Mississippi Choctaw’s Audit Firm Quits After FBI Raid
After more than a decade of serving as an outside auditor for casinos owned and operated by the Mississippi Band of Choctaw Indians, Price Waterhouse Coopers has stepped down, reported the Clarion-Ledger.
A spokesperson for the auditing firm would not comment on why, although the company’s decision coincides with the time FBI agents subpoenaed records from the tribal chief.
On July 12, some 40 FBI agents raided the Mississippi Choctaw’s Pearl River Resort, which includes two gaming facilities: Golden Moon and Silver Star casinos in Choctaw near Philadelphia, Mississippi, and seized hard drives and documents.
The raid came during a turbulent period for tribal leadership. Phyliss J. Anderson would have taken office July 12 in the chief’s $466,000 salary position except for a council vote that negated that election and called for a new one September 6. In the July 5 runoff election, Phyliss J. Anderson was expected to be declared the new Tribal Chief with 1,971 votes to former Chief Beasley Denson’s 1,618 votes. While Denson conceded that day, two days later, the Choctaw Tribal Council cited voting irregularities and negated the results of the June 14 regular election and, thus, the runoff as well.
Another newspaper, The Neshoba Democrat, quoted “multiple sources” as saying the FBI investigation could have been about alleged election fraud.
According to WLBT in Jackson, Mississippi, the raid was “likely” related to Denson and Mercury Gaming of Atlanta, Georgia. Its affiliated marketing arm, The Titan Agency, manages the tribe’s Pearl River Resort. A website report by the station’s Cheryl Lassiter says that sources told her Denson had been paying Mercury Gaming chief executive Doug Pattison $60,000 per month, a amount that increased to $250,000 in February, and tribal council was unaware of these payouts.
Two days following the July 12 raid, Moody’s Investors Service downgraded money borrowed by the Choctaw Resort Development Enterprise, $200 million in securities, to junk bond status, reported the Clarion-Ledger.
The FBI’s investigation may “indicate potential internal control weaknesses and could affect Choctaw’s casino operations in the future,” Moody’s report stated, reported the Clarion-Ledger.
When Anderson and Denson face off again September 6, they will compete against a new candidate who qualified to race, Shirley Berg. “There is a need for a leader who is trustworthy and has integrity to lead the tribe into the future,” Berg told the Clarion-Ledger. “… My vision is to empower the tribe’s legacy of self-determination, bringing the voice of the people back into tribal government.”
Anderson says when she takes office, she will cancel tribe contracts with Mercury Gaming. Recent events “have been difficult for our tribal people,” Anderson said in a statement. “With an overturned election, FBI raid and downgrade of the tribe’s bonds, we have some serious challenges to overcome, no doubt.”
Recently, Chief Beasley Denson has been touring Choctaw communities on his re-election campaign.
The tribe also operates the Hattiesburg, Mississippi-based Bok Homa Casino.
Showing posts with label Golden Moon. Show all posts
Showing posts with label Golden Moon. Show all posts
Monday, August 15, 2011
Sunday, July 31, 2011
Choctaws' bonds get junk rating
Choctaws' bonds get junk rating
Downgrade by Moody's comes on heels of FBI probe
Written by Jerry Mitchell
Two days after FBI agents raided the casinos at the Pearl River Resort, Moody's Investors Service downgraded the $200 million in securities borrowed by the Choctaw Resort Development Enterprise to junk bonds.
On July 12, dozens of FBI agents descended on the casinos near Philadelphia, taking both documents and hard drives.
How the tribe spends its money is under scrutiny by the FBI, which is investigating the relationship between the tribe and the Atlanta-based Mercury Gaming Group and its marketing arm, the Titan Agency.
Miko Beasley Denson, chief of the Mississippi Band of Choctaw Indians, hired Mercury and raised Mercury CEO Doug Pattison's pay in February from $60,000 a month to more than $200,000 a month. Denson told The Clarion-Ledger the raise took place because Pattison was helping with the new Bok Homa Casino.
Denson's challenger, Phyliss J. Anderson, has vowed to cancel tribe contracts with Mercury and Titan. Through a spokesperson, she would not comment Friday.
Moody's wrote in its credit report the FBI's investigation may "indicate potential internal control weaknesses and could affect Choctaw's casino operations in the future."
The service downgraded the bonds from B3 to Caa2, one of the lowest bond ratings possible.
"Obviously the bond rating agencies are watching what has now become a drama unfolding," said Phil Hardwick, coordinator of capacity development for the Stennis Institute of Government.
Earlier this month, Denson lost to challenger Anderson, 1,618 votes to 1,971 for her.
A day after the election, Denson conceded but two days later the Tribal Council threw out the results, alleging there were irregularities. A new election is set for Sept. 6.
As chief, Denson makes $466,000 a year. Anderson and other Tribal Council members earn $120,000 each a year.
Moody's report said "the recent unresolved change in leadership at the Choctaw Tribe - the owner of the casinos - could further complicate the refinancing process or could impede the Enterprise's ability to refinance timely or on economical terms."
(Page 2 of 2)
The bad news hardly ends there. On Nov. 4, the tribe must pay $71 million. The risk of refinancing that amount "has escalated significantly," Moody's wrote.
The service said the bond ratings "could be downgraded further if Moody's deems that the Choctaws will likely not be able to refinance within the next 30 to 60 days."
Because the bonds have been downgraded as junk, the tribe likely will have to look to places besides banks to get refinancing, said Randy Wall, a lawyer for Jackson law firm Watkins Ludlum Winter & Stennis.
In general, it isn't legal for banks to loan money to cover junk bonds, he said. "Banks have to have investment grade ratings."
The tribe could possibly borrow money from insurance companies or private parties, he said.
Hardwick said the Nov. 4 deadline should give the tribe enough time to pay off the $71 million due, "assuming there are no other issues, and assuming they are resolvable. If they don't resolve the issues, that adds to the perceived risk."
Even if they do get financing, "they're going to have to pay a higher interest rate," he added.
Downgrade by Moody's comes on heels of FBI probe
Written by Jerry Mitchell
Two days after FBI agents raided the casinos at the Pearl River Resort, Moody's Investors Service downgraded the $200 million in securities borrowed by the Choctaw Resort Development Enterprise to junk bonds.
On July 12, dozens of FBI agents descended on the casinos near Philadelphia, taking both documents and hard drives.
How the tribe spends its money is under scrutiny by the FBI, which is investigating the relationship between the tribe and the Atlanta-based Mercury Gaming Group and its marketing arm, the Titan Agency.
Miko Beasley Denson, chief of the Mississippi Band of Choctaw Indians, hired Mercury and raised Mercury CEO Doug Pattison's pay in February from $60,000 a month to more than $200,000 a month. Denson told The Clarion-Ledger the raise took place because Pattison was helping with the new Bok Homa Casino.
Denson's challenger, Phyliss J. Anderson, has vowed to cancel tribe contracts with Mercury and Titan. Through a spokesperson, she would not comment Friday.
Moody's wrote in its credit report the FBI's investigation may "indicate potential internal control weaknesses and could affect Choctaw's casino operations in the future."
The service downgraded the bonds from B3 to Caa2, one of the lowest bond ratings possible.
"Obviously the bond rating agencies are watching what has now become a drama unfolding," said Phil Hardwick, coordinator of capacity development for the Stennis Institute of Government.
Earlier this month, Denson lost to challenger Anderson, 1,618 votes to 1,971 for her.
A day after the election, Denson conceded but two days later the Tribal Council threw out the results, alleging there were irregularities. A new election is set for Sept. 6.
As chief, Denson makes $466,000 a year. Anderson and other Tribal Council members earn $120,000 each a year.
Moody's report said "the recent unresolved change in leadership at the Choctaw Tribe - the owner of the casinos - could further complicate the refinancing process or could impede the Enterprise's ability to refinance timely or on economical terms."
(Page 2 of 2)
The bad news hardly ends there. On Nov. 4, the tribe must pay $71 million. The risk of refinancing that amount "has escalated significantly," Moody's wrote.
The service said the bond ratings "could be downgraded further if Moody's deems that the Choctaws will likely not be able to refinance within the next 30 to 60 days."
Because the bonds have been downgraded as junk, the tribe likely will have to look to places besides banks to get refinancing, said Randy Wall, a lawyer for Jackson law firm Watkins Ludlum Winter & Stennis.
In general, it isn't legal for banks to loan money to cover junk bonds, he said. "Banks have to have investment grade ratings."
The tribe could possibly borrow money from insurance companies or private parties, he said.
Hardwick said the Nov. 4 deadline should give the tribe enough time to pay off the $71 million due, "assuming there are no other issues, and assuming they are resolvable. If they don't resolve the issues, that adds to the perceived risk."
Even if they do get financing, "they're going to have to pay a higher interest rate," he added.
Tuesday, July 26, 2011
No details on FBI search at Choctaw casinos
No details on FBI search at Choctaw casinos
Philadelphia, Mississippi (AP) July 2011
A week after the FBI served a search warrant on the Mississippi Band of Choctaw Indians, no one is talking.
The Choctaws are as tightlipped as the FBI about what occurred at the Golden Moon and Silver Star casinos in Neshoba County.
The casinos did not close, Paul Harvey, the chief executive officer of the resort, said in a statement released by the tribe.
“The resort is monitoring the situation closely and will continue to cooperate fully with law enforcement authorities in their investigation. There will be no interruption in the operation of business at the resort,” Harvey said.
The action came a week after the election for chief. The results of the election were tossed out by the Tribal Council. A new election date is pending.
Several news organizations were reporting that the FBI was searching the financial records of the casinos.
FBI spokesman Ty Breedlove in Jackson said the FBI had no comment.
Phyliss J. Anderson, who had defeated Chief Beasley Denson in a runoff that has since been nullified, told the Associated Press that she would not comment on the FBI search.
Pearl River Tribal Council member Cyrus Ben has told the Neshoba Democrat that tribal members “are in the dark as much as you are.”
Tribal Council Vice Chief Kevin Edwards said he had no comment. He said the issue should be addressed by Denson and others in the chief’s administration. No one from the tribe’s main office has returned calls to the AP.
The Neshoba Democrat reported the Choctaw Tribal Council was briefed Tuesday on the FBI investigation. Choctaw Attorney General Donald L. Kilgore told the council they needed to discuss “why the FBI is here.” The meeting adjourned a couple of minutes later.
Philadelphia, Mississippi (AP) July 2011
A week after the FBI served a search warrant on the Mississippi Band of Choctaw Indians, no one is talking.
The Choctaws are as tightlipped as the FBI about what occurred at the Golden Moon and Silver Star casinos in Neshoba County.
The casinos did not close, Paul Harvey, the chief executive officer of the resort, said in a statement released by the tribe.
“The resort is monitoring the situation closely and will continue to cooperate fully with law enforcement authorities in their investigation. There will be no interruption in the operation of business at the resort,” Harvey said.
The action came a week after the election for chief. The results of the election were tossed out by the Tribal Council. A new election date is pending.
Several news organizations were reporting that the FBI was searching the financial records of the casinos.
FBI spokesman Ty Breedlove in Jackson said the FBI had no comment.
Phyliss J. Anderson, who had defeated Chief Beasley Denson in a runoff that has since been nullified, told the Associated Press that she would not comment on the FBI search.
Pearl River Tribal Council member Cyrus Ben has told the Neshoba Democrat that tribal members “are in the dark as much as you are.”
Tribal Council Vice Chief Kevin Edwards said he had no comment. He said the issue should be addressed by Denson and others in the chief’s administration. No one from the tribe’s main office has returned calls to the AP.
The Neshoba Democrat reported the Choctaw Tribal Council was briefed Tuesday on the FBI investigation. Choctaw Attorney General Donald L. Kilgore told the council they needed to discuss “why the FBI is here.” The meeting adjourned a couple of minutes later.
Tuesday, July 12, 2011
FBI raids Choctaw Indian tribe's Pearl River Resort casinos
FBI raids Choctaw Indian tribe's Pearl River Resort casinos
The Birmingham News
NESHOBA COUNTY, Mississippi -- The FBI today raided two Mississippi casinos at the Choctaw Indian tribe's Pearl River Resort, the Jackson Clarion Ledger reports.
The two resorts were identified as the Silver Star Resort & Casino and the Golden Moon Hotel & Casino at Philadelphia, Mississippi. The FBI officials declined to discuss the raids, according to the newspaper.
The Neshoba Democrat reported the Choctaw Tribal Council discussed the raids in morning meeting after barring a reporter. However, statements by one tribal officials indicated the FBI may have targeted computer hard drives.
Resort officials issued a statement saying the resort remained in business but was cooperating with Justice Department officials. If offered no comment on the reasons for the FBI action.
Feds Raid Choctaw Casinos
DOJ Executes Search Warrant
PHILADELPHIA, Miss. -- Federal authorities were at the Golden Moon and Silver Star casinos at Pearl River Resort in Choctaw on Tuesday, 16 WAPT News has learned.
Representatives from the Department of Justice executed a search warrant, according to a statement issued Tuesday afternoon by Pearl River Resort CEO Maj. Gen. Paul Harvey, retired. The agents were seeking records and files, 16 WAPT News reported.
"The resort is monitoring the situation closely and will continue to cooperate fully with law enforcement authorities in their investigation. There will be no interruption in the operation of business at the resort," Harvey said.
A spokesperson with Phyllis Anderson's office of the Mississippi Band of Choctaw Indians Council told the Meridian Star that several employees in the accounting offices had been sent home. Anderson told 16 WAPT News that she didn't have any details about the investigation, but called it unfortunate.
The Choctaw Tribal Council was told on Tuesday that an FBI investigation was under way at Pearl River Resort, the Neshoba Democrat reported.
Roger Anderson, who represents the Conehatta community on the Tribal Council, told 16 WAPT's Scott Simmons that he believes the investigation is financial in nature. He said there are too many questions about money regarding the casinos.
When contacted by 16 WAPT News, the FBI would neither confirm nor deny the investigation.
The Birmingham News
NESHOBA COUNTY, Mississippi -- The FBI today raided two Mississippi casinos at the Choctaw Indian tribe's Pearl River Resort, the Jackson Clarion Ledger reports.
The two resorts were identified as the Silver Star Resort & Casino and the Golden Moon Hotel & Casino at Philadelphia, Mississippi. The FBI officials declined to discuss the raids, according to the newspaper.
The Neshoba Democrat reported the Choctaw Tribal Council discussed the raids in morning meeting after barring a reporter. However, statements by one tribal officials indicated the FBI may have targeted computer hard drives.
Resort officials issued a statement saying the resort remained in business but was cooperating with Justice Department officials. If offered no comment on the reasons for the FBI action.
Feds Raid Choctaw Casinos
DOJ Executes Search Warrant
PHILADELPHIA, Miss. -- Federal authorities were at the Golden Moon and Silver Star casinos at Pearl River Resort in Choctaw on Tuesday, 16 WAPT News has learned.
Representatives from the Department of Justice executed a search warrant, according to a statement issued Tuesday afternoon by Pearl River Resort CEO Maj. Gen. Paul Harvey, retired. The agents were seeking records and files, 16 WAPT News reported.
"The resort is monitoring the situation closely and will continue to cooperate fully with law enforcement authorities in their investigation. There will be no interruption in the operation of business at the resort," Harvey said.
A spokesperson with Phyllis Anderson's office of the Mississippi Band of Choctaw Indians Council told the Meridian Star that several employees in the accounting offices had been sent home. Anderson told 16 WAPT News that she didn't have any details about the investigation, but called it unfortunate.
The Choctaw Tribal Council was told on Tuesday that an FBI investigation was under way at Pearl River Resort, the Neshoba Democrat reported.
Roger Anderson, who represents the Conehatta community on the Tribal Council, told 16 WAPT's Scott Simmons that he believes the investigation is financial in nature. He said there are too many questions about money regarding the casinos.
When contacted by 16 WAPT News, the FBI would neither confirm nor deny the investigation.
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