Ex-tribal official goes on trial for allegedly false statements

By Clair Johnson

The Gazette Staff

A former Crow tribal official convicted in a corruption case in the 1990s lied about his ability to pay restitution even though he was receiving hundreds of thousands of dollars to develop minerals on the Crow Reservation, a federal prosecutor told a jury Monday.

Theodore Jon Hogan, 61, a Crow tribal member and resident of Sedona, Ariz., gave the government "a sob story" on how tough his life was and "pleaded poverty" when officials tried to determine his resources to create a plan to pay $35,100 in restitution, said Robert Mandel, a special prosecutor from the U.S. Attorney's Office in South Dakota. The Montana U.S. Attorney's office recused itself from the case because it became responsible for collecting the restitution.

Hogan, who has a consulting business, Theodore J. Hogan and Associates LLC, transferred an estimated $700,000 to his wife, Christina Damitio, Mandel said. Meanwhile, restitution payments of $50 to $100 dribbled into the U.S. Attorney's Office over the years, he said. Hogan completed his restitution with an $18,550 payment last February.

One of the government's first witnesses was Crow Tribal Chairman Carl Venne, who described agreements he entered both as an individual and as the tribal chairman with Hogan to develop minerals, including coal and coalbed methane.

Hogan was indicted last April on three counts of false statements. The indictment alleges that in 2001, 2003 and 2005, Hogan knowingly gave false information to the Department of Justice on financial forms and in a response to a series of questions from the agency. Hogan signed the forms certifying he was being truthful under penalty of prosecution if he lied.

Hogan faces five years in prison and a $250,000 fine if convicted.

The government says Hogan concealed his ownership in his business, bank accounts, creditors and gifts exceeding $500 he made to others.

A federal jury convicted Hogan in 1990 of conspiracy and bank fraud charges. Senior U.S. District Judge Jack Shanstrom, who is presiding over Hogan's current trial, sentenced Hogan to two years in prison, two years of supervised release and ordered restitution to the Crow Tribe. At the time of trial, Hogan was executive director of the Crow Tribal Housing Authority and had served six years as tribal secretary.

Hogan's attorney, Palmer Hoovestal of Helena, said Hogan made no false statements.

Hogan was struggling to put his life back together after prison and was not making any money, he said. Money Hogan received for potential mineral development projects was invested into the projects and paid for "overhead," Hoovestal said. Hogan will testify that he never received a salary and that the money wasn't his, he told the jury.

In opening statements, Mandel said Hogan made little progress paying restitution while on supervised release. When Hogan finished his supervision, he left the area. Federal officials located Hogan in Sedona, where he owned a tour company called Way of the Ancients.

The U.S. Attorney's Office located an undisclosed bank account in 1999 with about $12,000 and garnished it, Mandel said. Hogan "pleaded poverty" and the government agreed to release all but $3,000 to Hogan to run his business, he said.

Beginning in about 2001, people began investing or loaning Hogan hundreds of thousands of dollars for investments in mineral development on the Crow Reservation, Mandel said. Some gave Hogan "huge amounts," and records indicate that "a couple million (dollars) went through his hands," he said.
Hogan did "everything in his power to conceal information" and to stymie collection efforts, Mandel said.

Venne testified that he has known Hogan all his life. Despite Hogan's prior convictions, Venne said he trusted Hogan enough to enter minerals development agreements with him for his own mineral interests and as chairman for tribal minerals interests.

Venne and his siblings signed an agreement in December 2001 with Hogan for development of their minerals, he said. Hogan paid him a $100 signing bonus and $75 per acre. As chairman, Venne signed another agreement in January 2003 giving Hogan exclusive rights to seek developers on behalf of the tribe.

Venne revoked the exclusive agreement in 2005, he said, because Hogan hadn't delivered on bringing in any large developers.
Mandel asked Venne whether he thought Hogan had breached a provision that said Hogan could not obligate the tribe to anything without the chairman's approval.

"I, probably, yes," Venne answered.

Venne also said he rescinded the agreement because of information that Hogan was receiving money from investors, although he wasn't sure of that himself.

The trial continues today.