NIGC Investigation Finds Catawba Nation Violated Indian Gaming Law
The Catawba Two Kings Casino faces a substantial fine and a potential temporary closure after federal regulators determined the Catawba Indian Nation and one of its partners in the North Carolina casino violated the Indian Gaming Regulatory Act (IGRA).
In a 30-page letter dated Tuesday to the tribal nation, members of its gaming commission and gaming authority, and representatives of Kings Mountain Sky Boat Partners, the National Indian Gaming Commission (NIGC) said that Catawba leaders let Sky Boat “manage in part” the casino’s expansion without the commission signing off on the arrangement. In addition, the NIGC also cited the parties for not submitting their contract within 60 days after executing it.
Based on an exhaustive investigation and analysis of the circumstances, we issued a Notice of Violation to both enforce regulatory compliance and ensure the Nation is the primary beneficiary of its gaming revenue,” NIGC Chairman E. Sequoyah Simermeyer said. “We do not take this enforcement action lightly but do so to preserve the integrity of the industry and protect the valuable tool Indian Gaming represents for many Tribes as codified in the Indian Gaming Regulatory Act.”
According to the NIGC, the parties – including owners and other representatives of Sky Boat – face fines of up to $57,527 per day for each violation. The commission may also impose a temporary closure order on the casino.
Two Kings is currently operating in a temporary facility in Kings Mountain, which is about 30 miles west of Charlotte.
NIGC Warned Catawba
The temporary casino opened on July 1, 2021. That’s the same day that Sky Boat exercised rights under a lease agreement between the two sides, and it’s also the same day Catawba officials received a letter of concern from NIGC compliance staff regarding the Sky Boat agreement.
Compliance staff told Catawba leaders that the Sky Boat deal needed to be reviewed by the NIGC chairman. Despite that warning, Sky Boat maintained a management presence at the casino through Nov. 4, 2021. The commission said that Sky Boat representatives oversaw the modular expansion of the temporary casino. That included negotiating contracts, serving as the point of contact, and managing payment for the modular buildings.
If the NIGC were to fine the tribe and others involved for each of the 127 days they were found to violate federal gaming laws, the parties could be forced to pay $7.3 million for each violation.
The parties have the right to appeal the commission’s findings but must do so within 30 days.
In a statement on its Facebook page, the Catawba Nation told its citizens that it received a letter from the commission “regarding their concerns over some of our contracts” for the casino.
“As we have stated many times to the General Council and to the media, we are actively working with the NIGC to resolve these issues as quickly as possible,” the statement continued. “The issues do not involve current casino operations.”
A Catawba spokesperson declined to provide further comment to Casino.org on Wednesday evening.
Investigation Previously Reported
The Catawba Nation is a South Carolina-based tribe, but it was able to secure land for its casino in North Carolina. Late last year, Congress passed a bill, and President Biden signed it into law that kept the Eastern Band of Cherokee Indians, a North Carolina-based tribal nation that operates two casinos in the state, from challenging the Catawba proposal in court.
Back in July, the Wall Street Journal reported that the NIGC was investigating the plans for the casino and that inquiry was delaying construction on the permanent $273 million resort slated for Kings Mountain.
The tribe called it a “standard investigation” at the time.
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