MADISON, WI—John W. Vaudreuil, United States Attorney for the Western District of Wisconsin, announced that Timothy Whiteagle, 61, Black River Falls, Wisconsin, was sentenced today by Chief U.S. District Judge William M. Conley to 10 years in federal prison for his central role in a bribery and scheme involving contracts awarded by the Ho-Chunk Nation. He was also ordered to serve three years of supervised release following his prison sentence and to pay $162,854 in taxes to the IRS.
On August 1, 2012, following a jury trial on bribery, tax, and obstruction charges, Whiteagle was convicted on all 12 counts.
According to the evidence presented at the trial, the Ho-Chunk Nation, an Indian tribal government, operates casinos in the Western District of Wisconsin and annually receives federal grants well in excess of $10,000. Whiteagle is a Ho-Chunk tribal member. From 2002 to 2009, Whiteagle, at times with the assistance of Deborah H. Atherton, 55, Black River Falls, acted covertly as a behind-the-scenes consultant for clients seeking to do business with the Ho-Chunk Nation. The clients included companies that provided cash access services (such as check cashing and ATMs) at Ho-Chunk casinos and a company that sought to provide mortgages and housing for tribal members. Whiteagle received over $3 million dollars from the clients.
Whiteagle gave Clarence Pettibone, an elected legislator of the Ho-Chunk Nation, money and valuables, and Whiteagle and Atherton solicited clients seeking Ho-Chunk business to do the same. The valuables included checks; money orders; payments to a martial arts studio operated by Pettibone; a Pontiac Firebird; contributions for Pettibone’s re-election campaign; a job for a relative of Pettibone; golf outings; tickets to an NFL football game; visits to adult entertainment venues; auto body work on a car owned by a relative of Pettibone; and vacations for Pettibone and his family members.
Whiteagle and Atherton offered and gave the money and valuables to Pettibone to influence and reward him for helping certain clients do business with the Nation. Pettibone knew the money and valuables were given to him to influence and reward him for assisting the clients. Whiteagle and Pettibone consulted with each other about how to use Pettibone’s official position to assist the clients in obtaining and keeping contracts with the Ho-Chunk Nation; and Pettibone, in his official capacity as an elected legislator, took steps to help the clients do business with the Ho-Chunk Nation, such as scheduling of clients’ proposals on the legislature’s agenda, making motions for the nation to enter into contracts with the clients, delaying legislative action, and opposing proposed contracts between the nation and competitors of the clients.
Co-defendants Pettibone and Atherton were previously convicted and sentenced. Pettibone pleaded guilty to a bribery offense based on his receipt of the Firebird, along with money and other valuables, and was sentenced to five years in federal prison on July 11, 2012. Atherton was sentenced on October 10, 2012, to four years and two months in prison for her role in the bribery scheme and a separate loan fraud scheme. In a related case, Brian Johnson, 42, Shakopee, Minnesota, was sentenced to four months in prison for lying to federal agents during the course of the bribery investigation.
Whiteagle argued at trial, and again at sentencing, that the money and other things of value that he gave to Pettibone were not bribes but merely gifts given in the Ho-Chunk tradition. Judge Conley found that Whiteagle was “the center” of the scheme and profited immensely from businesses wanting to do business with the Ho-Chunk Nation. The judge found that Whiteagle showed a “willingness to engage in any behavior to benefit himself,” including bribery, telling a witness to lie, failing to pay taxes, and lying under oath. In rejecting Whiteagle’s arguments, Judge Conley said, “It is offensive to the court and to the Ho-Chunk Nation to suggest that bribery was part of ‘the Ho-Chunk way.’…Bribery and blatant lying is not the Ho-Chunk way; it is the farthest thing from the Ho-Chunk way.”
United States Attorney Vaudreuil stated, “This prosecution demonstrates the commitment by this office and the U.S. Department of Justice to vigorously investigate and prosecute corruption in tribal governments.”
The charges against Atherton, Whiteagle, Pettibone, and Johnson resulted from a joint investigation conducted by the Federal Bureau of Investigation and IRS Criminal Investigation, with assistance from the Ho-Chunk Nation, the Wisconsin Department of Administration-Division of Gaming, and the U.S. Department of Interior-Bureau of Indian Affairs, Office of Inspector General. The prosecutions have been handled by Assistant U.S. Attorneys Stephen P. Sinnott and Laura Przybylinski Finn.