Interior secretary held in contempt for trust fund mess

A federal judge on Tuesday held Interior Secretary Gale Norton in contempt of court for failing to reform the agency's Indian trust fund system.

U.S. District Court Judge Royce Lamberth held Norton and Assistant Secretary of Indian Affairs Neal McCaleb in contempt, ordering them to pay legal fees for the plaintiffs and the cost of appointing a court monitor to oversee future reforms of the accounting system. Lamberth accused the two officials of delaying reforms and misleading the court about progress on a plan to fix accounting errors and security problems with online trust information. Lamberth's decision about whether to hold Norton and McCaleb in contempt has been pending since February.

"The recalcitrance exhibited by the Department of Interior in complying with the orders of this court is only surpassed by the incompetence that the agency has show in administering the IIM [Individual Indian Money] trust," Lamberth wrote in his 267-page ruling.

Interior's Bureau of Indian Affairs is responsible for sending checks to Indian trust beneficiaries who rely on trust funds for basic living necessities. Currently, the BIA manages about 1,400 tribal accounts and 300,000 individual trust accounts, which were set up more than a century ago to compensate Indians for the use of their land. Allegations of mismanagement of the BIA trust accounting system culminated in a 1996 lawsuit filed against Interior by Elouise Cobell, founder and current chair of the Blackfeet National Bank.

In February 1999, Lamberth held then-Secretary of the Interior Bruce Babbitt; his assistant secretary for Indian affairs, Kevin Gover; and former Treasury Secretary Robert Rubin in contempt of court for failing to produce records relating to the Cobell case.

In his Sept. 17 decision, Lamberth also declined Cobell's request for a court-appointed receiver to manage reform efforts, which would take responsibility for the needed reforms away from the agency. Lamberth ordered Norton and McCaleb to present plans to bring the department into compliance with court orders by Jan. 6, and set the date for the next phase of the trial for May 2003.

The Interior and Justice departments issued a joint statement criticizing the ruling. "We disagree with the court's decision and are evaluating it to consider all of the options for appeal," said Robert McCallum Jr., assistant attorney general in Justice's Civil Division.

"This administration has done more to fix a very broken trust management system than any previous administration in history," the statement said. The statement also argued that portions of Lamberth's ruling are based on actions taken by officials in the previous administration.

Stay up-to-date with federal news alerts and analysis — Sign up for GovExec's email newsletters.
Close [ x ] More from GovExec

Thank you for subscribing to newsletters from
We think these reports might interest you:

  • Sponsored by Brocade

    Best of 2016 Federal Forum eBook

    Earlier this summer, Federal and tech industry leaders convened to talk security, machine learning, network modernization, DevOps, and much more at the 2016 Federal Forum. This eBook includes a useful summary highlighting the best content shared at the 2016 Federal Forum to help agencies modernize their network infrastructure.

  • Sponsored by CDW-G

    GBC Flash Poll Series: Merger & Acquisitions

    Download this GBC Flash Poll to learn more about federal perspectives on the impact of industry consolidation.

  • Sponsored by One Identity

    One Nation Under Guard: Securing User Identities Across State and Local Government

    In 2016, the government can expect even more sophisticated threats on the horizon, making it all the more imperative that agencies enforce proper identity and access management (IAM) practices. In order to better measure the current state of IAM at the state and local level, Government Business Council (GBC) conducted an in-depth research study of state and local employees.

  • Sponsored by Aquilent

    The Next Federal Evolution of Cloud

    This GBC report explains the evolution of cloud computing in federal government, and provides an outlook for the future of the cloud in government IT.

  • Sponsored by Aquilent

    A DevOps Roadmap for the Federal Government

    This GBC Report discusses how DevOps is steadily gaining traction among some of government's leading IT developers and agencies.

  • Sponsored by LTC Partners, administrators of the Federal Long Term Care Insurance Program

    Approaching the Brink of Federal Retirement

    Approximately 10,000 baby boomers are reaching retirement age per day, and a growing number of federal employees are preparing themselves for the next chapter of their lives. Learn how to tackle the challenges that today's workforce faces in laying the groundwork for a smooth and secure retirement.

  • Sponsored by Hewlett Packard Enterprise

    Cyber Defense 101: Arming the Next Generation of Government Employees

    Read this issue brief to learn about the sector's most potent challenges in the new cyber landscape and how government organizations are building a robust, threat-aware infrastructure

  • Sponsored by Aquilent

    GBC Issue Brief: Cultivating Digital Services in the Federal Landscape

    Read this GBC issue brief to learn more about the current state of digital services in the government, and how key players are pushing enhancements towards a user-centric approach.

  • Sponsored by CDW-G

    Joint Enterprise Licensing Agreements

    Read this eBook to learn how defense agencies can achieve savings and efficiencies with an Enterprise Software Agreement.

  • Sponsored by Cloudera

    Government Forum Content Library

    Get all the essential resources needed for effective technology strategies in the federal landscape.


When you download a report, your information may be shared with the underwriters of that document.