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  Comments (1) Total Wednesday Apr. 23, 2014
Four Reach Plea Deals in Blackfeet Fraud Case
Onstad and Augare were the leaders of the Po'Ka Project, which went defunct in 2011
HELENA — Four of the five remaining defendants accused of defrauding a federally funded program to help troubled Blackfeet Indian youth have reached plea agreements with prosecutors, leaving only a former Oklahoma State University professor to face trial next month.

On Monday, federal prosecutors filed the plea agreements with Francis Onstad, Delyle "Shanny" Augare, Dorothy Still Smoking and Katheryn Sherman in U.S. District Court in Great Falls.

They, along with former professor Gary Conti and Charlotte New Breast, had been indicted on a total of 37 criminal counts. They are accused of embezzling money from the $9.3 million Po'Ka Project for at-risk children on the northwestern Montana reservation, and embellishing the Blackfeet tribe's contributions that were required to keep the federal money coming in for the program.

Onstad and Augare were the leaders of the Po'Ka Project, which went defunct in 2011. Onstad and Augare agreed to plead guilty to four counts: conspiracy to defraud the U.S., conspiracy to submit false claims against the U.S., theft of embezzlement from an Indian tribal government receiving federal funding and tax evasion.

The false claims and theft charges carry maximum prison sentences of 10 years each, while the fraud and tax evasion charges come with five-year maximum sentences.

"She decided a plea would be in her best interest," said Onstad's federal public defender, David Ness.

Augare's attorney, Colin Stephens, said the same thing Tuesday.

"He wanted to keep his family out of the newspapers any more than they've already been," Stephens said of Augare.

Augare's son, state Sen. Shannon Augare, last year pleaded guilty to charges of drunken driving, reckless driving and obstruction of a peace officer.

Still Smoking and Sherman, who had lesser roles in the program, each agreed to plead guilty to one count of conspiracy to submit false claims.

The U.S. attorney's office agreed to drop the other charges and to cap restitution at $1 million.

Assistant U.S. Attorney Carl Rostad declined to comment.

New Breast last month was sentenced to probation and ordered to pay $50,000 in restitution after she pleaded guilty to aiding and abetting theft from an organization receiving federal grant funds.

The final defendant is Conti, who was the national monitor for the Po'Ka Project.

The embezzlement charges include Onstad and Augare sending $475,078 to a business owned by Conti called Learning Associates between 2008 and 2011, using fake invoices to justify the payments.

Conti, in turn, kicked back more than $230,000 to a bank account in Cut Bank, from which Augare and Onstad drew more than $225,000 for their personal use, prosecutors said.

Conti, a retired Oklahoma State adult education professor, also is charged with concealing assets and property in bankruptcy proceedings in that state in 2009.

Conti has pleaded not guilty. His trial is scheduled for March 4.
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