Congress votes to form committee to consider removal of ON Treasurer

For the first time in the Osage Nation’s history, the Second Osage Nation Congress is beginning the process to consider the removal for a principal chief’s appointee.

Osage Nation Treasurer William Kemble is the target of a forthcoming Congressional investigation to determine whether allegations concerning his department’s operations warrant his removal from office.

The Second Osage Nation Congress voted 10-2 to form a select committee of inquiry to investigate actions taken by Kemble during its one-day 13th Special Session on Jan. 4. This committee will be composed of five Congressional members appointed by an Osage Nation Supreme Court Justice and will be charged with conducting a comprehensive investigation limited to the allegations raised in the motion, according to Congressional rules.

If the process (which includes determining whether a removal trial is warranted) is thoroughly completed with a trial verdict calling for removal, Kemble could be the first ON official removed from office.

Congresswoman Shannon Edwards made the motion for a select committee of inquiry in writing, which she read aloud during the Jan. 4 session. It lists 11 allegations against Kemble which include: that he implemented new accounting policies and procedures without Congressional approval; allowed tribal funds to remain undercollateralized in the bank; failed to close the accounting books for the 2009 and 2010 fiscal years; and failed to set the health benefit card maximum payable amounts for the 2012 calendar year by the deadline specified in law.

The Congress held the single day session to approve the 2012 health benefit card payable amounts, which was unanimously approved. Shortly after, Edwards presented the motion for a select committee of inquiry.

The motion passed 10-2 with “no” votes from Congressmen Archie Mason and Eddy Red Eagle.

In a statement to the Osage News, Kemble said he is “disappointed” that the Congressional motion passed.

“I admit that I'm disappointed because I have been trying to implement a system that better safeguards the Nation's monies and assets,” said Kemble, “by implementing quality internal control processes that prevent, not just detect, misconduct; significantly facilitates our accounting process; and significantly improves efficiency and effectiveness over reporting ‘all’ of the Osage Nation's financial position. Again, this effort takes time. I would hope that every Osage would appreciate my efforts and continuing intent to carefully carry out the Treasurer's Constitutional duty/power to ‘administer the fiscal policy and ensure financial accountability.’" 

Chris White, executive director for governmental affairs, said Chief Red Eagle would have no comment on the Congressional decision for the select committee of inquiry.

Also in his Jan. 5 statement to the Osage News, Kemble said: “Ultimately, after initially gaining knowledge and working in our inherited system, I'm glad to see that our government is giving more attention to the involvement, processes, and financial reporting of the Nation's Treasury than the first four years of our reformed government… For now, I will continue to do my best to serve my Osage People and government."  

This marks the second time Congress has initiated investigation proceedings against Kemble and his department in less than a year. In July 2011, a Congressional committee held a Special Session after it subpoenaed Kemble and several accounting workers on the accounting department operations after Congress received tips of questionable practices taking place. On July 14 and 15 the Congressional Committee on Government Operations conducted interviews with Kemble and other subpoenaed accounting workers.

The subpoena meeting testimony revealed that tribal funds were not entirely collateralized while being kept in a Pawhuska bank and Kemble moved $300,000 in Osage Minerals Council funding to keep the Nation’s money held in the bank under the collateralization limit, according to a Congressional report on the subpoena meetings. The OMC funds were moved without the knowledge and authorization of the OMC, the report stated.

Kemble told the Congressional committee in his July 15 testimony that he was revising the 2004 accounting policies and procedures to reflect the reformed 2006 government, but some Congress members have countered that any changes to accounting policies and procedures must be approved by the legislative body, per ONCA 06-02 which is the tribal law establishing the Department of Treasury.

Following the subpoena meetings, Principal Chief John Red Eagle, who appointed Kemble as Treasurer in October 2010, told the Congress he would hire an outside accounting firm to “perform an assessment of the current accounting infrastructure,” according to a letter he wrote to Congressional Speaker Jerri Jean Branstetter on Oct. 4. Due to the investigation by the (Congress)… I am looking further into all allegations. I do not take accusations lightly and as a result I am making every effort to come to the truth of the matter,” Chief Red Eagle wrote.

Accounting assessment

Congress received a copy of the assessment, conducted by Montana-based Joseph Eve: The Tribal Solutions Provider, which was dated Dec. 21.

According to Joseph Eve’s report, the company issued recommendations which include: “The Treasurer should follow the existing accounting policies and procedures unless an emergency is properly declared and continue updating current policies and procedures and submit them to the Congress for approval.” The report also recommends tribal funding “deposits should be moved to another financial institution that is willing to provide adequate pledged collateral to ensure deposits are fully collateralized in accordance with Osage Nation policies and procedures.”

Edwards said the Joseph Eve report is “part of the basis of my belief we have to move forward as a Congress to fulfill our duties.” On the report, Edwards said: “I thought it confirmed the findings of the Congressional committee and brought to light some new problems.”

In the motion for a select committee, another listed allegation is: “The Treasurer has attempted to undermine the appropriation process by limiting the definition of revenue, limiting the ability of the government to designate capital contributions as investments and denying the government the ability to authorize and spend out of revolving funds through written letters to the Speaker and Principal Chief.”

This allegation refers to a hold up in the 11th Special Session held in November when the Congress voted to end the session early after Kemble sent Branstetter a letter raising issues such as different balances (comparing his records to accounting records kept by Congress) in remaining tribal funds available for FY 2012 spending and raised questions on whether the Congress could use unspent funds from previous fiscal years. The session adjourned and the remaining legislative items were considered in the 12th Special Session last month.

Chief Red Eagle, who was not consulted by Kemble before he sent the letter, told Congress after consulting with legal counsel on the issue that the Congress does have the authority to use the unspent money. In a Nov. 30 letter, Chief Red Eagle wrote: “To deny Congress this appropriation authority is to deny services to the Osage people. That is a conclusion I cannot reach.”

Also listed is an allegation that Kemble “has violated the appropriation process by distributing funds in the form of loans to employees without any authorizing appropriation legislation.”

Edwards sponsored a bill to create a revolving fund for the Nation’s employee loan program during the 2011 Tzi-Zho Session, which was pocket-vetoed by Chief Red Eagle after the session adjourned. No replacement bill to appropriate money for the 2012 fiscal year employee loan program was filed in Congress afterward but the employee loan program continued disbursing loans, which left questions of where the funding was coming from and who authorized the loans.

The Osage News inquired with the Executive Branch on the employee loan issue in December but has not received a response.

Loyed “Trey” Gill, Congressional legal counsel, said after the motion is made, the Speaker will inform the Supreme Court of its plans for a select committee of inquiry and one of the three Justices will appoint the five Congress members to sit on the committee. Edwards, who made the committee motion, will not be eligible for the committee, he said.

The Select Committee of Inquiry shall be appointed within 10 days of passage of the committee motion, according to the Congressional rules.