The Wall Street Journal has alleged that high-profile political figures are embroiled in a stake-sharing scheme involving an tribal operator. The newspaper reports that a company profiting from the new Catawba Two Kings Casino has given shares to politicians.
One of the recipients of these shares is John B. Clyburn, brother to Representative James Clyburn, the powerful South Carolina Democrat who paved the way for the new North Carolina casino.
Other shares in the Catawba casino have gone to Michael Haley, husband of former South Carolina Governor Nikki Haley, the Trump Administration ambassador to the UN. Shares were also allocated to Butch Bowers, a lawyer who has represented both Haley and former President Donald Trump.
The stakes, held indirectly through a third-party entity, give each of the recipients a ‘slice’ of a slot-machine leasing company called Kings Mountain Equipment Supply.
The company gets a fifth of the pay-off from every slot machine in the Catawba casino, which houses hundreds of machines. The recipients have shareholdings of less than 1% and deny any accusations of a ‘quid pro quo’ arrangement.
Suspicions around this shareholding scheme are raised due to how the casino was given the legal green light. The project was considered a long shot for the Catawba Indian Nation, a tribe that had been banned from offering gambling. It had failed to open a casino in North Carolina after trying for over a decade.
However, after having the project rejected by the Trump Administration it was given the go-ahead in 2020 – and the reasons why remain shady. John Clyburn says he was ‘surprised’ to start receiving seven to eight checks from the casino a year ago; he also claims he had no involvement in regulatory approval for the casino.
However, as University of North Dakota tribal-gaming expert Steven Light commented, “This is an outlier – in the degree of political involvement, the involvement by Congress, the amount of time it took and the unusual nature by which the Interior Department decisions were reversed.”
Rep. James Clyburn denies any corruption allegations, saying his brother’s profiteering off of his decision was a matter of coincidence: “He gets to make a living. I don’t get his permission, and I don’t give him mine.” The Catawba tribal representative Bill Harris also denied any wrongdoing, saying that John Clyburn’s involvement in the project was brief, transparent and public.