8. Fine--Submission of Information

The violation cited above may result in the assessment of a civil fine against Respondent
in an amount not to exceed $25,000 per violation per day. Under 25 C.F.R. § 575.5(a),
Respondent it written information about the violation to the Chairman within
15 days“fter service of this notice of violation (or such longer period as the Chairman of
thg’“Commission may/grant for good cause). The Chairman shall consider any
yiformation submitted in determining the facts surrounding the violation and the amount
of the cNil fine, if any.

Dated this of Julys

PHEHIP N. HOGEN7
Chairman
National Indian Gaming Commission

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WENDYY. HELGZMO

Staff Attorne:


To:

National Indian Gaming Commission

NOTICE OF VIOLATION

NOV-06-13

Robert Salgado, Sr., Chairman (AGENT FOR SERVICE OF PROCESS)
Soboba Band of Luiseno Indians

P.O. Box 487

San Jacinto, CA 92581

FAX: (951)654-4198

Jerry Peebles, Chairman

Soboba Band of Luiseno Indians Gaming Commission
P.O. Box 817

San Jacinto, CA 92581

FAX: (951)487-0042

1. Notification of Violation

The Chairman of the National Indian Gaming Commission (NIGC) hereby gives notice
that the Soboba Band of Luiseno Indians (Respondent or Band), located in San Jacinto,
California, is in violation of the Indian Gaming Regulatory Act (IGRA) and NIGC
regulations for failure to submit an annual audit.

2. Authority

Under regulations of the National Indian Gaming Commission, the Chairman of the
NIGC (Chairman) may issue a Notice of Violation (NOV) to any person for violation of
any provision of IGRA, NIGC regulations, or any provision of a tribal gaming ordinance
or resolution approved by the Chairman. 25 C.F.R. § 573.3.

3. Applicable Federal and Tribal Laws

A. IGRA requires an annual audit of each gaming operation and requires that a copy
of the results of the annual audit be submitted to the NIGC. 25 U.S.C.
§ 2710(b)(2)(C).


NIGC regulations require that a tribe cause to be conducted annual independent
audits of the financial statements of each gaming operation on Indian lands and
submit a copy of the audit report(s) and any management letter(s) setting forth the
results of the annual audit(s) to the NIGC within 120 days after the end of each
fiscal year. 25 C.F.R. §§ 571.12 and 571.13.

The Band’s gaming ordinance (Ordinance) was enacted to authorize and regulate
the terms and conditions under which Class II and Class III gaming may be
conducted within the boundaries of the Soboba Indian Reservation. Soboba Band
of Luiseno Indians Ordinance to Establish Requirements for Class II and/or Class
III Gaming Operations on Tribal Lands, Section I.

The Ordinance requires that the Band shall cause to be conducted at least annually
an independent audit of all gaming operations and shall submit the resulting audit
reports to the NIGC. Soboba Band of Luiseno Indians Ordinance to Establish
Requirements for Class II and/or Class III Gaming Operations on Tribal Lands,
Section V.A.

4. Role of Independent Audit Report

Submission of the annual independent audit report by a firm of certified public
accountants is critical to the NIGC’s mission to protect the integrity of Indian gaming. A
firm’s ability to conduct an audit in accordance with Generally Accepted Auditing
Standards (GAAP) and render an opinion on the financial statements prepared in
conformity with GAAP provides a certain level of assurance as to the security of tribal
gaming revenues. The audit report prepared and submitted on a timely basis is evidence
of, among other things, the integrity of the gaming operation and, more specifically, of
the adequacy of the books and records, the functioning of the internal financial controls,
and the disclosure of information having a bearing on the financial statements.

5. Circumstances of the Violation

A.

Respondent is a federally recognized Indian Tribe with tribal headquarters in San
Jacinto, California.

Respondent operated its gaming facility, Soboba Casino, during all or part of
2005.

NIGC has not received an annual audit or audit report for the fiscal year ending
December 31, 2005. The audit was due to the NIGC on April 30, 2006, 120 days
after the end of the Band’s fiscal year.


D. IGRA requires that tribes submit annual audits of each gaming facility. 25 U.S.C.
§ 2710(b)(2)(C). NIGC regulations require that a tribe cause to be conducted an
annual independent audit of the financial statements of each gaming operation on
Indian lands and submit a copy of the audit report(s) and any management
letter(s) setting forth the results of the annual audit(s) to the NIGC within 120
days after the end of each fiscal year. 25 C.F.R. §§ 571.12, 571.13. The Band is
therefore in violation of these statutes and regulations, as well as Section V.A. of
the Band’s Ordinance, for failure to timely submit an annual independent audit
report.

6. Measures Required to Correct these Violations

There is no way to rectify the late submission of an annual audit. NIGC regulations
require that audits be received within 120 days of the end of the fiscal year. 25 C.F.R.
§ 571.13.

7. Appeal

Within 30 (thirty) days after service of this Notice of Violation, Respondent may appeal
to the full Commission under 25 C.F.R. Part 577 by submitting a notice of appeal and, if
desired, request for hearing to the National Indian Gaming Commission, 1441 L Street,
NW, Ninth Floor, Washington, DC 20005. Respondent has a right to assistance of
counsel in such an appeal. A notice of appeal must reference this Notice of Violation.

Within ten (10) days after filing a notice of appeal, Respondent must file with the
Commission a supplemental statement that states with particularity the relief desired and
the grounds therefore and that includes, when available, supporting evidence in the form
of affidavits. If Respondent wishes to present oral testimony or witnesses at the hearing,
Respondent must include a request to do so with the supplemental statement. The request
to present oral testimony or witnesses must specify the names of proposed witnesses and
the general nature of their expected testimony, whether a closed hearing is requested and
why. Respondent may waive its right to an oral hearing and instead elect to have the
matter determined by the Commission solely on the basis of written submissions.