Five plead guilty in Blackfeet fraud case

Po’ka Project was intended to help troubled Blackfeet children

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One of six administers of a federal program intended to help troubled and at-risk children on the Blackfeet Indian Reservation has been sentenced in connection with a wire fraud case. Four co-defendants have pleaded guilty, and a sixth has pleaded not guilty.

The six individuals were indicted last August on a total of 21 separate wire fraud counts, along with charges of theft, embezzlement, tax evasion and money laundering.

According to U.S. Attorney for Montana Michael Cotter, the indictments followed a two-year investigation by the Guardians Project, a cooperative effort created in 2011 between the Department of the Interior, the Federal Bureau of Investigation and the Internal Revenue Service.

The indictment filed in U.S. District Court in Great Falls alleged that the six committed crimes while administering and reporting for the Blackfeet Po’ka Project, also known as the Blackfeet Children System of Care.

The Po’ka Project was initially funded with a $1 million grant in 2005 by the Substance Abuse and Mental Health Services Administration. The grant was renewed for six years with another $9 million. The Centers for Medicare & Medicaid Services also provided $300,000.

Much of the indictment is connected to fraudulent claims related to the Tribe’s in-kind or matching contributions allegedly made in an effort to maximize federal funding, Cotter said. The indictment alleges that the six individuals fabricated records and made material misrepresentations about the Tribe’s contributions.

U.S. Assistant U.S. Attorney Carl Rostad said that as part of the plea agreement, he intends to seek $1 million in restitution from each defendant. The six named individuals included:

• Charlotte B. New Breast, 53, of Browning, had served as an administrative assistant for the Po’ka Project and 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. U.S. District Court Judge Brian Morris sentenced New Breast on Jan. 16 to three years probation, $50,000 in restitution and a special assessment of $100.

• Gary Joseph Conti, 67, of Three Forks, a former professor at Oklahoma State University and the national monitor for the Po’ka Project grant and program, initially faced 19 counts. He has pleaded not guilty and has a March 4 trial date scheduled.

• Francis Kay Onstad, 61, of Valier, a former director of the Po’ka Project, initially faced 32 counts. Onstad pleaded guilty to conspiracy, embezzlement, fraud, income tax evasion, conspiracy to violate the false claims act and theft from an Indian tribal government on Feb. 28 and faces up to 15 years if the sentences are run consecutively.

• Delyle Shanny Augare, 58, of Browning, a former assistant director of the Po’ka Project, initially faced 22 counts. Augare pleaded guilty to conspiracy, embezzlement, fraud, income tax evasion, conspiracy to violate the false claims act and theft from an Indian tribal government on Feb. 28. He faces up to 15 years if the sentences are run consecutively.

• Dorothy May Still Smoking, 64, of Browning, the former local evaluator for the Po’ka Project and a consultant working for Conti, initially faced 25 counts. She pleaded guilty to conspiracy, embezzlement, fraud and conspiracy to violate the false claims act on Feb. 28.

• Katheryn Elizabeth Sherman, 66, East Glacier, the former in-kind coordinator for the Po’ka Project, initially faced 25 counts. She has reached a plea agreement and is scheduled to enter a plea before Judge Morris on March 3.

In a separate federal fraud case on the Blackfeet Indian Reservation, Sandra Marie Sanderville, 58, of Browning, pleaded guilty to embezzlement and fraud before U.S. Magistrate Judge Keith Strong on Feb. 27 in U.S. District Court in Great Falls.

Sanderville, the former director of the Blackfeet Tribe’s Temporary Assistance to Needy Families program, allegedly overpaid 16 to 20 TANF beneficiaries a total of $297,612 between 2006 and 2010.

She also allegedly tried to delete and destroy computer files once she learned she was under investigation by the Tribe’s Internal Affairs Office. She later admitted to having a gambling problem and losing hundreds of dollars each week.

Sanderville faces up to 10 years in prison and a $250,000 fine. U.S. Assistant U.S. Attorney Carl Rostad told the court Feb. 27 that he will seek $297,000 in restitution.