Leischners arraigned again

A Laurel family accused of conspiring to embezzle federal money from a water project in north-central Montana faces new charges, this time that they failed to report income — including from Rocky Boy’s Indian Reservation — when applying for financial aid for their son.

Brenden James Leischner pleaded not guilty Tuesday in federal district court in Great Falls to charges that he and his parents, Mark and Tammy Leischner, conspired to file false information in financial aid applications and appeals while Brenden Leischner was enrolled in a criminal justice program at the University of Great Falls.

U.S. Magistrate Judge Keith Strong entered not guilty pleas, and temporarily appointed an attorney to represent Mark and Tammy Leischner, after they said they had previously retained an attorney but since then their financial circumstances had changed. Strong told the Leischners to file financial affidavits for the court to consider appointing an attorney to represent them.

He set a pretrial telephone conference for today with U.S. District Judge Brian Morris.

The Leischners and other members of their family were indicted in a string of charges alleging fraud and embezzlement at Rocky Boy, including stealing federal money allocated to build a water system to serve 30,000 people on the reservation and across the region to the Rocky Mountain Front and federal money and insurance proceeds to build a new clinic after the 2010 flooding destroyed the existing multi-million facility.

Tammy Leischner pleaded guilty April 8 to aiding and abetting embezzlement with other charges stemming from her indictment dismissed. She is scheduled for sentencing Aug. 21.

The government dismissed charges against Mark Leischner in that case, saying at the time that his role in that conspiracy, bribing Chippewa Cree Construction Corp. CEO Tony Belcourt and his wife, Hailey, and double-billing the tribe on water pipe shipments was minor and the government would focus on other existing and pending charges against him.

Tammy Leischner’s father, James Howard Eastlick Sr. of Laurel, also pleaded guilty in the case. Her brother, Havre psychologist James Howard Eastlick Jr., pleaded guilty in other cases involving the Belcourts and others.

Eastlick Jrs.’ business partner Hunter Burns also pleaded guilty. Another man with whom the government says Eastlick Jr. had business relations, former Havre School Board Chair Shad Huston, is scheduled to go on trial June 9.

Mark and Tammy Leischner are scheduled to go on trial June 16 in Billings on charges they failed to report in bankruptcy filings in 2012 some $800,000 of income including from Rocky Boy’s Chippewa Cree Tribe, the Chippewa Cree Tribe Rodeo Association and from the company that sold the water pipe in the embezzlement indictment.

The indictment unsealed Tuesday lists 11 charges, with various counts of conspiracy to defraud the United States, making false statements in federal student aid applications, theft of federal student aid and identity theft.

According to the indictment, while applying for financial aid for Brenden Leischners, the family failed to report $767,510 in payments and promissory notes received in 2009-2011 including money referenced in the embezzlement indictment as well as from the Eastlick Jr.-Tony Belcourt partnership through which Belcourt contracted his services to the construction corporation and a Nevada corporation linked in a lawsuit filed in state court with the Chippewa Cree-run Northern Winz Casino.

The indictment also charges the defendants with identity theft for falsifying a co-signature on a federal student loan application.

The indictment says the family falsely obtained nearly $100,000 in student aid, including Brenden Leischner receiving $18,000 between Sept. 10 and Jan. 18, while the embezzlement charges were pending against his parents.