Judge: Cobell historical accounting 'impossible'
The federal judge handling the Cobell trust fund case has issued his findings of fact and conclusions of law on the Bush administration's historical accounting.

In a 165-page decision, Judge James Robertson said the Interior Department is "unable to perform an adequate accounting" of the Individual Indian Money (IIM) trust. He said the government "has not" and "cannot" cure its breach of trust to hundreds of thousands of Indian beneficiaries.

"Indeed, it is now clear that completion of the required accounting is an impossible task," the judge wrote, describing the breach of trust as "irreparable."

Robertson arrived at the conclusion not based on the plaintiffs' argument that there are too many destroyed and missing records. Instead, he said Interior cannot perform a satisfactory accounting given budget constraints imposed by Congress.

"In its refusal to appropriate enough money to pay for such an accounting, Congress has not amended that demand or the common law of accounting," Robertson observed. "What it has done, instead, is to render a real accounting impossible -- or, perhaps, to recognize that such an accounting is impossible, unless it is 'nuts' enough to pay more than $3 billion to hunt down perhaps $3 billion of unexplained variances in the government's accounts."

Even though he recognized Congressional limits, Robertson did not let Interior off the hook. He said the department's most recent accounting plan "falls short of its promise to provide beneficiaries reasonable assurance that their account balances are accurate" because it doesn't confirm opening balances or go all the way back to the inception of the IIM trust.

Robertson said Interior's failure to tie land -- the corpus of the trust -- to the revenues generated by activities on the land makes it "utterly impossible" for a trust beneficiary to determine whether the department is fulfilling its fiduciary duties. "Beneficiaries are provided no records indicating their historical ownership interests," he said of the accounting plan.

Regarding the actual scope of the accounting, Robertson agreed that beneficiaries who receive direct payments are not included because said their funds are never "held" in trust by the government. Similarly, beneficiaries whose trust funds are managed by tribes -- there are two known cases -- are not owed an accounting by the government.

On a second scope issue, Robertson said the department cannot exclude administrative fees and Youpee interests -- named for a U.S. Supreme Court Case -- from the accounting. Fees charged by the government and unconstitutional escheatments of Indian land to tribes must be part of the plan, he said.

Special deposit accounts, however, can be excluded, Robertson concluded. He said Interior's method for dealing with the accounts -- by going after the high-dollar ones first -- is reasonable.

But he said Interior's decision to exclude IIM accounts that were closed before the American Indian Trust Fund Management Reform Act became law and to exclude predecessor interests is "not sanctioned by the common law of trusts or the plain terms of the 1994 act." "The rationale for including predecessor accounts in the historical accounting process is simply that beneficiaries are entitled to know where their money came from," he noted.

Robertson plans a hearing in 30 days to discuss the next step in the case -- how to "remedy" the situation.

Court Decision:
Findings of Fact and Conclusions of Law (January 30, 2008)

Final Briefs:
Cobell Brief: Conclusions of Law | Cobell Brief: Findings of Fact | DOJ Brief: Findings of Fact and Conclusions of Law

Trial Transcripts:
Day 1 AM | Day 1 PM | Day 2 AM | Day 2 PM | Day 3 AM | Day 3 PM | Day 4 AM | Day 4 PM | Day 5 AM | Day 5 PM | Day 6 AM | Day 6 PM | Day 7 AM | Day 7 PM | Day 8 AM | Day 8 PM | Day 9 AM | Day 9 PM | Day 10 AM | Day 10 PM

Trial Order:
Cobell v. Kempthorne (April 20,2007)

Relevant Links:
Indian Trust: Cobell v. Kempthorne - http://www.indiantrust.com
Cobell v. Norton, Department of Justice - http://www.usdoj.gov/civil/cases/cobell/index.htm

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