Reservation community responds

Part III of a series

Geneva Lone Hill inside the community center, which is one of four buildings constructed by the Wakpamni Lake Community Corporation. (Photo by Ernestine Anukasan)

BATESLAND – The community that was victimized by a scam that took advantage of the abject poverty that grips much of the Pine Ridge Indian Reservation responded to recent press coverage by Native Sun News Today.
The Wakpamni District, with a population of about 5,000, is one of nine districts located on the Pine Ridge Indian Reservation in Southwest South Dakota. The reservation is located within Oglala Lakota County which was designated by the U.S. Census Bureau in 1980 as the poorest county in the nation.
This designation was the icing on the cake that enabled a few unscrupulous individuals to concoct a scam that defrauded investors out of more than $60 million by taking advantage of these impoverished people.
According to Geneva Lone Hill, President of the Wakpamni Lake Community Corporation, in 2014 members of the WLCC had traveled to the Reservation Economic Summit (RES2014) in Las Vegas seeking economic opportunities.
With little or no capital, no land base and no collateral it is often difficult for tribal members and tribal communities to obtain loans from banks to invest in their business ventures.
So when they encountered a man named John Galanis who was staffing a booth inside one of the conference rooms pitching his bond offering scheme, Galanis seemed like a Godsend.
Lone Hill said Galanis was representing Burnham Securities, a firm they believed to be well-established and reputable. Galanis had also been targeting other Native American tribes at the RES conference, but of all the tribes Galanis could have chosen to inflict his multimillion dollar scam on, it’s a shame he targeted the poorest people in the U.S.
According to a lawsuit filed in October 2019 by Chicago Transit Authority Retiree Health Care Trust and the Board of Trustees for the Chicago Transit Authority Retiree Health Care Trust (RCHT) aimed at the law firms Dilworth Paxson, LLP; Timothy Anderson; and Greenberg Traurig, LLP, in March of 2014 while at the RES2014 conference, Raycen Raines, CEO of the WLCC invited former WLCC attorney Timothy Anderson to attend a meeting with John Galanis to discuss a proposal for the bond offering.
“During the meeting, John Galanis explained his proposal to have WLCC issue debt in the form of bonds. Unlike other municipal bonds, the vast majority of the bond proceeds under Galanis’s plan would be invested in an annuity contract with an offshore insurance company. The revenues from the annuity contract would then be used to pay the principal and interest payments due on the bonds (i.e., the debt service).”
The lawsuit states that if the plan had worked it would have generated “free money” for WLCC and that the annuity concept was “novel” and “something new.”
So when WLCC entered into a partnership with what they believed were reputable representatives of Burnham Securities, which was pitched as co-owned by Hunter Biden, the Vice-President’s son and others, they believed it was the answer to their hopes and dreams for a better tomorrow.
According to Lone Hill the money generated would have given the Wakpamni District ample capital to invest in a warehouse where they could ship goods they had produced locally, a laundromat, a bakery, a community building for Bingo and community events, a tutoring facility to teach Lakota language and entrepreneurial skills, an incubator for business start-ups, a sewing center and a bowling alley.
When WLCC received an initial payment of $2,250,000, which was held in trust by U.S. Bank, Lone Hill said the community broke ground on construction of their warehouse.
However when the rest of money they were promised failed to deliver, community members became suspicious and began an investigation, Lone Hill said. What they uncovered would send shockwaves all the way to the Whitehouse.
“On the surface everything was completely legit. It was so sophisticated,” said an attorney for WLCC. “When you’re on the outside looking in, it all looked completely legit.”
After the members of the community gathered evidence in what they believed was a scam, Lone Hill said they turned over what they uncovered to the U.S. Attorney’s Office.
The U.S. Attorney’s office took their claims seriously and began an investigation. However the scam turned out to be so sophisticated even the U.S. Attorney’s office had difficulty figuring it all out and it would take them several years to prosecute and convict Jason Galanis, Hugh Dunkerley, Gary Hirst, John Galanis, a/k/a “Yanni,” Bevan Cooney, Devon Archer and Michelle Morton in the fraud against the Wakpamni community and the trust funds who invested in the bonds. www.justice.gov/usao-sdny/pr/seven-defendants-charged-manhattan-federal-court-defrauding-native-american-tribe-and
Lone Hill said they were called to be witnesses in the trial against the perpetrators and had to travel to New York to testify. All seven of the defendants were tried and convicted in varying degrees of securities fraud and conspiracy to commit securities fraud. However Devon Archer would have his conviction overturned by the judge who heard the case against him.
Archer had been a partner with his former college roommate, Hunter Biden and connected to an opaque investment company, called Rosemont Seneca Bohai, LLC, which on information and belief, was affiliated with the investment company Rosemont Seneca Partners, LLP.
Since that time the scandal continues to be in the news even catching the attention of the New York Post and the Wall Street Journal.
The Wakpamni Lake Community Corporation (WLCC) issued the following statement in October in response to news coverage on the Galanis Bond Fraud and an official statement from the firm that represented WLCC in the bond sale and named in the Chicago lawsuit, Greenburg Traurig.
The criminal cases against Galanis and others were settled nearly two years ago. But because Hunter
Biden’s name was involved and because of the recent Chicago civil lawsuit the case is back in the news.
● WLCC and several retirement funds, were the victims of a bond fraud. Our economic development project was and is very real, the bond companies we dealt with were legitimate. But there were criminals working for them behind the scenes.
● Once we realized something was wrong, we went to the federal prosecutors.
● The US Attorney’s Office in NY, the FBI, and the SEC conducted a long investigation and charged all the bad actors.
● WLCC, our staff, our lawyers, and our business partners, had nothing to do with the fraud. We turned in the criminals and we testified against them.
● WLCC, our CEO Raycen Raines, and all our team was exonerated by the federal investigators. The guilty people are all in jail.
● After the criminal cases were finished, the investors that lost money started filing lawsuits against different people and companies to try and get some of their money back. The Chicago lawsuit from last week is another one of those cases filed.
● Neither OST nor Wakpamni District are liable. They were not parties to the bond.
● WLCC, nor our staff Mr. Raines, nor our business partner Mr. Haynes are defendants in the Chicago lawsuit.
● But the Chicago lawyers still made many statements which are wrong.
● We understand the investors are devastated and doing everything they can to file lawsuits against whomever they can. We as Lakota know better than almost anyone how it feels to be targeted and wronged. As retirees, as elders, our hearts hurt for their losses.
● But we too are victims and false statements in the Chicago complaint re-victimizes us.
● Statements in a complaint by an upset party does not change the facts of the case that were thoroughly investigated by the federal government, litigated in federal criminal court, and the guilty people were sent to jail.
● We are not defendants in the Chicago lawsuit and are not going to get drawn into their legal arguments, but there are many organizational and factual inaccuracies their non-Tribal lawyers are stating their claims from.
● Mr. Raines and Mr. Haynes are not our “financiers.” Mr. Raines is our staff, he is our CEO. Mr. Haynes was hired by us to be our project developer as we have all worked together successfully in the past.
● WLCC does not “exercise undue influence over” the Wakpamni Lake Community. The Wakpamni Lake Community owns WLCC. WLCC is the wholly owned economic development arm of the Wakpamni Lake Community tasked with creating new income, new employment, new infrastructure and new services for the benefit of our Tribal Community members.
● OST is the tribe. Under the tribe there are Districts and Community governments. The OST constitution and code give Districts and Communities their own authority to pursue economic development.
● The OST Council got in a political fight with the OST President Brewer. President Brewer had asked our CEO to assist him with some of his economic development projects, including TED Bonds. When the OST Council tried to impeach President Brewer they passed a resolution also stopping business with our CEO. WLCC and OST are separate. Regardless of OST’s decision, Mr. Raines always kept his authority with WLCC as our CEO. We never issued TED bonds.
● OST never voted against our bond project. Some investors asked for a resolution of support from
OST, so we asked OST for it. The OST Council and the OST Economic & Business Development Committee members told us and our lawyers that WLCC already had the authority to do it and they were not going to waste time passing a resolution saying something we could already do. The tribe’s lawyer sent us a formal letter stating that.
● Our economic development project for this bond was to complete a planned set of commercial and community buildings known as the Town Center that would include businesses for the commercial buildings generating income and employment. The buildings did not get completed. But not due to mismanagement of funds by WLCC. EVERY single dollar WLCC spent on the project was accounted for. They didn’t get completed because we discovered the fraud and promptly turned them in during the middle of constructing our project. We then we gave the last bit of bond money for the construction project that we had to US Bank the bond trustee, to do an investigation of the bad actors.
We understand the retirement funds are upset. We have also been devastated by this fraud, but now we are being re-victimized all over again by the Chicago complaint with the many false statements.
Even though we were the victims, and our team did nothing wrong, this hangs over Indian Country and our Community every day. We had to put all our economic projects on hold when the news articles came out two years ago, and now maybe we will have to again as the inaccurate claims draw out the emotions and not the logic from those that read the complaints.
It is hard enough to do economic development on rural isolated Indian reservations without having
falsehoods on top of the fraud. Please read the facts of the actual government case. Please ask us directly if you have any questions, glonehill@gmail.com . Thank you
Geneva Lone Hill
President, Wakpamni Lake Community Corporation (WLCC)

Below is Greenberg Traurig’s official statement on this topic.

“The fraud perpetuated against WLCC was a tragedy for all. WLCC was a victim of the fraud and its attorneys did not assist the fraud in any way. That is shown by the fact that neither WLCC nor its attorneys were charged in the criminal proceedings against the wrong doers who have pleaded guilty.”
Next week: Wakpamni Lake: Making a comeback

(Contact Ernestine Anukasan at production@nativesunnews.today)

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