78 Navajo Nation Council members accused of fraud

A special prosecutor filed a lawsuit against 78 current and former Navajo Nation Council members alleging massive fraud in their use of $36 million in discretionary funds intended for Navajos in need.

A special prosecutor filed a lawsuit against 78 current and former Navajo Nation Council members alleging massive fraud in their use of $36 million in discretionary funds intended for Navajos in need.

The lawsuit filed Thursday accuses the council members of unlawfully taking about $36 million belonging to the deeply impoverished American Indian reservation from 2005 through 2010 to benefit themselves and their families.

The council receives millions of dollars a year through supplemental budget appropriations to dole out to elderly Navajos on fixed incomes, college students, organizations in need or Navajos looking for emergency funding. Any member of the nation can seek financial help from a single lawmaker every six months.

The nation's Supreme Court put on hold the discretionary until rules were established on how they could be doled out.

The civil case comes after all or nearly all of criminal cases against council members for alleged misuse of the money were dismissed. The lawsuit seeks the recovery of the money and accuses council members of ignoring their responsibility to keep tight controls over the nation's money.

"These officials have divested themselves of their duties of honesty and transparency, choosing instead to perfect the art of self-dealing, ineptitude and secrecy," said the lawsuit filed by special prosecutor Alan Balaran.

Tribal Council Speaker Johnny Naize, one of the lawmakers who was sued, said the lawsuit was a shoddy piece of legal work by the special prosecutor. "He is throwing darts again trying to see if any will stick," Naize said.

David Jordan, an attorney who represented dozens of lawmakers in the criminal cases, said Balaran has billed the nation for $1.1 million for his investigation and came up empty handed.

Balaran didn't immediately return a call seeking comment on Friday afternoon.

The lawsuit said that one sampling of the misspent money found that council members gave more than $2 million to 130 recipients with little regard over whether they were poor. The recipients received checks ranging from $10,000 to $54,000.

Another sample found that family members of 14 council members received $51,000 to $130,000. Additionally, millions of dollars went to Navajo Nation employees, even though they were ineligible to receive them, the lawsuit said.

The lawsuit said Joe Shirley Jr., the nation's president from 2003 to 2011, sanctioned the passage of dozens of unlawful budget appropriations that resulted in the illegal conversion of tens of millions of dollars belonging to the nation.

Shirley approved resolutions which appropriated money to the discretionary fund and to a charitable contribution fund and which were falsely touted as emergency legislation, the lawsuit said.

The filing accuses Shirley of supporting appropriations knowing the money would be spent to enrich delegates, their families and other ineligible recipients.

"It's outrageous that you could sue President Shirley for signing off on a budget," said Jordan, who has advised Shirley on the investigation by the special prosecutor.

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