National Indian Gaming Commission 

NOTICE OF VIOLATION 

To: President Mark Chino (Agent for Service of Process) 

Mescalero Apache Tribe 

Box 227 

Mescalero, NM 88340 

FAX: (505) 464-9 19 1 

Albert Apodaca, Executive Director 

Mescalero Apache Gaming Commission 

PO Box 329 

Mescalero, NM 88340 

FAX: (505) 464-4129 

1. Notification of Violation 

The Chairman of the National Indian Gaming Commission ("NIGC") hereby gives notice 

that the Mescalero Apache Tribe ("Respondent" or "Tribe"), located in Mescalero, New 

Mexico, is in violation of NIGC regulations for failure to submit a timely annual audit 

report and failure to submit timely quarterly statements and fees. 

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 the Indian Gaming Regulatory Act ("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. 

§ 271O(b)(2)(C). 

B. 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 

gaming operation's fiscal year. 25 C.F.R. $$ 57 1.12 and 571.1 3. 

C. NIGC regulations require that each gaming operation on Indian lands compute 

quarterly statements determining the amount of fees owed to the Commission. 

The quarterly statements are due on March 31, June 30, September 30, and 

December 31 of each calendar year the gaming operation is subject to the 

jurisdiction of the NIGC. The quarterly statements shall be transmitted to the 

NIGC and arrive no later than the due date. 25 C.F.R. $5 514.l(c) and 

5 14.1 (~)(2)-(4). 

D. NIGC regulations require each gaming operation to remit to the NIGC the fees 

due each quarter with the quarterly statement. 25 C.F.R. fj 514.1(~)(5). 

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 and render an opinion on the financial statements prepared in conformity with 

generally accepted accounting principals 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. Role of Quarterly Fees and Quarterly Statements 

The annual fees collected by the NIGC to fund the agency's work are based upon the 

quarterly worksheets submitted by Indian gaming operations. NIGC must set a fee rate 

suEcient to hd its annual budget, yet may not exceed the fee cap set by Congress. 

Thus, it is imperative that the NIGC receive worksheets from the gaming operations in a 

timely manner so that the NIGC is able to set accurate preliminary and final fee rates. 

6. Circumstances of the Violation 

A. Respondent is a federally recognized Indian Tribe with tribal headquarters in 

Mescalero, New Mexico. 

B. Respondent operated its gaming facilities, Casino Apache and Inn of the 

Mountain Gods Resort and Casino, during all or part of the following years: 2003, 

2004 and 2005. 
C. The NIGC has not received an audit report for Casino Apache and Inn of the 

Mountain Gods for the fiscal year ending April 30, 2005. The audit report was 

due to the NIGC on August 29, 2005, 120 days after the end of the gaming 

operation's fiscal year. 

D. The MGC has received untimely quarterly statements and fee payments for the 

quarters up to December 3 1,2004 as follows: 

C)uarter: Due: Received: 

6. Measures Required to Correct these Violations 

It is impossible for the Tribe to correct the untimely submission of the audit report. The 

audit report was due by August 29,2005 and it was not received by that date. In fact, the 

NIGC has yet to receive the audit report. Despite the impossibility of correcting the 

violation, the Tribe must nevertheless submit the fiscal year 2005 audit report to the 

NIGC. 

The untimely submission of the quarterly statements and fee payments is likewise 

impossible to correct. The statements and payments were due on specific dates and were 

not received on those dates. 

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. Lf 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. 

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 may submit written information about the violation to the Chairman within 

15 days after service of this notice of violation (or such longer period as the Chairman of 

the Commission may grant for good cause). The Chairman shall consider any 

information submitted in determining the facts surrounding the violation and the amount 

of the civil fine, if any. 

Chairman 

National Indian Gaming Commission 

Staff Attorney 
Certificate of Service 

I certify that this Notice of Violation was sent by facsimile and mailed VIA U.S. 

certified mail return receipt requested on this 3 1 st day of January, 2006 to: 

President Mark Chino (Agent for Service of Process) 

Mescalero Apache Tribe 

Box 227 

Mescalero, NM 88340 

FAX: (505) 564-9191 

Albert Apodoca, Executive Director 

Mescalero Apache Gaming Commission 

PO Box 329 

Mescalero, NM 88340 

FAX: (505) 464-4 1 29