By Barbara Dewey
MINNEAPOLIS _ Minnesota's Indian gambling industry is zooming
toward the $1 billionyear mark with little of the regulatory
scrutiny that law enforcement officials say is needed to keep
crime and fraud out of the casinos.
Four years have passed since Congress gave Indian tribes the
right to run casinoyle gambling in states where similar gambling
is allowed off reservations. In that time, Minnesota has emerged
as the clear leader in the Indian gaming industry.
An estimated $900 million were bet at 13 casinos and bingo
halls on Minnesota Indian reservations in 1991. That's nearly
twoirds of the estimated $1.4 billion wagered last year at more
than 100 Indianerated gambling centers across the country.
The combination of a massive cash flow and a shortage of
regulatory oversight is an invitation to trouble, some experts
"It's the same fear you would have if you don't regulate
offservation gambling," said Michael Cox, general counsel for the
National Indian Gaming Commission. "It's the potential for large
sums of money to be changing hands illegally. Gambling always
attracts organized crime and criminal elements."
Several state and federal agencies have been assigned roles in
the regulation of Indian gaming. But their efforts have fallen
short due to a lack of personnel or legal authority, or simply
due to the rapid growth of the industry.
The National Indian Gaming Commission, created by Congress to
help regulate Indian gaming, is still writing regulations and
doesn't expect to be fully up and running until November.
The U.S. Bureau of Indian Affairs is handling some of the
commission's duties temporarily. The bureau only recently
announced plans to beef up staff for more thorough background
checks and scrutiny of companies hired to run Indian casinos.
Minnesota has only three enforcement staffers working full time
on the issue, though state officials acknowledge they have had
primary responsibility for regulating Indian gaming.
The U.S. attorney's office in Minnesota is shifting people from
other duties to work on Indian gaming and says eventually it will
need more people.
"My office and other federal authorities, plus the state
gaming people ... are spending a tremendous amount of time on
this issue," said U.S. Attorney Tom Heffelfinger.
"We have uncovered evidence that I will not discuss ... but
that causes me to investigate further."
State officials say a regulatory "gap" between 1988 federal
law and the explosion in the Indian gaming industry has forced
Minnesota to become in some respects the primary regulator of
Indian gambling in the state _ and, for a time, the only
But federal officials question whether Minnesota can
adequately oversee a vast and growing casino industry with a
regulatory staff designed for bingo halls and slot machines.
"That's like managing a parking lot as compared to the Empire
State Building," said Tony Hope, chairman of the National Indian
"It's not as if Minnesota is turning a deaf ear to this. I
just don't know if they know how to respond to a changing
Indian leaders don't dispute arguments that their casinos need
to be regulated, but warn that regulation shouldn't be allowed to
strangle the economic boom tribes are enjoying.
"There needs to be some oversight," said Leonard Prescott, a
Sioux who was the first chairman of the National Indian Gaming
Association and now heads the tribal corporation that runs Mystic
Lake Casino in Prior Lake.
Prescott says federal authorities are "more concerned about
regulations than economic development of the tribes. …