OnSat wants audit stifled
Files suit to stop review by auditor

By Kathy Helms
Diné Bureau

WINDOW ROCK — OnSat Network Communications Inc., has filed suit in Window Rock District Court against Acting Auditor General Elizabeth Begay seeking a permanent injunction to stop her from further distributing or discussing "A Special Review of the Navajo Nation Payments to OnSat."

The special review formally released June 18, found that circumventing of controls led to more than $650,000 in questionable and improper payments to OnSat.

Jim Fitting, OnSat's attorney and a member of the Albuquerque law firm Leubben-Johnson & Barnhouse-LLP, filed the complaint Friday. A hearing is set for 10 a.m. Monday, just as the Navajo Nation Council kicks off its summer session at which Navajo Nation President Joe Shirley Jr. is scheduled to present his State of the Nation address.

Fitting said Tuesday that the suit is to enjoin and to issue a permanent injunction to prevent Begay from "issuing the special review, or circulating it, or anything, until the issues of factual accuracy have been litigated."

"The judge has issued, as of last Friday, a temporary restraining order against her issuing it in any form or I believe, even talking about it," Fitting said. This means that Begay also cannot present the report to the Standing Committees of the Navajo Nation Council. If she does, "it puts her in contempt of court," he said.

Judge Allen Sloan issued the temporary restraining order at 4:10 p.m. Friday and will hear arguments Monday on whether to issue a permanent injunction to protect OnSat and "preserve the status quo" until the time of trial.

David Stephens, CEO and president of OnSat, said Tuesday that Sloan issued the TRO because he wants to see all of the facts.

"There's so much defamation going on. She's stepping so far out of her bounds," Stephens said. "They can just do and say these things without having any accountability or recourse. So the judge gave her a restraining order making her not able to discuss it with anybody but her attorneys."

Meanwhile, Attorney General Louis Denetsosie sent a letter to Fitting on June 6, stating that he does not have the consent of the Navajo Nation to represent OnSat and Shawn Redd in matters adverse to the Navajo Nation.

"I urge that you immediately cease and desist from your representation in the following matters," he said, referencing a May 18 Notice of Intent to Sue regarding the Navajo Nation audit of OnSat contracts and a Shawn Redd proposal for motor vehicle licensing.

"Your current activities violate the American Bar Association Model Rules of Professional Conduct," Denetsosie said. "In addition, your representation of OnSat and Shawn Redd in these matters violates the Navajo Nation Ethics in Government Law."

Denetsosie said that Fitting was personally involved in matters regarding OnSat and Redd's proposal for the creation of a Navajo Nation Motor Vehicle Authority at the time he worked as an attorney for the Navajo Department of Justice.

Fitting provided the Independent with copies of Denetsosie's letter and his June 18 response, stating that Denetsosie's allegations of conflicts of interest under ABA Rule 1.9 and related 2 N.N.C, "does not provide for the automatic disqualification of an attorney."

"They cited the wrong ethical rule, among other things," Fitting said Tuesday. "They're totally wrong on their facts."

"I had no involvement with OnSat while employed by the Navajo Nation, and certainly not the programs (Head Start, Public Safety, the Special Diabetes Project, and Community Development prior to 2005) that are the subject of the audit," he stated in the letter.

Stephens said Fitting is still representing him in the case against Begay. "They're (DOJ) throwing up smoke right now, literally," he said.

"The real issue is to get the truth out, not to find out who can represent and who can't. So we've also retained as co-counsel Bill Battles" of Window Rock.

Begay said the audit was conducted in accordance with Government Auditing Standards. However, Stephens said, "We're bringing in actual government and legal certified public accounting firms to actually show that she's not been following any standards, because she has no qualifications to even make those kinds of statements. But she's never been held accountable.

"A review is one thing. An audit has a whole different level of requirements. Everything she's talking about, saying that the president's office didn't do their job, the accounting department didn't do their job and all that as soon as you call it an audit, you have some very strict standards," he said.

"What really is interesting, and Patrick (Sandoval, chief of staff) said this to me the other day, he said, 'You know, I've got six or seven of these kind of reports going after other deals, other transactions, and other departments.' He said, 'This brings into question everything that she's done.'"