Jury convicts professor in Blackfeet fraud case
Po’Ka Project was intended to help troubled Blackfeet children
One of six administers of a federal program intended to help troubled and at-risk children on the Blackfeet Indian Reservation was convicted of 26 of 27 counts of public corruption by a federal jury in Great Falls on May 22.
Gary Joseph Conti, 68, of Three Forks, a retired Oklahoma State University professor, was found guilty of 21 counts of scheming to defraud the U.S. government and the Blackfeet Tribe, and one count each of theft of federal property, false claims, theft from an Indian tribal government receiving federal grant money, and money laundering.
Conti faces up to 20 years and a $250,000 fine for each of the 21 wire fraud counts. U.S. District Court Judge Brian Morris has scheduled sentencing for Sept. 4. Conti is expected to appeal.
Following a four-day trial, the jury found Conti not guilty of one fraud charge. An earlier jury convicted Conti of one count of bankruptcy fraud on March 7 but couldn’t reach a verdict on the remaining 27 counts of the indictment. Morris declared a mistrial, and U.S. Assistant Attorney Carl Rostad asked the court to set the case for re-trial.
“Grants like Po’Ka reflect the generous spirit of this country to help the least fortunate among us,” U.S. District Attorney Mike Cotter said. “When a group of predatory opportunists see these grants as a golden goose ready to be exploited for personal gain, this office will respond with clear and decisive prosecution as a message to all that corruption in any community in Montana will not be tolerated, and that those who pillage public funds had best factor dire consequences into their decision to commit fraud.”
The Blackfeet Po’Ka Project received about $9.3 million in federal grant money from the Substance Abuse and Mental Health Services Administration from 2005 through 2011.
The SAMHSA grant required that the Blackfeet Tribe make the Po’Ka Program self-sufficient — a completely tribal program entirely supported by the Tribe by the end of the grant period.
To achieve that goal, the Tribe was required to provide matching contributions — either cash or in-kind — with the idea that as federal participation declined, tribal participation would rise to fill the funding void left by the absence of federal funds.
According to a press release by Rostad, “Evidence produced at trial revealed that the in-kind commitment could never be honestly met, so the conspirators began making up facts and documents to try and satisfy SAMHSA and the auditors that the in-kind contributions represented on their reports to SAMHSA were legitimate.”
This was accomplished by inflating figures related to in-kind contributions, assigning values to nonexistent and illegitimate “contributions,” and creating fraudulent invoices and records to support fictional or inflated contributions.
“E-mails entered into evidence by the prosecution indicated that Conti was often consulted for advice as to how to appease auditors hired by the Tribe to perform a mandatory audit,” Rostad’s press release stated.
Auditors with the Office of Inspector General and the U.S. Department of Health and Human Services determined that at least $4.6 million in claims for grant payments paid to the Tribe on the basis of Po’Ka’ s in-kind contribution were unsupported, inflated or completely falsified.
Conti’s attorney, Joshua Van de Wettering, claims the fraud was perpetuated by two other Po’Ka Project administers — tribal leaders Francis Onstad and Delyle “Shanny” Augare.
One of the administers was sentenced on Jan. 16. Charlotte B. New Breast, 53, of Browning, initially faced 23 counts. She pleaded guilty to a single count of theft from an Indian tribal government receiving federal grant funds on Oct. 21. Judge Morris sentenced her to three years probation, $50,000 in restitution and a special assessment of $100.
Four co-defendants have pleaded guilty. Onstad, Augare and Dorothy May Still Smoking are scheduled for sentencing on June 5. Katheryn Sherman is scheduled for sentencing on June 6.