An Ottawa County tribe said it is taking steps to recover millions it claims was taken illegally by a former casino management company.
The Peoria Tribe of Indians of Oklahoma, which operates Buffalo Run Casino and Resort in Miami, Oklahoma, pledged to work with the National Indian Gaming Commission and federal authorities to ensure compliance with laws and the agency’s rules and regulations after it was discovered that Direct Enterprise Development LLC reportedly took $2 million in management fees.
Peoria Tribe Chief Craig Harper explained such actions disregarded specific NIGC directions to calculate the fees, which prompted the commission to submit a notice of violation report to the tribe last month in response to the infractions that were in violation of the Indian Gaming Regulatory Act.
The NIGC also found that David J. Qualls and Tony D. Holden — officers with Tulsa-based Direct Enterprise Development — “wrongfully enriched themselves and their company” to calculate the fees in a different manner dating back to 2005 by managing without a contract and improperly using gaming revenue.
The NIGC claimed in its report that the tribe and Direct Enterprise Development modified the terms of their contractual agreement to increase the management company’s fee. As recent as 2017, the commission said it found modified calculations that resulted in an overstatement of net gaming revenue that exceeded $7.3 million and overpayments of management fees that ran approximately $2,067,561. Direct Enterprise Development has not paid back the excess management fees, NIGC said.
The report indicated that from fiscal year 2010 through fiscal year 2017, Direct Enterprise Development allegedly directed the distribution of gaming revenue to other parties before the tribe received its share. On 64 different occasions, NIGC alleged distributions of gaming revenue were wired directly into the personal bank accounts of Holden and Qualls.
“The Peoria Tribe had no control over the calculation and payment of the management fees or the other wrongful payments,” Harper said. “That was all under the sole control of Qualls and Holden.”
Neither Qualls nor Holden is a member of the Peoria Tribe, Harper said.
“The Peoria Tribe takes these issues seriously and we will cooperate fully with the NIGC and other federal authorities to resolve its concerns related to these events,” Harper said.
The Peoria Tribal Gaming Commission said it previously made similar findings of impropriety related to Qualls and Holden in its dealings. Based on those discoveries, it revoked the gaming licenses of Qualls and Holden and issued a $2 million fine against them.
The NIGC said the tribe has terminated its contract with Direct Enterprise Development and has stopped unapproved modifications to the management agreement.
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The Peoria Tribe’s appeal of the NIGC’s notice is pending.