Chapter seeks probe, audit

By Kathy Helms
Diné Bureau

WINDOW ROCK — The Shiprock Chapter has certified a resolution requesting an investigation and audit of Shiprock BCDS Manufacturing Inc. and the expenditure and use of $2.2 million from the Navajo Dam Escrow Account.

According to the resolution, the chapter has asked the Navajo Nation Council's Budget and Finance Committee, the Ethics and Rules Committee, the Navajo and U.S. Departments of Justice and the Auditor General's Office for the investigation and audit, and that a report of their findings be given to the Chapter.

The Navajo Dam Escrow Account was established by the tribal council with the funds to be used solely for the purpose of collateralizing loans to Navajo entities within San Juan County or chapters within Shiprock Northern Agency for economic development projects.

BCDS (Bio Chemical Decontamination Systems) is a joint venture corporation with the Navajo Nation, with Navajo owning 51 percent. The resolution states that under the lease and corporation agreement, the Nation is required to receive 51 percent of all income and profits of BCDS.

BCDS submitted a proposal to Budget and Finance and the Navajo Dam Escrow Fund Selection Committee for a construction expansion project and was awarded $2.2 million from the escrow account around Sept. 2, 2006.

According to the resolution, the $2.2 million was to be used as collateral for a loan to finance construction of a 100,000-square-foot industrial facility and operation expansion, allowing for the hiring of approximately 100 Navajo workers.

The Chapter alleges that nine months have elapsed, there is no plan for expansion, and some of the workers have been laid off.

"There is information surrounding the Shiprock Community that the $2.2 million is depleted and the funds were misused. As a result, there are allegations (and) appearance of impropriety over the expenditure and use of $2.2 million Escrow funds," the resolution states.

The resolution calls for investigation into whether BCDS was issued a cease-and-desist order regarding improper use of a patent design in trailer manufacturing which resulted in the trailer manufacturing operation being shut down and the welders laid off.

The Chapter further requested that the Navajo Nation's 51 percent financial profit sharing be audited and that the Navajo Nation form a new board of directors which would have oversight authority of the expenditure of funds and operation of Shiprock BCDS Manufacturing Inc.

The resolution was passed by the chapter May 20 by a vote of 24-7-7.

According to the BCDS Mfg. Inc. business plan, dated April 8, 2005, BCDS was established in January 2004 as a joint venture between the Navajo Nation and the owners of BCDS Inc., Bio Chemical Decontamination Systems of Durango, Colo.

BCDS Mfg. Inc. was created to provide professional goods and services for the U.S. Department of Defense. The plan listed owners of BCDS Inc. as Jerry Dickenson, Hak Ghun, and Ret. Gen. Ron Fogelman. Dickenson and Ghun are brothers, born in Seoul, Korea.

Ret. Gen. Fogleman served as the 15th Chief of Staff of the U.S. Air Force and was Commander in Chief of the U.S. Transportation Command. As a member of the Joint Chiefs of Staff, he served as a military adviser to the Secretary of Defense, the National Security Council, and the president of the United States.

According to their resumes, Dickenson, President of BCDS Inc. and BCDS Mfg. Inc., formerly worked as an Emergency Medical Technician and professional ski patroller at Durango Mountain Resort, and as an assistant golf professional at Dalton Ranch Golf Club in Durango.

Ghun formerly worked as a contractor/consultant to a number of companies in the biological/chemical decontamination field and commercialized a decontamination formula from Sandia National Laboratory. He also states that he served as a personnel assistant to Colin Powell while in the U.S. Army.

Ghun stated in a 2003 resume to Allen Begay, executive director of the Navajo Division of Economic Development, that he was owner and operator of Nelson, Ghun & Associates, a Wall Street firm, during 1976-1982.

According to a May 15, 1984, article by the Associated Press, Ghun and six other businessmen were charged May 14, 1984, with "bilking 1,200 investors out of $11 million by promising big profits on commodity futures traded by the Wall Street firm of Nelson, Ghun & Associates."

The defendants were charged in a 46-count indictment with mail fraud and wire fraud, punishable by up to five years in prison. The article states that co-owners George Nelson, then 35, of Manhattan, and Hak Ghun, then 34, of Colorado Springs, also were charged with commodity fraud and perjury.

An Oct. 2, 2006, article in Forbes Magazine on Neal Wolkoff, CEO of the American Stock Exchange and "Wall Street's Mr. Clean," referred to the case against commodities trader Nelson, Ghun & Associates. The article states that as a market cop at the Commodities Futures Trading Commission, Wolkoff worked on the case in which the firm was accused of churning customer accounts, and four partners went to jail. The partners were not named.

The CFTC lists six docket numbers for "Reparations Sanctions in Effect" in its Feb. 6, 2006, Book 1, for Ghun and 20 docket numbers for Nelson, Ghun & Associates.

The BCDS Mfg. Inc.'s 2005 business plan lists the board of directors as Dickenson, Ghun and Fogleman, as well as Economic Development's Begay, Shiprock Chapter President Duane "Chili" Yazzie, and BCDS Mfg. Inc.'s Chief Financial Officer, Lori Todacheene.

According to the business plan, the Navajo Industrial Development Center in Shiprock, owned and operated by BCDS Mfg. Inc., is a facility designed to obtain government contracts with its engineering and manufacturing, metal-fabrication plant. The 30,000-square-foot building, owned by the Navajo Nation, was equipped and redesigned by BCDS Mfg. Inc. to be a second-to-none metal fabrication facility with high-tech corporate offices.

BCDS Mfg. Inc. was awarded its first government contract in March 2005. The company also was awarded $49,248 on April 3, 2007, through the contracting office of the U.S. Army Tank Automotive and Armaments Command for military armored vehicle, tank and tank component manufacturing.