A paper trail of embezzlement at Rocky Boy

The federal government filed documents showing what facts it was prepared to prove in court against Tony Belcourt, 42, and Hunter Burns, 48.

The two entered guilty pleas in some of six indictments — four of which involving Tony Belcourt and Rocky Boy’s Indian Reservation psychologist James Howard Eastlick Jr.

Two other cases indict Tony Belcourt and his wife, Hailey, on tax and bank fraud. Tony Belcourt pleading guilty to tax fraud Wednesday as well as to theft and two counts of bribery.

Burns pleaded guilty to filing false claims in government-funded projects.

Belcourt and Burns, in separate hearings, agreed that the government had sufficient proof in the cases in which they were pleading to convince a jury to convict.

One of the cases involves Eastlick Jr.’s father, sister and brother-in-law, James Howard Eastlick Sr., and Tammy and Mark Leischner, all of Laurel. Another indicts former Havre school board chair Shad Huston, two indict Burns and Eastlick Jr, and all but one also indict Belcourt’s wife, Hailey Belcourt.

In the offer of proof, the prosecution says that between October 2007 and September 2012, the Chippewa Cree Tribe at Rocky Boy received more than $450 million including more than $8.4 million in the Cobell v. Salazar lawsuit settlement, $25 million in insurance payments after the flooding in 2010 and more than $33 million from the U.S. Bureau of Reclamation for construction of the Rocky Boy’s/North Central Montana Regional Water System, on which Chippewa Cree Construction Corp. is the lead contractor.

Tony Belcourt was hired as CEO and chief contracting officer of tribally owned Chippewa Cree Construction when it was formed in 2006 to build the pipeline. It also was the lead contractor in the flood repairs, for which Belcourt was named emergency incident commander.

Belcourt originally was an employee of Chippewa Cree Construction, then later contracted his work to the company through a company he and Eastlick Jr. formed.

Hunter Burns and James Eastlick Jr. were partners in Hunter Burns Construction LLC, which was formed to bid primarily on federally funded projects at Rocky Boy.

Construction contracts paying ranch debts

The offers of proof say that by 2008, Tony and Hailey Belcourt had taken out eight loans from a local bank totalling more than $700,000 using property, including from their ranch, as collateral.

In July 2009 the bank initiated foreclosure on the loans.

In August 2009, Tony Belcourt approved and provided a $94,050 payment to Hunter Burns Construction, and one week later the company paid Hailey Belcourt $35,000 for a reseeding contract on the pipe. Two weeks later Tony Belcourt awarded Hunter Burns Construction a $54,000 reseeding contract. Hailey Belcourt used $20,000 of the $35,000 to pay down debt at the bank, the offer of proof says.

In August 2009, Tony Belcourt sold 190 head of cattle at a Colorado auction company, for $107,153.09, and had the proceeds deposited into another person’s business account, the offer of proof says.

Later, the bank noticed the reduced number of head of cattle at the ranch and an investigation showed the cattle sold were securing the loans. The auction company issued a new check to the Belcourts and demanded repayment of its previous check, the offer of proof says.

In November 2009 Tony Belcourt approved a Chippewa Cree Construction payment to Hunter Burns Construction of $148,972, and two days later Hunter Burns issued a $100,000 check — listed as a loan — to Hailey Belcourt, which she then used to pay the auction company, the offer of proof says.

The Belcourts were indicted for tax and bank fraud related to those transactions.

Filing a false claim

Burns, Eastlick Jr. and Tony Belcourt were indicted for filing a false claim — to which Burns pleaded guilty — when Burns filed a $100,000 invoice for contract mobilizations costs for which he had bid $15,000. Hunter Burns Construction was paid the $100,000 and the $15,000, the offer of proof says.

Of the $100,000, $90,000 was distributed almost immediately to Burns, Eastlick Jr. and to an unnamed tribal council and Chippewa Cree Construction board member, the offer of proof says.

Double-billing pipe for business, rentals

The indictment involving James Eastlick Sr. and the Leischners alleges Tammy Leischner created a company which was almost immediately awarded a $495,000 shipping contract, although another company already had been awareded that contract.

The offer of proof says Belcourt approved a one-third of the contract payment of $165,000 to T Leischner Consulting, and once the check cleared, Eastlick Sr. transferred $101,000 to recently created Billings pipe company MT Waterworks, purchasing a controlling interest in the company for Tony Belcourt.

The transfer did not leave enough money for T Leischner to continue moving pipe, and Eastlick Jr. provided the company “an additional $45,000 in late March (2010) to keep the pipe moving,” the offer of proof says.

Leischner then billed Chippewa Cree Construction for the full $495,000, though it had received a one-third payment, the offer of proof says.

Shortly thereafter, Eastlick Sr. deposited $200,000 from a Leischner consulting bank account to the Chippewa Cree Rodeo Association account. One month later, two checks totalling $133,000 were issued to Mark Leischner from the rodeo account, which he deposited into the Leischner’s personal account, the offer of proof says. On July 2, 10 days later, Tammy Leischner bought a $62,000 cashier’s check payable to Hill County Title which Hailey Belcourt used to buy a rental property in Box Elder, the offer says.

Clinical insurance consulting

In the case indicting the Belcourts, Shad Huston and Eastlick Jr., who was a partner in some of Huston’s business ventures, the offer of proof says Belcourt awarded several contracts to Huston’s businesses. One, TMP Services received a payment of $66,670 and within a few weeks the company issued a loan to Hailey Belcourt for $7,500.

On Sept. 22, 2011, Belcourt approved a $100,110 payment to Huston’s K Bar K Trucking, the offer of proof says, and on Oct. 3, 2011, Huston wired $10,000 to the Belcourts’ bank account, which was overdrawn by $4,547. Nov. 25, 2011, Chippewa Cree Construction issued a $231,000 check to TMP Services and the same day TMP Services issued a $5,000 check to Hailey Belcourt.

By December 2011, after the Belcourts purchased a significant number of cattle, the offer of proof says, their checking account was overdrawn by more than $250,000.

On Dec. 22, 2011, Huston’s K & N Consulting received a cashier’s check from the Chippewa Cree Tribe that incident commander Belcourt approved as “claims prep,” the offer of proof says.

K & N Consulting had issued a $200,000 check to Belcourt notated as “consulting services” Dec. 20, 2011, which Tony Belcourt deposited Dec. 23, 2011, the offer of proof says.

Dec. 22, 2011, Huston also obtained a $100,000 cashier’s check payable to Belcourt which he deposited Dec. 23, 2011.