Fitch Ratings announced upgrades for $2.3 billion in gaming-related debt owned by the
Seminole Tribe of Florida.
Fitch downgraded the tribe's debt after the
National Indian Gaming Commission
issued a notice of violation in June 2010 for alleged misuse of gaming revenues.
But now that the tribe has addressed the concerns, Fitch upgraded ratings on $1.74 billion in bonds and term loans and on $528 million in bonds.
"The upgrade of STOF's ratings reflects Fitch's increased level of comfort about the tribe's governance practices since the agency downgraded all of STOF's ratings out of investment grade in June 2010," Fitch said in a press release.
After receiving the notice of violation, the tribe paid a fine of $500,000 and agreed to three annual audits of its gaming revenues. So far, the tribe has completed "two clean audits," according to Fitch.
"Importantly, STOF canceled its tribal council's discretionary accounts, which historically increased the risk of mismanaging gaming revenues," Fitch added.
The NIGC had singled out a tribal leader who used his discretionary account to spread millions of dollars in revenues to tribal members.
Get the Story:
Press Release:
Fitch Upgrades Seminole's Gaming Bonds to 'BBB-'; Special Obligation Bonds to 'BB '; Outlook Stable
(Fitch Ratings 6/25)
Relevant Documents:
Notice
of Violation to Seminole Tribe (June 3, 2010) |
Agreement for Civil Fine Assessment (October 27, 2010)
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