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Federal Watchdog to Examine Official’s Role in Tribal Fund Distribution

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Federal Watchdog to Examine Official’s Role in Tribal Fund Distribution

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WASHINGTON — A federal watchdog is investigating whether a top Interior Department official violated ethics rules when she helped decide how a critical tranche of funds for Native American tribes in the $2.2 trillion stimulus law should be distributed.

The department’s inspector general informed lawmakers on Friday that he would review the roles of Tara Sweeney, the assistant secretary for Indian Affairs, and other top officials “to determine whether there was adherence to ethics rules and regulations and compliance with the ethics pledge” related to the funding.

Several tribal governments are suing the federal government over its decision to allow Alaska Native corporations, for-profit businesses that support tribal villages in Alaska, to receive a portion of the $8 billion set aside for tribes, arguing that the corporations should not be eligible for the aid.

Lawmakers and some tribal leaders have raised concerns about Ms. Sweeney’s involvement in that decision, given that she is a shareholder in the Arctic Slope Regional Corporation, the wealthiest of the Alaska Native corporations, having previously served as its executive vice president for external affairs.

“We just hope this clearly shows a conflict of interest and hopefully she will resign,” said Rodney Bordeaux, the tribal chairman of the Rosebud Sioux in South Dakota.

In a statement, Conner Swanson, a spokesman for the Interior Department, said that Ms. Sweeney had complied with all laws and was “upholding her ethical responsibilities.”

The decision to allow Alaska Native corporations to benefit from the funds has prompted one of the most significant legal battles between tribal governments and the United States in years. More than a dozen tribes filed lawsuits last month challenging the Treasury Department’s decision to allow the corporations to apply for the aid, arguing that they are not federally recognized tribal governments, and therefore do not qualify.

A federal judge has issued a temporary injunction to stop funds from being sent to the corporations during the litigation, all but guaranteeing that some of the aid will remain frozen. The funding was frozen up until last week amid the legal dispute about how it should be parceled out. The Treasury Department announced on Tuesday that it would begin distributing $4.8 billion in aid, just over half of the funds allocated in the stimulus package.

But that judge, Amit P. Mehta of the United States District Court for the District of Columbia, on Monday declined to force the department to immediately distribute the entire tranche of funds, saying that the tribes petitioning for such an order “have not carried their burden to show that the secretary’s delay thus far is so egregious as to warrant” distribution of the relief on Monday.

The inspector general, Mark Lee Greenblatt, also told Senator Tom Udall, Democrat of New Mexico, that in late April his office was investigating allegations that the Interior Department had inappropriately leaked sensitive tribal data submitted as part of the application for the relief, according to a letter obtained by The New York Times.

The data breach intensified frustration among tribal governments, who are among the most vulnerable and hardest hit by the coronavirus pandemic, about how the federal government was handling the distribution of the critical aid.

Mr. Udall, the top Democrat on the Senate Committee on Indian Affairs, had requested a review of both incidents and asked that the department give his panel “departmental ethics guidance and/or waivers granted to Ms. Sweeney related to her potential financial conflicts of interest, direct or imputed to her.”

Mr. Swanson said the interior secretary, David Bernhardt, requested a review by the inspector general after news of the data breach broke.

“As a central pillar of the federal government’s coronavirus pandemic relief for Indian Country, the allocation and distribution of this funding to Indian Country must be done quickly, without bias and without the appearance of any impropriety,” Mr. Udall said in a statement. “The Trump administration’s troubled handling of the distribution of tribal government relief cries out for robust oversight as Indian Country is experiencing some of the worst impacts from the Covid-19 pandemic.”

Lawmakers and aides said they intended for the $8 billion in funds to go to tribal governments, which were recognized in the Constitution and treaties that allowed the United States government to take tribal land. But the more than 200 Alaska Native corporations, which were established in 1971 to manage almost 45 million acres as part of the Alaska Native Claims Settlement Act, and their allies in the state’s congressional delegation argue that they provide resources and assistance to the Native population and should be allowed federal relief to support those efforts.

Representatives for the Alaska Native corporations expressed support for Ms. Sweeney on Monday, saying they were confident that an investigation would confirm she followed all the proper checks and balances.

“I think all will find that not only did the deputy secretary act absolutely according to law, but according to the congressional intent,” said Senator Lisa Murkowski, Republican of Alaska. Suggesting Ms. Sweeney “should be precluded from literally exercising a birthright in terms of her conversation,” she said, “it demonstrates an ignorance and a lack of awareness as to the laws that have been in place for 40 years.”

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