1 AationaI 3nbian Oaming Gommi~ston 

NOTICE OF VIOLATION AND CLOSURE ORDER 

Ref: NOV No. 02-03 

CO NO. 02-03 

To: Chairman Bennett Arkeketa 

Ponca Tribe of Oklahoma 

20 White Eagle Drive 

Ponca City, OK 74601 

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

that the Ponca Tribe of Oklahoma (Respondent), located in Ponca City, Oklahoma, is in 

substantial violation of the Indian Gaming Regulatory Act (IGRA) and NIGC regulations.' 

2. Respondent is a federally recognized Indian Tribe with tribal headquarters in Ponca City, 

Oklahoma. Respondent has engaged in gaming operations on tribal lands in Oklahoma since 

approximately 1992. Following implementation of IGRA, the Chairman of the NIGC approved i Respondent's Gaming Ordinance on May 3,1995. 

3. Under the authority of IGRA and the NIGC regulations, the NIGC issued a Potential 

Notice of Violation (PNOV) to Respondent on November 3, 2000, for not submitting required 

fkgerprints, applications, investigative reports, and suitability determinations to the NIGC for 

Key Employees and Primary Management Officials employed at Respondent's gaming facility, 

Blue Star Casino. The PNOV gave Respondent thirty (30) days to submit fingerprints, gaming 

employee applications, and investigative reports. 

4. Several NIGC representatives met with Respondent's governmental and gaming officials 

during the next year, but little progress was made by Respondent to provide the required 

employee documentation. In addition, on January 8,2002, Respondent requested an extension of 

the deadline of its Minimum Internal Control Standards (MICS) audit. 

5. By letter to Respondent dated February 20, 2002, the NIGC General Counsel urged 

Respondent to close voluntarily its gaming facility, citing its failure to submit background 

investigations, noncompliance with the MICS, and failure to submit its 2001 audit. 

The NIGC regulations are set forth in Chapter III, Title 25, Parts 500-599 of the Code of Federal 

I Regulations. All sections of MGC regulations cited in this Notice refer to the pertinent parts of Title 25. The NIGC 

regulations implement provisions of the Indian Gaming Regulatory Act (IGRA), 25 U.S.C. $5 2701-2721, signed 

into law on October 17, 1988. 
6. Respondent notified the NIGC by letter dated February 27, 2002, that it would 

voluntarily close its gaming facility on March 3,2002. Although Respondent closed its facility 

as it agreed on March 3, 2002, and continued to work with MGC staff to address numerous 

concerns, Respondent reopened the facility on April 12, 2002, without correcting the conditions 

that precipitated the closing. 

7. The circumstances of the substantial violation are the following: 

A. Failure to Conduct Background Investigations and Submit Reports to NIGC 

Pursuant to 25 U.S.C. 8 2710(F), 25 C.F.R. 8 556.4, and Section 303.I.A of 

Respondent's 1995 Gaming Ordinance, the Tribe is responsible for performing a 

background investigation for each Primary Management Official and Key 

Employee of a gaming operation. Under 25 C.F.R. 8 556.5(b), and Section 

303.1.B of the Tribe's Gaming Ordjnance, the Tribe must forward a report to the 

NIGC on each background investigation before issuing a license to a Primary 

Management Official or to a Key Employee. This report must be submitted to the 

NIGC within sixty (60) days after an employee begins work, pursuant to 

25 C.F.R. 5 558.3 (b) and 303.1.B (3). Despite repeated requests fiom the NIGC, 

the Tribe has failed to conduct background investigations or to submit adequate 

reports on background investigations for the approximately ten (10) Key 

Employees or Primary Management Officials who have worked at Respondent's 

gaming facility for a period of longer than ninety (90) days. 

B. Failure to Submit Applications to NIGC 

Under 25 U.S.C. 5 27100 and 25 C.F.R. 8 556.5(a), a tribe that employs Primary 

Management Officials or Key Employees in its gaming operation must forward to 

the NIGC a completed application for each such employee. Submission of 

completed applications for Key Employees and Primary Management Officials is 

also required under Sections 303.1.A and 303.1.B of the Tribe's Gaming 

Ordinance. No applications have been submitted for approximately ten (10) Key 

Employees or Primary Management Officials who currently work in 

Respondent's gaming facility. 

C. Failure to Maintain Records 

Under 25 C.F.R. 5 558.1 (c), a tribe must retain applications for employment and 

reports of background investigations of Key Employees and Primary Management 

Officials for at least three (3) years fiom the date of termination of employment. 

The oldest record maintained by Respondent was dated March 10, 2001. 

Respondent was unable to produce any such records created prior to March 10, 

2001, despite having operated the facility since approximately 1992. 
8. The process of submission of applications, background investigations, and licensure of 

Key Employees and Primary Management Officials is crucial to maintaining the integrity of 

Indian gaming. Gaming is a cash intensive business that requires a carefully screened employee 

base and carehl implementation of internal controls. The background investigation and licensure 

process helps insure that employees who have access to cash and other gaming resources are 

worthy of positions of trust. Accordingly, under IGRA, the licensure of Key Employees and 

Primary Management Officials is a key tribal governmental responsibility. Because the lack of 

compliance with background investigations and licensure requirements at Respondent's gaming - 

facility is pervasive and involves a majority of the gaming employees, closure of only a portion 

of the operation would not adequately address the serious risks to the integrity of Indian gaming 

posed by the Respondent's non-compliant gaming facility. Under these circumstances, closure 

of all gaming activities is the only means of assuring the integrity of Indian gaming until 

Respondent institutes an adequate system for background investigations and licensure. 

9. Closure Order. To correct the violations, Respondent shall comply with the following 

closure order: 

Under the authority of 25 U.S.C. $5 2701 et seq. and 25 C.F.R 5 573.6(a) and (b), the 

Chairman of the National Indian Gaming Commission hereby gives notice that the Ponca 

Tribe of Oklahoma is ordered to cease operation of all gaming activities in its gaming 

facility. This order shall be effective within twenty-four hours of receipt of this Notice of 

Violation and Closure Order. 

10. The Chairman may rescind the Closure Order for good cause shown. 

11. Expedited Review. Under 25 C.F.R. $ 573.6(c), within seven (7) days after service of , 

this Order, Respondent may request, orally or in writing, informal expedited review by the 

Chairman. The Chairman must complete such review within two (2) days after receipt of a 

timely request. Within two (2) days after the expedited review provided by 25 C.F.R. 573.6(c), 

the Chairman must decide whether to continue the Order and must provide Respondent with an 

explanation of the basis for the decision. 

12. Appeal. 

A. Whether or not Respondent seeks the informal expedited review described in 

paragraph ten (10) above, within thirty (30) days after service of this Notice of Violation and 

Order of Temporary Closure, Respondent may apped to the fill Commission under 25 C.F.R. 

Part 577 by submitting a notice of apped and, if desired, a 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 refer 

to this Notice of Violation and Order. 

B. 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, 

3 
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. 

13. Fine--Submission of Information. The violations cited above may additionally result in 

the assessment of civil fines against Respondent in an amount not to exceed $25,000 per 

violation per day. Under 25 C.F.R. 8 575.5(a), Respondent may submit written information 

about the violation to the Chairman within fifteen (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. 

Dated this lSt day of May 2002. 

Montie R. Deer, Chairman 

National Indian Gaming Commission 

Sandra J. Ashton 

Staff Attorney 
CERTIFICATE OF SERVICE 

I certify that this NOTICE OF VIOLATION AM) CLOSURE ORDER has been sent by 

facsimile and Fax this lSt day of May 2002, to: 

Chairman Bennett Arkeketa 

Ponca Tribe of Oklahoma 

20 White Eagle Drive 

Ponca City, OK 74601 

Paralegal