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Mohegan tribe says contracts study finds no violations

By Sean P. Murphy, Globe Staff, 7/8/2001

four-month examination of various contracts awarded by the Mohegan tribe of Connecticut in the ongoing expansion of the tribe's casino and resort in Montville, Conn., concluded no federal securities laws or gaming statutes were violated, according to the tribe.

The examination, conducted by the tribe's outside law firm, Hogan & Hartsen of Washington, did make numerous recommendations for improvements in the way contracts are awarded, including adoption of an ethical code addressing conflicts of interest and related party transactions.

Tribal chairman Mark Brown declined comment yesterday, but a statement released by the tribe said the tribal council agreed in principle to adopt the code, a more formal bidding process, a better contract-monitoring process, and stricter documentation on change orders.

The examination focused on the $1.1 billion expansion of the casino, which will include thousands of new slot machines, a 34-floor hotel, a convention center, and a 10,000-seat arena. The first phase is expected to open in September.

Tribal officials have declined to say whether the examination also touched on the $880,000 in fees paid to former tribal chairman Roland Harris for surveying work done by Harris's company. Harris sold the company in 1998, but continued to receive an annual consulting fee. Harris declined comment last week.

Another aspect of the Mohegan Sun's management may become the subject of a hearing this summer before the Senate Indian Affairs Committee. Key members of that committee have said they intend to conduct a hearing on the $10 billion Indian gaming industry.

In a series of articles, The Boston Globe has raised questions about whether the nonIndian investors behind the Mohegan Sun evaded a limit on the maximum allowable share of profit they could take from the casino. That limit was imposed by Congress.