Allegations » Tribal members claim the COO used funds for extravagant personal purchases.
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Brigham City » The Northwestern Band of the Shoshone tribal council Saturday suspended the top two executives of the tribe's economic development company after a company accountant leveled allegations of embezzlement, tax fraud and corporate mismanagement.
Among the allegations are that Chief Operating Officer Mike Devine has been reimbursed for nonbusiness expenses, such as his mortgage and his daughter's LDS mission expenses, and that executives spent lavishly on travel, ringing up $163,000 on airline tickets, dining, entertainment and motels in the past year.
The council wanted to suspend only Devine, but Chief Executive Officer Bruce Parry insisted he be suspended, too, while the allegations are investigated by law enforcement. "I'm ultimately responsible," Parry said. He remains on the tribal council, but has resigned his chairmanship. Gwen Davis was elected chairwoman. Devine is not a member of the tribe.
Devine denied all the allegations and Parry backed him up. "I'm absolutely certain we'll withstand any scrutiny," Devine said.
The move came at the end of an emotional, seven-hour meeting in which Parry's four children, grandchildren and wife of 50 years accused Devine of stealing from the tribe's company and hoodwinking Parry into believing he has the tribe's interest at heart.
At one point, grandson Blake Ross asked his grandfather whether his loyalty to Devine is worth alienating his family. "Grandpa ... pick our side, please."
About 40 tribal members attended the meeting, many of them traveling long distances. "It makes me sick," said Sandra Heaton, of Cedar City. "We started with nothing, and we still have nothing except a few people benefitting."
The Northwestern Band, based in Brigham City, has about 500 members.
In 2003, the council set up NWB Economic Development to pursue business ventures from its Salt Lake City office.
Devine runs the business. Its subsidiaries are involved in construction and translation work for the government as well as development of geothermal projects in southern Idaho and northern Utah. The latter have yet to secure financing.
According to the federal Web site, usaspending.gov, the company, through subsidiary NWB Technology, has had more than $28 million in federal contracts since 2004, although the value of contracts dropped dramatically in fiscal 2009.
The allegations were detailed Saturday by one of Parry's grandsons, Chase Parry, an accountant who joined NWB Economic Development in August and said he found it struggling to pay vendors. Many are threatening lawsuits for nonpayment, he said.
He said he has already contacted the federal Small Business Administration and state and federal tax authorities. Other tribal members said they intend to go to the FBI.
Among his disclosures were that Devine signed a $15,000 check made out in his own name in September. An attached invoice said the money was for Devine's mortgage, his daughter's mission expenses and for household utilities, Chase Parry said.
Devine said the invoice was a household budget that was erroneously placed with other papers detailing personal expenses charged to credits cards that he uses for business and personal expenses.
"I don't expect the tribe to pay for my daughter's mission," he said.
Chase Parry said many of the problems stem from Devine using personal credit cards, having the company pay the balance and then reimbursing for his personal share.
Among charges the company paid were an Xbox subscription; a bill at the Utah State Liquor Store; $3,300 for Broadway and Las Vegas shows; $13,000 for meals; and $1,300 for miscellaneous expenses in bookstores and airport gift shops, he said.
The company bought $6,000 worth of tickets to last year's Utah-Brigham Young University football game and $600 worth of tickets to the Utah-Oregon game that went unused this year, Chase Parry said.
"As a tribal member, it's hard for me to see them spending this kind of money when we can't pay our vendors," he said.
Devine said many of those were legitimate business entertainment expenses, but some personal expenses -- including $3,000 for Broadway tickets -- apparently were missed when he repaid the company for personal expenses.
"We're not saying there weren't mistakes," Devine said. "We're saying there weren't any crimes," Devine said.
At one point, Parry family friend Rulon Gardner, a developer, said he regretted giving NWB Economic Development a $250,000 loan when, a day later, a $50,000 car materialized. Parry family members said Devine bought an SUV.
Devine contended the money was not a loan but the first installment of an investment in a tribal-owned casino on the Idaho border, a venture that never materialized.
Parry said "not a penny" of the tribe's money has ever gone into the company.
Devine, on the other hand, has put hundreds of thousands of dollars into the company, Parry said.
"If you get rid of me, lucky you. You've got millions of dollars of assets you didn't pay for," Devine told tribal members, who scoffed at much of what he had to tell them.
Divine has an agreement with the company to be paid $250,000 a year, but has agreed to smaller paychecks, Parry said. Last year, Devine was paid $180,000, he said.