The Trump administration and congressional Republicans are rightly focused on rooting out waste, fraud, and abuse in taxpayer-funded programs. But in their search for bad actors who are bilking the public for billions of dollars, the White House and Congress shouldn’t only focus on famously porous welfare programs such as Medicaid and food stamps.
They should also pay close attention to funding for Indian tribes. A California lawsuit illustrates the widespread misuse of taxpayer money in communities that are often — and wrongly — treated as politically untouchable.
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At this moment, the Pechanga tribe is suing the Trump administration for refusing to enter into a compact and funding agreement to help pay for an opioid treatment center 30 miles from its reservation. The tribe has told the court that it stands for “self-determination” and is determined to “strengthen” its “economic self-sufficiency.” But it also wants taxpayers to help foot the bill for the healthcare facility, via the Indian Health Service. This is exactly the kind of double-talk that ought to concern anyone worried about waste, fraud, and abuse.
FUND THE IRAN WAR BY ENDING WELFARE FRAUD
Both claims can’t be true: Either the tribe wants to be self-sufficient, or it needs federal funding. Meanwhile, the Pechanga tribe operates one of the most lucrative casino gaming operations in California. Local researchers have found that its “gaming and resort revenues have allowed the tribe to effectively eliminate its reliance on other governments.” The revenue is so significant that tribal members have been known to receive monthly checks of up to $10,000. The tribe’s current claims that it needs taxpayer dollars should be met with the strongest suspicion.
Does this single lawsuit really indicate a broader trend in tribal communities? The unfortunate answer is absolutely.
In 2024, even the Biden administration effectively admitted that waste, fraud, and abuse are enormous problems in tribal funding programs. The Government Accountability Office estimated that Congress approved nearly $33 billion for tribal communities that year alone. But the GAO also declared that “funding and programs meant to help tribes may not be reaching them.” Since it was the Biden era, the GAO tried to chalk this up to barriers blocking tribes from accessing money — a tacit attempt to claim systemic racism. In reality, bad actors are skimming money off the top.
There are almost too many examples to count. In recent years, the Department of Homeland Security discovered that an Indian tribe in Nebraska and Iowa spent nearly $14 million in disaster relief funds with nothing to show for it. The money disappeared because the tribe “failed to comply with federal procurement regulations.” In Montana, a tribal college was accused of false reports to keep federal grant money flowing into its coffers. Three years ago, in Wisconsin, a tribal community health center fired a senior employee. She claimed to have expressed concerns that the center was improperly billing federal health programs. The abuse of federal healthcare funding is a common theme on reservations.
Then there’s the Small Business Administration, which offers a multibillion-dollar “business development program” that gives tribes preferential access to federal contracts and training. Federal investigations have found that the program has no procedure for verifying whether applicants are federal or state-recognized tribal members, as required by law. Lo and behold, fraud and abuse have abounded.
Last year, a private investigation alleged massive fraud at ATI Government Solutions, which is majority-owned by a federally recognized Indian community in California. The investigators argued that the company had obtained more than $100 million in no-bid contracts, only to funnel money to other groups. The SBA has since suspended ATI Government Solutions from participating in its programs.
In another apparent case of fraud, a whistleblower alleged that the Hawaiian Native Corp. bilked the same program. The nonprofit organization was supposed to serve native Hawaiians — hence its name — but instead it funneled millions of dollars toward its owner’s lavish lifestyle, including private jets, Porsches, luxury homes, and even horse breeding in Argentina. Elsewhere, federal prosecutors have pursued a $30 million bribery scandal in the program, securing four guilty pleas.
Whether it’s the Small Business Administration, the Indian Health Service, or the alphabet soup of federal grant programs, billions of taxpayer dollars are going to tribal communities and organizations. Yet so much of this money lacks sufficient guardrails and oversight, guaranteeing that huge amounts of federal funds are being misspent. Courts have also (and wrongly) held that Indian tribes and organizations are largely immune from the False Claims Act, a federal law that incentivizes whistleblowers to come forward and even profit from doing the right thing. Without that incentive, widespread theft continues.
The White House and Congress should clean up this mess, and the first step is clarifying that the False Claims Act applies to Indian tribes and organizations. Waste, fraud, and abuse have been allowed to fester in tribal communities for far too long. For the sake of taxpayers, the political class should tolerate this theft no longer.
Chase Martin is chairman of American Resolve.
