Rep. Matthew Lesser and Gov. Dannel P. Malloy
Rep. Matthew Lesser and Gov. Dannel P. Malloy Keith M. Phaneuf /

The leaders of Connecticut’s federally recognized Indian tribes rallied Monday to Gov. Dannel P. Malloy’s defense, decrying the practice of an Oklahoma tribe and its business associates to make unlicensed, short-term loans here at astronomical rates.

The leaders of Connecticut’s Mashantucket Pequot and Mohegan tribes — who hope to win support from Malloy and the legislature to open at least one new gaming facility — also said they were approached by the Oklahoma tribe, but declined to participate in the controversial loan venture.

“It’s not the type of thing we consider to be good business,” Mohegan Tribal Chairman Kevin Brown said during an early afternoon press conference in the Legislative Office Building.

“We were approached,” Brown added, “and we told the folks we were not interested.”

Rodney Butler, chairman of the Mashantucket tribe, said that while “our commitment to tribal sovereignty is absolute…tribes and the entire (banking) industry should also ensure they are being responsible and that their customers can repay those loans without getting charged unreasonable fees and paying extremely high interest rates.”

Rep. Matthew Lesser, D-Middletown, co-chair of the legislature’s Banks Committee, said this is far from the case when it comes to two online lenders owned by the Otoe-Missouria tribe of Red Rock, Okla., which recently were ordered by Connecticut banking regulators to cease their practice of issuing short-term loans to Connecticut borrowers at annual rates as high as 448.76 percent.

Connecticut caps such loans at 12 percent, and the state Banking Department already has imposed a $700,000 fine on those lenders.

Lesser said Monday that his committee has raised a bill that would go one step further, and declare the most egregious loans “null and void,” adding that “we’re hoping to bring it up for a vote soon” before the House of Representatives.

The Malloy administration recently found itself the target of a marketing counter-attack funded, in part, by the Institute for Liberty, a national, conservative political group.

A billboard on Interstate 84 west of Hartford, as well as mailings and Internet postings on Twitter, try to depict the Democratic governor as interfering with the sovereignty of the Oklahoma tribe, and as preventing it from conducting business necessary for the tribe’s economic prosperity.

“Gov. Malloy, Don’t take away my future,” reads the headline over a photo of a Native American child” in the billboard and online ads.

Malloy fired back Monday that he wouldn’t allow political opponents to distort the situation or dissuade state officials from protecting Connecticut consumers.

“We wouldn’t allow the Swiss to do it, we wouldn’t allow the French to do it, we wouldn’t allow the Germans to do it,” the governor said of exorbitant loan rates that take advantage of the state’s poorest households desperately in need of immediate credit. “We shouldn’t allow anyone else to do it.”

Brown echoed Malloy’s sentiments, adding that rejecting this type of business practice “has nothing to do with denying Native American business, sovereignty or welfare, and everything to do with protecting the consumers of the state of Connecticut.”

Tribal chairmen Rodney Butler of the Mashantucket Pequots and Kevin P. Brown of the Mohegans
Tribal chairmen Rodney Butler of the Mashantucket Pequots and Kevin P. Brown of the Mohegans CTMIRROR.ORG

Brown’s tribe, which runs the Mohegan Sun casino, is seeking permission to open a new gaming facility in cooperation with the Mashantucket Pequots — who operate the Foxwoods Resorts Casino. Both tribes, who currently offer the only legal casino games in Connecticut, have warned they expect to lose thousands of jobs and hundreds of millions of dollars in annual revenue to increasing competition in neighboring states.

The out-of-state facility Brown and Butler have said is likely to pose the greatest threat to Connecticut’s gambling is the new MGM Grand casino under development in Springfield, Mass.

The legislature has raised a bill that would allow the tribes to open as many as three new facilities to combat these types of threats. Tribal leaders have said their immediate goal would be to open a gambling center in north-central Connecticut to combat the Springfield casino.

Malloy has not yet said what he would do if legislators send such a bill to his desk.

Keith has spent most of his 31 years as a reporter specializing in state government finances, analyzing such topics as income tax equity, waste in government and the complex funding systems behind Connecticut’s transportation and social services networks. He has been the state finances reporter at CT Mirror since it launched in 2010. Prior to joining CT Mirror Keith was State Capitol bureau chief for The Journal Inquirer of Manchester, a reporter for the Day of New London, and a former contributing writer to The New York Times. Keith is a graduate of and a former journalism instructor at the University of Connecticut.

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