Tribe Says Embezzlers Took Millions

     SACRAMENTO (CN) - Former officials of the Paskenta Band of Nomlaki Indians embezzled millions of dollars from the tribe and then destroyed casino records in a cyberattack, the tribe claims in Federal Court.
     The tribe sued 18 defendants - 12 people and six business - and focuses on four officials it calls the "RICO ringleaders", including John Crosby, former tribal economic development director and former FBI agent.
     It claims the four leaders used vote-rigging, bribery and extortion to take control of the tribe and its principal non-casino business entity during a far-reaching, decade-long scheme, plaintiffs' attorney Stuart Gross said in a statement.
     According to the 171-page lawsuit, the RICO ringleaders embezzled $20 million in retirement and nonretirement funds, including $954,000 paid to Crosby's wife for administrative services in a single year. The Crosbys also bought an $800,000 luxury home and a $93,000 Mercedes with money directly from the tribe's bank account, according to the March 10 complaint.
     The defendants also bought a private jet with the tribe's money, according to the complaint. The tribe claims defendants Leslie and Larry Lohse spent $17 million on the jet they used to transport their son, Kyle Lohse, who was a pitcher for the St. Louis Cardinals at the time.
     The Paskenta Band operates Rolling Hills Casino in Corning, 100 miles north of Sacramento. The casino provides about $50,000 a year to each member of the Tribe. After 15 years of financial control, the so-called RICO ringleaders were voted out by the tribe in April 2014.
     "Since April 2014, the duly elected members of the Tribal Council have been hard at work both cleaning up the mess the defendants left behind and searching for the money stolen from the Tribe," tribal counsel Andrew Purdy in a statement. "The defendants' actions are made all the worse in that these four did not keep a paper trail of their grossly extravagant spending. They knew that their actions were criminal, and they wanted no proof of their crimes."
     A month after being fired by the Tribe, the RICO ringleaders remotely connected to the casino network and erased all of the information from the servers, the complaint states. The lost information is believed to have contained data that incriminated the defendants.
     The tribe's complaint is built on the results of an investigation conducted by the WilmerHale law firm, which concluded that the tribe indeed had millions of dollars stolen from its bank accounts.
     A former FBI director and a former U.S. Deputy Attorney General were part of the WilmerHale investigations team that recommended that the tribe hire counsel to recover misappropriated assets, Gross said.
     The defendants could not be reached for comment.