Ex-Tribal Official Convicted of Fraud

In more bad news for Connecticut’s Pequot Native American tribe that operates Foxwoods Resort Casino, a federal jury has convicted a former official of defrauding investors. He still has a related case pending in Mashantucket Pequot Tribal Court.

The U.S. Department of Justice issued a statement saying a jury in Hartford, Conn., found former tribal deputy COO Christopher Pearson guilty of eight counts of wire fraud Nov. 19.

Authorities said Pearson defrauded investors out of $280,000 that he promised to use to buy land on the island of Roatan, off Honduras. Pearson said the land would be used for a resort and casino the tribe was sponsoring.

Pearson used the money instead for his own use, including boats, cars, vacations and improvements to his waterfront home on Roatan.

Pearson faces up to 20 years in prison and fines of up to $250,000 on each count when he is sentenced Feb. 5.

He’s also been accused by the tribe of bilking a different group of six investors of $375,000, according to the Hartford Courant. A verdict in that trial could come before he is sentenced in federal court.

Investors were pitched a resort on Roatan that would turn the Caribbean island into the hemisphere’s top vacation destination, the paper said. The island paradise would include more than 100 acres of hotels, condos, time-share apartments, restaurants, marinas, cruise ship docks and other accoutrements including a desalinization plant and, of course, a casino.

Pearson was accused of raising money from investors by saying the Pequot tribe, already awash in debt from construction loans on Foxwoods Resort Casino, would sponsor the development.

Witnesses from the tribe testified it was not a sponsor, though some members – including Pearson’s own father – were among the allegedly ripped-off investors.

Federal prosecutors presented an accounting analysis that showed Pearson pocketed the money, which was transferred in sums of $25,000 to $50,000 straight into his checking account, according to the Courant.

Pearson’s grandmother was tribal matriarch Elizabeth George and his brother, Skip Hayward, reportedly started the legal and economic moves to reestablish the Pequots as a viable tribe and eventually open the massive Foxwoods Resort Casino.

He testified that he returned to Connecticut in 1992 just as Hayward was about to launch Foxwoods. Pearson made more than $300,000 per year in distributions as a member and deputy COO of the tribe.