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House Panel Moves to Limit Probe Into Indian Trust Fund

John J. Fialka, Staff Reporter
The Wall Street Journal, July 25, 2002

WASHINGTON -- The House Appropriations Committee moved to limit a historic, court-ordered accounting for what are alleged to be multibillion-dollar errors in payments to Indians through a trust fund managed by the Interior Department.

While a federal judge has ordered the department to do an accounting of the trust fund going back to the 19th century, when it originated, the House committee says it will provide funds for only a search of computer records, which go back to 1985. Interior had estimated that the larger search would cost $2.4 billion.

A committee aide, who asked not to be identified, said members felt the larger search was "not cost effective." The narrower search, the aide said, could cost as much as $1 billion. As part of an amendment to the appropriation bill, the committee also acted to limit fees paid by the government to two special masters monitoring the Interior Department's actions in the case for Judge Royce C. Lamberth of the federal district court here.

The appropriation bill, which must be approved by the House and Senate, would also pay legal fees for a number of current and former government officials charged with contempt of court in the tangled case, including Interior Secretary Gale Norton and former Interior Secretary Bruce Babbitt.

The Indians' class-action lawsuit claims they may be owed as much as $10 billion for alleged errors, fraud and losses in trust funds, which kept money for individual Indians as part of a government-run banking system on reservations. Judge Lamberth has already ruled that the Interior Department has violated its fiduciary duties as trustee. The remaining question is how much may be owed to individuals who had accounts in the trust fund.

Eloise Cobell, the lead plaintiff in the case, called the House Appropriations Committee's limitation a "naked abuse of power" initiated by the Bush administration to protect "corrupt activities" of public officials. Interior spokesman Eric Ruff said the committee's action was self-initiated. "We didn't make the request." Interior's lawyers have complained that the "magnitude of the historical accounting is enormous," because the trust fund has handled at least $13 billion according to records that go back to 1909. The amendment goes before the House Rules Committee Monday, where it may face opposition from members of other committees that deal with Interior Department matters.

John J. Fialka, Staff Reporter
House Panel Moves to Limit Probe Into Indian Trust Fund
The Wall Street Journal, July 25, 2002

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