Joe Nelson, Staff Writer
Posted: 05/10/2012 04:08:26 PM PDT
The 48-count indictment, filed Wednesday in U.S. District Court in Los Angeles, names as defendants attorney Gary Edward Kovall, 66, of Ely, Minn., Rancho Cucamonga general contractor Paul Phillip Bardos, 57, David Alan Heslop, 74, of Templeton and Peggy Anne Shambaugh, 56, also of Ely.
The four are accused of participating in a scheme in which associates of Kovall, who represents the Twentynine Palms tribe, paid him kickbacks in exchange for securing work for the tribe, according to a news release from the U.S. Attorney’s Office.
According to the indictment, the tribe, under Kovall’s advisement, created a limited liability company to purchase real estate. Kovall convinced the tribe to hire Heslop as the company’s manager, then Kovall and Heslop convinced the tribe to hire Bardos for several construction projects at the Spotlight 29 Casino in Coachella, authorities said.
When additional construction projects became necessary, Kovall persuaded the tribe to grant Bardos the contracts. After being paid by the tribe, Bardos paid kickbacks to Heslop who, in turn, paid kickbacks to Kovall through Shambaugh, according to the indictment.
In 2007, Bardos allegedly paid Heslop more than $186,577, most of which was then funneled to Shambaugh, according tothe indictment.
All four defendants are charged with conspiracy. Kovall, Bardos and Shambaugh are also charged with eight counts of bribery, and Heslop is charged with 16 counts of bribery. Bardos also faces eight counts of money laundering and Heslop seven counts of money laundering. Shambaugh is also charged with two counts of money laundering.
Steven Martinez, assistant director of the FBI’s Los Angeles field office, said in a statement Thursday that the defendants deprived the Twentynine Palms tribe of honest leadership by “lining their own pockets with the tribe’s money, including government funding designated for necessary services.”
Darrell Mike, chairman of the Twentynine Palms Band of Mission Indians, did not respond to a request for comment Thursday.
“The United States Attorney’s Office is committed to the prosecution of corruption and fraud in all of their guises,” U.S. Attorney Andre Birotte Jr. said in a statement. “This case demonstrates that our commitment extends to vigorously pursuing cases against unscrupulous individuals who abuse their positions to take advantage of Native American tribes.”
Kovall, Heslop, Bardos and Shambaugh face anywhere from 75 to 225 years in prison if convicted and fines ranging from $2million to $5.75 million.
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