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3 Former Tribal Officials Sentenced in Embezzlement Case

SACRAMENTO, Calif. (AP) — Three former officials of an American Indian tribe that runs a Northern California casino have each been sentenced to more than three years in prison for embezzling nearly $5 million from the tribe and using the money to fund luxurious lifestyles, federal prosecutors said.

John Crosby, 56, his mother Ines Crosby, 76, and her sister, Leslie Lohse, 67, stole money over five years from the Paskenta Tribe of Nomlaki Indians, which owns the Rolling Hills Casino north of Sacramento, prosecutors said.

John Crosby is a former FBI agent in Sacramento who was the tribe’s economic development director. His mother was the tribe’s administrator and his aunt was treasurer.

In 2019, all three pleaded guilty to conspiracy to embezzle or steal from a tribal organization. John Crosby and Lohse also pleaded guilty to filing a false tax return and Ines Crosby pleaded guilty to failing to file a tax return.

Prosecutors said the trio took more than $4.9 million of the tribe’s money and spent it on fancy homes, cars and other luxuries, including $243,000 for a swimming pool and spa at John Crosby’s house; $84,000 for a koi pond for Ines Crosby; and $150,000 to buy gold coins and other precious metals.

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Thousands more went to pay off credit cards, buy jewelry, handbags and beauty products and to pay for a World Series trip, chartered jet flights and vacations to Hawaii, New Zealand and other places.

“The defendants lived a lavish lifestyle at the expense of the Paskenta Tribe of Nomlaki Indians and were undeterred by the damage their conduct would bring to the Tribe, whose members trusted them with most of their crucial operational positions,” US Attorney Phillip Talbert said in a statement after Friday’s sentencing.

US District Judge John A. Mendez sentenced John Crosby, of Redding, to four years and nine months in prison and to pay a $10,000 fine; Ines Crosby, of Orland, to four years and nine months years in prison; and Lohse, of Glenn, to three years and five months in prison.

Lohse had paid $902,208 in restitution prior to Friday’s sentencing hearing, prosecutors said. A hearing will be held on April 19 to determine the amount of restitution John Crosby and Ines Crosby will pay, they said.

The Paskenta Tribe of Nomlaki Indians has about 300 members and its casino with its associated hotels, golf course and other amenities has been estimated to generate $100 million a year.

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