You are here

Justice News

Department of Justice
U.S. Attorney’s Office
Eastern District of California

FOR IMMEDIATE RELEASE
Thursday, January 5, 2017

Former Tribal Officials and Employees Charged with Embezzling $6 Million from Paskenta Band of Nomlaki Indians

SACRAMENTO, Calif. — A federal grand jury returned a 69-count indictment today against John A. Crosby, 53, of Redding; Ines S. Crosby, 73, of Orland; and Leslie A. Lohse, 62, of Glenn County, charging them with conspiracy to embezzle tribal funds, embezzlement of tribal funds, false statements to federal agents, and tax charges, U.S. Attorney Phillip A. Talbert announced.

According to court documents, John Crosby, Ines Crosby, and Leslie Lohse were officers and employees of the Paskenta Band of Nomlaki Indians in Tehama and Glenn Counties. The Tribe obtained substantial revenues from the operation of the Rolling Hills Casino located on tribal land. Between January 2009 and May 2014, the defendants, who had access to tribal funds, used that money for their own personal expenses. They sought to conceal the embezzlement, including creating a false line-of-credit document and remotely accessing the Tribe’s computers to destroy evidence.

According to the indictment, in June 2015 during the investigation, each defendant falsely stated to a federal agent that they had received a $5 million line of credit from the Tribe. Further, John Crosby and Leslie Lohse submitted tax returns that omitted the embezzled funds. For her part, Ines Crosby failed to file any tax returns. It is estimated that the defendants embezzled at least $6 million in tribal funds.

This case is the product of an investigation by the Internal Revenue Service-Criminal Investigation and the Federal Bureau of Investigation. Assistant U.S. Attorneys Todd A. Pickles and Matthew M. Yelovich are prosecuting the case.

If convicted, each of the defendants face a maximum statutory penalty of 20 years in prison and a $250,000 fine on the charge of falsifying a document in a federal investigation. The maximum statutory penalty for each count of conspiracy, embezzling, and making a false statement to a government agent is five years in prison and a $250,000 fine. The maximum statutory penalty for filing a false tax return is three years in prison and a $25,000 fine, and one year in prison and a $25,000 fine for failure to file a tax return. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.

Topic(s): 
Financial Fraud
Indian Country Law and Justice
Tax
Press Release Number: 
2:17-cr-006 TLN:
Updated January 5, 2017