The Hindu Business Line : A quarter billion records in a mammoth accounting reconciliation

Classified under `Culture' is this story, on http://washingtontimes.com, dated May 16: `Accounting for lost trust,' by John Heilprin of Associated Press. "What is ground zero for an accounting that will take seven years and cost $335 million owes its existence to a bitter class-action lawsuit brought against the Interior Department a decade ago," writes Heilprin.

His story is about a dispute dating back to 1887, when the US Government's Interior Department was made the trustee for 145 million acres of American Indian lands. For starters, the Department's job is to manage lands owned by the federal government, "mainly the administration of natural resources such as parks and wildlife," as educates Wikipedia.

"1877: Battle of the Little Big Horn, followed by defeat of Crazy Horse and end of Indian Wars. 1887: Dawes Act leads to land being parcelled up and sold off," narrates the timeline in a report by Chris Summers titled The great American land row dated August 25, 2003, on http://news.bbc.co.uk. Under the Dawes Act the land was divided into plots of between 160 and 180 acres, informs Summers in the story on the $137 billion lawsuit.

"Each Indian family was assigned a parcel of land, which was alien to their culture in which all land belonged to the tribe." The BBC story has, on the sidebar, a disturbing quote of Congressman Henry Dawes, the author of the Act: "To be civilised is... to wear civilised clothes, cultivate the ground, live in houses, ride in Studebaker wagons, send children to school, drink whiskey and own property."

Meet Elouise Cobell

Fast forward to more than a century, to June 10, 1996, when a class-action lawsuit was filed in the District Court in Washington, DC, seeking "reform of the trust system, and an accounting of money ostensibly held in the trusts," as www.indiantrust.com informs in a chronology of the case.

Protagonist in the action was Elouise Cobell, a banker from Browning, Montana. "She also served as Chairperson for the Blackfeet National Bank, the first national bank located on an Indian reservation and owned by a Native American tribe," informs www.lannan.org, in a page that speaks of `2005 Cultural Freedom Fellowship' awarded to Cobell.

"You know, when you are travelling on the airplane, travelling out to Washington and you talk to people on the plane, they always say, `What do you do?' If you say I am a banker, they look out the window and the clouds seem more interesting than you," is a quote of Cobell on www.virginia.edu. "But if you tell them `I am reforming the US government', they look at you and say `What! For real?' And you say yeah, because that is basically what we are doing with this lawsuit is we're reforming the US government."

Sadly, the US' relationship with the Indian tribes has been contentious and tragic, conceded the US DC Circuit Court of Appeals in a February 2001 decision, which was just one more in a line of verdicts. "America's expansionist impulse in its formative years led to the removal and relocation of many tribes, often by treaty but also by force."

Trail of tears

To know more about the horrors of those days, visit www.legendsofamerica.com. `The Cherokee Trail of Tears,' for instance, chronicles how "during the forced march, over 4,000 of the 15,000 Indians died of hunger, disease, cold, and exhaustion," in the early nineteenth century. After the `deadline for voluntary removal' lapsed on May 23, 1838, `forcible evacuation at gunpoint' began. "The swift and brutal process drove men, women and children out of their homes, sometimes with only the clothes on their backs. They were then gathered in camps where conditions were terrible. Many of the Cherokee died while waiting in the camps, where food and supplies were limited and disease was rampant... " The weakness of the enemy makes our strength, is a Cherokee proverb that should have acted in favour of the US vis-à-vis the natives then.

Resuming the Cobell story, you'd learn that there are two types of trust accounts, viz. the tribal trust account, and individual Indian trust accounts. And the two didn't reconcile by whopping numbers, and it was evident that the whole system had crumbled. "There was tons of mismanagement, fraud, and embezzlement. We are uncovering things that would shock you. Probably after the case more of it will come out," is more of Cobell-speak from www.virginia.edu. "There was no way that we wanted to go criminally after somebody and convict them," she adds. "We wanted to go after to tell the US government to do the right thing... to put in place accounting systems." Let's now move on to a recent `progress report' on `Historical accounting for individual Indian monies'. The 28-page document is available on www.doi.gov, the site of the Department of Interior. "For several years, the Department of the Interior has been involved in an accounting project of unprecedented proportions," begins Gale A. Norton in her `Message from the Secretary'.

A $12-billion job

"Among other things, Interior has been ordered by the district court in Cobell vs Norton to document every dollar it has received and disbursed on behalf of individual Indians since 1887 — a task that encompasses billions of dollars, hundreds of thousands of accounts, and tens of millions of account transactions." What are the resources necessary to accomplish this task? "Staggering — estimated at more than $12 billion." About "a quarter of a billion pages of Indian records have been collected and electronically indexed," informs Norton. "Over 8 million relevant pages, some dating to the 1910s, digitally imaged and coded for search and retrieval."

The brochure explains the basics of `historical accounting': "Although much of the allotted lands has transferred from Indian ownership since 1887, individual Indians today own approximately 3.2 million undivided interests in approximately 10 million acres of trust lands. Because an individual Indian may inherit interests from several different ancestors, the total number of individuals who own interests is considerably smaller than the number of interests — only about 225,000... "

The Department has used statistical samples and drawn conclusions "with a high degree of confidence about the overall accuracy of the transactions in the Land-Based IIM accounts covering the 1985-2000 period". What's the conclusion? "That the difference rates for all disbursement and deposit transactions are very small, and that the vast majority of these differences are less than $10."

Interior's accounting experts have uncovered no evidence of fraud or widespread systemic error in the US government's handling of the individual Indian monies (IIM) accounts, and the few errors that have been found are generally small in monetary value, declares Norton.

"It is better to have less thunder in the mouth and more lightning in the hand," is an Apache saying, in a list of `Native American Proverbs and Wisdom' on www.legendsofamerica.com. But Norton's lightning assertion has only fallen like thunder on the ears of the aggrieved.

Naturally, from the side of the plaintiffs, the criticism is that the report is `deceptively inaccurate from beginning to end'. Their 8-page counter notes: "The sad fact is that the government has `reconciled' less than one-half of one per cent of the transactions and accounts for which it is legally and morally responsible. Even more to the point, `reconciling' is not `accounting.' Interior considers a transaction to be `reconciled' even if no confirming documents whatsoever can be found."

A mammoth task such as this may be the right candidate for outsourcing. To India, if I may suggest. For, who knows Indians better than Indians?

http://AccountSpeak.blogspot.com

D. Murali

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