SEI tapped for Bureau of Indian Affairs financial system
- By L. Scott Tillett, L. Scott Tillett
- Apr 12, 1998
Interior Department officials last week announced they had chosen SEI Investments to replace a beleaguered in-house system that the agency has used for decades to manage billions of trust dollars for American Indians.
The department maintains almost 350,000 trust accounts for American Indians and Indian tribes. Money in the accounts comes from the lease or sale of resources on nearly 54 million acres of land owned by American Indians and the tribes. Interior estimated the value of the trust funds at $3 billion. The department manages the accounts with a system that was developed internally and that has been in place since 1977.
But American Indians have criticized the system, called the Integrated Records Management System, claiming it is riddled with inaccuracies and missing information, making it impossible for them to know how much money they have in their trust accounts.
Elouise Cobell, the lead plaintiff in an ongoing class-action lawsuit that calls on Interior to provide a proper accounting of American Indian trust dollars, said the move to choose a vendor to handle trust information management is a move in the right direction. But she said the lawsuit will continue because a new system will not necessarily reconcile funds that went unpaid to American Indians in the past.
"Basically, we're starting from scratch because the government has gotten away with giving no accounting to individual Indians," said Cobell, a member of the Blackfeet tribe. Interior officials "don't have an accounting system.... They can't tell me where my land is. They can't tell me what I should be getting for it."
Focus on Education
Jim McCarthy, spokesman for the Individual Indian Monies Trust Recovery Project, a group affiliated with Cobell, said that despite the contract, problems in managing trust information will persist if Interior does not focus more on computer literacy and financial management education for federal employees.
Interior officials agreed that the current system for trust accounting is plagued with problems. "It's rapidly becoming obsolete, [is] not maintained [and is] poorly documented," said Thomas Thompson, operations deputy special trustee for American Indians at Interior. Thompson said past attempts at reconciling information in the system have turned up an overall discrepancy of $50 million, and information on thousands of transactions has been lost. "The books generally are a disaster.... It's a maintenance nightmare," he said.
Thompson added that getting the agency's trust systems in order is important so that Interior can live up to its mission. "At this point, we cannot prove in a court of law that we are meeting our trust responsibilities," he said.
Under the new contract, which is valued at $50 million over five years, about 150 federal offices nationwide will use special SEI software to connect electronically with the company's data center in Wayne, Pa., when it comes time to record trust-related transactions. Cobell explained that the current process of managing information is a patchwork of paper and electronic transactions.
"[The contract] gives them a state-of-the-art system where they don't have to worry about the future," said Richard Lieb, president of SEI's Investment Systems and Services Division. "We now have all the problems."