal career ― championing the political rights of the comrades of the 60s and 70s and also representing many who had no hope of a lawyer who would fight for them against the system

“I have enjoyed good friends, loved cooking, had poetry and theater for joy ― but all of this good fortune has always meant only one thing to me that I have to fight, struggle to make sure everyone can have a life like mine.”

You can sign a petition for the release of Lynn Stewart here.

Visit Justice for Lynn Stewart for more information.

Anonymous said...

What's it going to take for the FBI to investigate corruption in AOC and AOJ? They have a dept just for that purpose!