NIGC Issues Notice of Violation for Failure to Submit Report

Washington DC, January 10, 2007 — The National Indian Gaming Commission (NIGC) issued a Notice of Violation (NOV) to the Kaw Nation of Oklahoma for failure to timely submit an Agreed Upon Procedures (AUP) Report, as required by NIGC regulations, 25 C.F.R. § 542.3(f). 

Under NIGC regulations, an independent certified public accountant must be retained to perform this report, which essentially verifies that a gaming operation is in compliance with minimum internal control standards.  Submission of the report is due within 120 days of a gaming operation’s fiscal year end.  The NIGC views such reports as critical to its mission of protecting the integrity of Indian gaming, because the testing and opinion required by AUP reports provide a certain level of assurance as to the security of tribal gaming revenues.  Since gaming transactions are based on cash or cash equivalents, gaming operations are generally considered to possess a high level of inherent risk.  AUP reports prepared and submitted on a timely basis are evidence of the integrity of gaming operations and, more specifically, of the adequacy of the internal control standards associated with gaming and gaming related transactions and activities. 

Here, the Kaw Nation was to submit an AUP report for its South Wind Casino to the NIGC within 120 days of its casino’s fiscal year end or May 31, 2006.  However, the NIGC did not receive the report until December 5, 2006.

Chairman Hogen commented “The current leadership of the Kaw Nation has been responsive to NIGC’s concerns in this regard, but in view of the Tribe’s delinquency of more that 180 days, an NOV at this time was merited.”

The NIGC is an independent regulatory agency established within the Department of the Interior pursuant to the Indian Gaming Regulatory Act of 1988.

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