Office of Attorney General 2019 - 2021 Biennial Report (North Dakota)
Summary
The North Dakota Office of Attorney General’s 2019 - 2021 Biennial Report describes the elected office, established in the 1889 state Constitution, and its divisions, from general legal counsel and litigation to the Medicaid Fraud Control Unit, the State Fire Marshal and the North Dakota Lottery. Its Covid-19 section says attorneys advised Job Service North Dakota on fraud concerns and prevention as CARES Act funds were obligated, and advised on project contracts for the expenditure of approximately $33 million in CARES Act funding. The Medicaid Fraud Control Unit reports three complaints involving the improper use of Covid-19 stimulus checks by long term care facilities; once the Unit explained the law, the facility administrators returned the funds to the residents.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
Full text
OFFICE OF ATTORNEY GENERAL
2019 - 2021
Biennial Report
Contents
OFFICE OF ATTORNEY GENERAL.............................................................................1
THE ELECTED OFFICE .......................................................................................1
Duties and Functions. .................................................................................................... 1
Defects in the Law......................................................................................................... 2
Finances.......................................................................................................................... 2
Special Assistant Attorneys General............................................................................ 2
Human Trafficking Commission. ................................................................................... 3
Human Trafficking Grants. ..........................................................................................3
Civil Asset Forfeiture....................................................................................................... 3
REPRESENTING THE STATE ...........................................................................................4
GENERAL LEGAL COUNSEL ............................................................................4
Open Records & Meetings. .......................................................................................... 4
Legal Opinions. .............................................................................................................. 5
Legal Services................................................................................................................. 5
Administrative Rules....................................................................................................... 5
Covid-19 Pandemic....................................................................................................... 6
State Agencies...........................................................................................................6
State Boards. ..............................................................................................................6
Local Governments....................................................................................................6
LITIGATION .......................................................................................................7
Somerset Court............................................................................................................... 7
Burgum v. Jaeger........................................................................................................... 7
Spoofcard, LLC............................................................................................................... 8
Mickelson et al v. ND Department of Health.............................................................. 8
Election Lawsuits. ........................................................................................................... 8
Air Ambulance Lawsuit. ................................................................................................ 9
Open Meeting Lawsuits. ............................................................................................... 9
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Drake v. Stenehjem . .................................................................................................9
Schmitz v. State Board of Chiropractic Examiners. .....................................................9
ADMINISTRATIVE ACTIONS............................................................................10
Oil & Gas Hearings....................................................................................................... 10
Environmental Quality................................................................................................. 11
ENVIRONMENTAL LITIGATION .....................................................................11
Waters of the United States. ....................................................................................... 11
North Dakota v. US Army Corps of Engineers - Pipeline Protest Costs................... 11
Washington State Vapor Pressure Standards........................................................... 12
Water Supply Rule........................................................................................................ 13
SUPPORTING CRIMINAL JUSTICE. ........................................................................ 14
BUREAU OF CRIMINAL INVESTIGATION........................................................14
Drug Investigations . .................................................................................................... 14
K-9 Officers Jib and Jab.............................................................................................. 15
Internet Crimes Against Children (ICAC) ................................................................. 16
Sex Offender Registration.........................................................................................16
Use of Force Investigations. ........................................................................................ 16
Concealed Weapon Licenses. .................................................................................. 17
Clergy Sexual Abuse Investigation. ........................................................................... 17
CRIMINAL PROSECUTIONS............................................................................18
Habeas Cases.............................................................................................................. 18
Administrative Hearings............................................................................................... 19
MEDICAID FRAUD CONTROL UNIT. ..............................................................19
Criminal Cases. ............................................................................................................ 19
Covid-19 Complaints................................................................................................20
STATE FIRE MARSHAL......................................................................................20
Origin & Cause Investigations. ................................................................................... 20
Fire Investigation Equipment. ..................................................................................... 20
Portable X-Ray Imager. ............................................................................................21
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Photo Ionization Detectors. ......................................................................................21
Fire Incident Reports.................................................................................................... 21
CRIME LABORATORY ....................................................................................22
Drug Samples. .............................................................................................................. 22
Toxicology Samples. .................................................................................................... 22
DNA Samples................................................................................................................ 23
INFORMATION TECHNOLOGY .....................................................................23
Statewide Automated Victim Information & Notification ...................................... 23
Automated Fingerprint Identification Systems (AFIS )Update....................................23
PROTECTING CONSUMERS...................................................................................... 24
“Anti-trust” Laws .......................................................................................................... 24
Multi-state Lawsuits against Google. ........................................................................24
Consumer Complaints. ............................................................................................... 24
Enforcement Actions................................................................................................... 24
Do Not Call................................................................................................................... 25
Combating Illegal Robocalls...................................................................................... 25
CONSUMER FRAUD INVESTIGATIONS...........................................................26
Unlicensed Contractors. ............................................................................................. 26
Nicholas DeRosier, d/b/a Team Lawn Inc. and Vaughn Construction Inc................26
Cease & Desist Orders................................................................................................. 27
IMPOSTER SCAMS..........................................................................................28
REGULATORY ENFORCEMENT................................................................................ 29
Fire Safety and Prevention.......................................................................................... 29
Fire Safety Plan Reviews............................................................................................29
Fire Safety Inspections. .............................................................................................29
Licensing Section. ........................................................................................................ 29
GAMING.........................................................................................................30
Gaming Compliance.................................................................................................. 30
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Electronic Pull Tab Devices......................................................................................... 30
Powerhouse Gaming, Inc.........................................................................................31
Gaming Computer System......................................................................................... 31
NORTH DAKOTA LOTTERY. ............................................................................32
Lottery Ticket Sales....................................................................................................... 32
Prize Payouts................................................................................................................. 32
Lottery Promotion Success Stories.............................................................................. 32
Lucky for Life.............................................................................................................32
2by2. ........................................................................................................................33
Pick & Click Online Play Service................................................................................. 33
Lottery Proceeds.......................................................................................................... 33
BIENNIUM IN REVIEW. ................................................................................................. 34
Photos courtesy of North Dakota Tourism, the CDC, the employees of the Office of Attorney General, and open
source photos.
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OFFICE OF ATTORNEY GENERAL
THE ELECTED OFFICE
The Office of Attorney General was established in the 1889 state Constitution. The
agency is headed by the Attorney General, an independently elected constitutional
officer.
The Attorney General serves on The office also enforces the open
numerous boards and commissions, records and meetings law, and issues
including the Board of University and opinions in response to complaints of
School Lands, Industrial Commission alleged violations by a public entity.
(which oversees all state-owned
industries), PERS Board of Trustees, In addition to its legal duties, the Office
Judicial Council, and the Pardon of Attorney General has several divisions
Advisory Board. with regulatory or investigative functions:
The Attorney General also chairs the • The Bureau of Criminal
state’s Human Trafficking Commission Investigation Division assists local
and the Domestic Violence Fatality law enforcement agencies with
Review Commission. criminal and drug enforcement
investigations, leads the narcotics
task forces, maintains the
DUTIES AND FUNCTIONS criminal history and sex offender
The Attorney General represents the registration systems, and issues
state in all legal matters, civil and concealed weapons licenses.
criminal, where the state is named as a
party or the state may have an interest • The Consumer Protection and
in the outcome of the litigation. The Antitrust Division enforces the
office also provides legal services to state’s consumer fraud and "do
state entities and officials. not call" laws, investigates and
prosecutes consumer fraud cases,
The Attorney General issues opinions and enforces the state's anti-trust
to certain officials on questions of statutes.
law related to matters involving state
statutes, the state Constitution, and • The Crime Laboratory Division
matters having statewide significance. supports the criminal justice
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system through the analysis, Finances
identification, and comparison of
physical evidence for use in the • The agency’s biennial budget
investigation and prosecution of was $96.7 million, including state,
criminal offenses. federal and other funds.
• The Fire Marshal Division • The 2019-21 revenues collected
conducts arson investigations totaled $98.9 million.
and fire safety inspections,
regulates the sale, use, and
• The cost of defending and
storage of explosives, including
prosecuting actions on behalf of
fireworks, and conducts fire code
other state agencies by attorneys
compliance inspections of public
within the Office of Attorney
buildings, day care facilities, and
General totaled $3.1 million.
schools.
• The Gaming Division regulates Special Assistant Attorneys
charitable gaming and audits General
compliance with tribal-state
casino gaming compacts. Several state agencies either have their
own legal departments or statutory
authority to use private attorneys. These
• The Medicaid Fraud Control
attorneys are appointed as Special
Unit investigates allegations
Assistant Attorneys General (SAAG) but
of Medicaid fraud by medical
are paid by the hiring state agency.
professionals and patient abuse
at facilities receiving Medicaid
During the biennium, state agencies
funds.
paid $17.5 million to these SAAGs,
including:
• The North Dakota Lottery is
responsible for the day-to-day
• Workforce Safety & Insurance —
operation of the lottery and its
$4,543,026;
games.
• Tax Department — $618,826;
Defects in the Law
• University Systems — $552,793;
North Dakota Century Code §54-12-
and
05 requires the Attorney General to
“direct attention to any defect in the
practical operations of the law relating • Private Investigation and Security
to revenue and criminal offenses and Board — $196,024. ◘
shall suggest amendments and changes
as in the attorney general’s judgment
are necessary to subserve the public
interest.” ▲
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HUMAN TRAFFICKING $99,408.00; Community Violence
COMMISSION Intervention Center - $22,493.00;
Domestic Violence & Rape
The Attorney General’s Human Crisis Center - $54,021.00; Young
Trafficking Commission is charged with Women's Christian Association
collecting and evaluating data on - $89,628.00; Legal Services of
human trafficking activities in the state North Dakota - $166,034.00; Family
and promoting public awareness and Crisis Shelter - $23,850.00; Rape &
conducting training efforts. Abuse Crisis Center - $101,820.00;
North Dakota Council on Abused
Women's Services - $209,319.00.
HUMAN TRAFFICKING
COMMISSION
CIVIL ASSET FORFEITURE
The 66th Legislative Assembly
established a reporting requirement
for local law enforcement and county
state's attorneys regarding the status of
civil asset forfeiture proceedings, and
required the Attorney General to create
an annual report compiled from that
information.
The Attorney General's office partnered
with the Human Trafficking task force The first annual Civil Asset Forfeiture
in these efforts. In 2020, the task force Report was issued on November 1, 2020,
investigated 93 cases of human providing information about civil asset
sex trafficking, resulting in 13 victims forfeiture cases concluded, or forfeited
being identified and the arrest of five assets disposed of, during the previous
individuals. fiscal year.
Additional information on the task force Only ten of the state’s 53 counties
activities is available in the 2020 Report, reported having civil asset forfeiture
which can be found on the Attorney cases. Almost all items seized under
General's website. civil asset forfeiture fell into one of three
categories: currency, automobiles, or
firearms. For fiscal year 2019-2020,
Human Trafficking Grants
• $477,214 in currency was forfeited,
In 2019, the Legislature appropriated $1.4
and
million to provide grants to organizations
providing prevention and treatment
services related to human trafficking • Seven forfeited vehicles and two
victims. For the 2019-2021 biennium, the forfeited firearms were sold at
following grants were awarded: auction for a total of $30,141 and
$300, respectively.
• Youthworks Bismarck - $264,720;
The complete annual report is available
Youthworks Fargo - $258,706;
on the Attorney General’s website. ■
Abused Adult Resource Center -
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REPRESENTING THE STATE
GENERAL LEGAL COUNSEL
The State & Local Government Division provides general counsel legal services to more
than 70 state agencies, boards and commissions.
The division drafts Attorney General opinions, negotiates and reviews contracts
involving state entities, reviews all administrative rules adopted by state agencies, and
assists client agencies by drafting bills and amendments, explaining the ramifications
of proposed legislation, and testifying before legislative committees.
OPEN RECORDS &
MEETINGS
• 2020-O-08: COVID-19 CASE
The division handles a large number of
INFORMATION PROTECTED BY
telephone calls from public entities and
LAW. The Department of Health
citizens regarding open records and
did not violate the law when it
meetings requirements and conducts
declined to provide Information
presentations to state and local
relating to COVID-19 cases
government agencies and officials on
contained in protected disease
a public entity's obligations under the
control records.
open records and open meetings law.
The division issued 27 opinions • 2020-O-05: EXEMPTION FOR
addressing alleged violations of the ATTORNEY WORK PRODUCT.
open records or open meetings law, The City of Minot violated the
including: open records law when it did
not conduct a review of records
before claiming they were
• 2019-O-18: CITY RETREAT HELD
exempt as attorney work product.
OUTSIDE CITY’S JURISDICTION
The city was required to conduct
VIOLATED THE LAW. The City of
a review and release any records
Minot violated the law by holding
that did not have statutory
a meeting that was inaccessible
protections.
to the public when the city
council held its annual retreat at
a location approximately 70 miles
outside the city’s jurisdiction.
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LEGAL OPINIONS Legal Services
The State & Local Government Division Division attorneys advise and represent
issued 14 opinions on questions of the majority of state agencies and
law related to state statutes, the state professional licensing boards, providing
Constitution, and issues having statewide general counsel services, and legal
significance, including: assistance with regulatory compliance,
and licensing board disciplinary actions.
• 2019-L-09: ELIGIBILITY FOR SKILLED
WORKFORCE STUDENT LOAN In addition to providing training on open
REPAYMENT PROGRAM. The records and meetings requirements,
skilled workforce student loan division attorneys:
repayment program is available
to graduates of four-year • provided annual training to
institutions if all other eligibility more than 100 state licensing
requirements are met. board members on laws and
rules governing boards and
• 2020-L-03: COUNTY MAY board authority, and assisted
CONTRACT WITH STATE state boards in complex litigation
PENITENTIARY TO HOUSE regarding open records,
PRETRIAL DETAINEE. State law
provides authority for a county • advised the Board of Public
correctional facility to contract School Education and
with the ND DOCR to house a represented it in hearings relating
pretrial detainee who has unique to reorganizing and creating a
medical needs. new school district in the Williston
area,
• 2020-L-09: EFFECT OF VOTES CAST
FOR A DECEASED CANDIDATE FOR • advised the Department of
POLITICAL OFFICE. A deceased Career and Technical Education
candidate may be declared to on guidelines and procedures for
have been elected if a sufficient distribution of $70 million dollars in
number of votes were cast for grant funds, and
the candidate, but because a
deceased candidate would be • worked with the Legislature to
unable to discharge the duties of address questions and draft
the office at the specified time, amendments on numerous bills.
the office will be deemed vacant.
The Attorney General's Opinion governs Administrative Rules
the actions of public officials until
such time as the question presented is Division attorneys reviewed 97 sets of
decided by the courts. administrative rules for state agencies
and boards, addressing legislative
changes requiring regulatory updates. ◘
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COVID-19 PANDEMIC businesses and employers dealing
with the impact of Covid-19.
As general counsel for most
state agencies, boards, and Assisted JSND in ensuring federal
commissions, from the onset of CARES Act funds were obligated
the Covid-19 pandemic, attorneys timely and advised JSND regarding
in the State & Local Government fraud concerns and prevention, and
division have been called upon to trying to prevent any overpayment to
provide guidance and advice to assist claimants.
their client agencies in navigating the
ever-changing public health emergency. Advised ND ITD regarding project
contracts for the expenditure of
During the height of the state’s Covid-19 approximately $33 million in CARES Act
pandemic crisis these attorneys, all funding.
working remotely during the state’s
shutdown, were available to their clients Advised State Investment Board while
at all hours, to ensure these agencies navigating Covid-19 related investment
received timely assistance in response to losses and subsequent recoveries.
an emergent situation.
Advised NDPERS on extending certain
agency and member filing deadlines
State Agencies due to Covid-19, and procuring or
renewing various Uniform Group
Attorneys advised the Insurance Plans, including health,
Health Department on prescription drug, vision, and Medicare
executive orders; federal orders and part D.
guidance; evolving legal information
regarding the Covid-19 pandemic,
including drafting state health officer
State Boards
orders and numerous executive orders
related to the state’s Covid-19 response; Assisted the various regulatory licensing
negotiated the purchase of additional boards regarding executive orders
lab equipment, software, PPE, and and issues related to licensure during
testing supplies; and negotiated the Covid-19 pandemic, including
contracts addressing workforce advising the Education Standards and
shortages in the healthcare sector. Practices Board on executive orders and
emergency rules relating to the teacher
Advised the University System on federal shortage experienced during the
laws implemented for leave and pay, pandemic, and the Board of Respiratory
transitioning to online classes (and Care on licensing of respiratory therapists
moving back to in-person classes), during the pandemic.
advising on cleaning, masking, spacing
issues, transitioning to tele-health,
developing and implementing new Local Governments
policies to address Covid-19.
Provided assistance to local political
Advised the Department of Commerce subdivisions on their authority and issues
regarding the distribution of nearly related to the pandemic. ♦
$80 million dollars in grant funding for
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LITIGATION
The Civil Litigation and Natural Resources Division attorneys provide a wide variety
of legal services. The attorneys represent the state and state agencies and officials
in legal actions, including administrative and enforcement hearings, state court
lawsuits, federal court lawsuits, and appeals. The attorneys handle cases ranging
from challenges to the constitutionality of state laws to protecting the state's natural
resources from federal overreach.
Stenehjem Statement on Supreme
Court Decision in District 8 Election
Somerset Court Dispute
In April 2020, Somerset Court, an assisted November 24, 2020
living facility, and a cosmetologist
operating a salon within the facility, BISMARCK, ND - Today the North
brought a lawsuit challenging executive Dakota Supreme Court agreed with
orders issued by Governor Burgum the Attorney General’s October 13,
in response to the Covid-19 2020 Opinion, in which he opined a
pandemic that placed limits vacancy in the office of a District 8
on certain services requiring House of Representatives seat would
close contact with others. exist on December 1, 2020 as a result
of the tragic death of David Andahl.
A state district court dismissed
the case in September 2020, concluding The Court further agreed with the
the executive orders were within the Attorney General that a mechanism
Governor’s constitutional and statutory to fill the vacancy existed in current
authority, and the North Dakota law and the District 8 Republican
Supreme Court affirmed that decision in Executive Committee had the
April 2021. authority to fill the vacancy. The
Court rejected the Governor’s
argument that he had the authority
Burgum v. Jaeger to fill the vacancy. The Court also
In November, 2020, Governor Doug rejected Kathrin Volochenko’s
Burgum filed a petition for a writ of argument that, as the third place
mandamus with the North Dakota finisher, she was entitled to the office.
Supreme Court, claiming he had
the constitutional authority to fill a “The Court’s decision today affirmed
vacancy in the North Dakota House of my earlier Opinion. This entire
Representatives caused by the death exercise was a waste of taxpayer
of David Andahl shortly before the 2020 dollars and time, all of which
election. could have been avoided had the
Governor come across the hall to
The Governor challenged the right of receive legal advice from the person
the District 8 Republican Committee to who was elected by the citizens of
appoint someone to fill the vacancy, as North Dakota to provide legal advice
outlined in Attorney General Opinion to state officials,” said Attorney
2020-L-09. General Wayne Stenehjem. ♦
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The North Dakota Supreme Court, in a Mickelson et al v. ND Department
unanimous ruling, denied the petition, of Health
concluding the Governor did not have
authority to fill the vacancy because the In 2017, the legislature
law already provided a method for filling enacted legislation
the vacancy. to expand cottage
food sales. "Cottage
foods" generally are
Spoofcard, LLC homemade baked and
canned foods.
In 2019, the North Dakota Legislature
unanimously passed a law banning The Department of
"spoofing" (the use of technology to hide Health then adopted
the telephone number being used and administrative rules to restrict the types
instead display an alternate number) of homemade foods that could be sold.
within North Dakota. Those rules took effect in January 2020.
In March 2020, a group of cottage food
Spoofcard, LLC, a New Jersey company producers sued the state in district court,
that sells caller ID spoofing services, seeking to overturn the administrative
sued, arguing that the law attempted to rules.
regulate interstate commerce and was
therefore unconstitutional. In December, 2020, the District
Court ruled against the Department,
concluding it had exceeded its authority
when it adopted the restrictive rules and
the rules were contrary to the law. The
court declared the rules invalid.
Election Lawsuits
Two federal voter identification lawsuits
were resolved this biennium. In Spirit
Lake v. Jaeger and Brakebill v. Jaeger,
the plaintiffs brought suit against the
The US District Court granted a partial Secretary of State alleging North
summary judgment on November 9, Dakota's voter ID laws and the Secretary
2019, ruling the law “has the practical of State's enforcement of the laws
effect of regulating interstate commerce violated the constitutional rights of
because it is impossible for Plaintiffs to Native American voters.
determine whether a call recipient is
physically within North Dakota.” Both cases were settled in April 2020.
As part of the settlement, the Plaintiffs
waived their right to recovery of
• The state entered into an
attorneys' fees, with the exception of a
agreement settling all claims on
portion of the fees in Brakebill v. Jaeger,
December 2, 2020.
which was the subject of an appeal to
the Eighth Circuit Court of Appeals.
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On July 16, 2021 (after the end of the • On July 30, 2021 (after the end of
biennium), the Eighth Circuit Court the reporting period), the federal
of Appeals affirmed a judgment of district court dismissed the claims
$452,983.76 in attorney fees in favor of against the Attorney General,
the plaintiffs. Shortly after that decision, holding that the Attorney General
the State negotiated a settlement to was merely fulfilling his duties
pay the judgment plus post-judgment under state law by publishing the
interest through June 30, 2021, in Manual and offering opinions on
exchange for the plaintiffs’ agreement North Dakota’s open meetings
not to seek additional fees on appeal or laws.
additional post-judgment interest.
Schmitz v. State Board of Chiropractic
Air Ambulance Lawsuit Examiners
A detailed explanation of this lawsuit In June, 2020, a licensed chiropractor
was provided in the previous biennial sued the North Dakota State Board of
report. The ongoing litigation over the Chiropractic Examiners, alleging that
2017 law regulating the manner in the Board violated the open meetings
which insurance companies pay for law when it met in executive sessions to
air ambulance services concluded in discuss a disciplinary matter, claiming it
March 2021, when the state lost at the went beyond attorney consultation and
Eighth Circuit. attorney work product, and alleging the
Board violated the open records laws
by not providing him with copies of the
OPEN MEETING LAWSUITS recordings of the executive sessions.
The Board moved to dismiss the lawsuit,
which was granted by the District Court.
Dr. Schmitz appealed to the North
Dakota Supreme Court.
On April 20, 2021, the Supreme Court
reversed the District Court and
remanded the case for an in camera
Drake v. Stenehjem review of the executive session
recordings to determine if the executive
In December, 2020, Robert Drake sued session discussions went beyond the
the Attorney General, members of the scope of attorney consultation or
Valley City Commission and the City attorney work product and disclose the
of Valley City, in federal district court, portions of the recordings of discussions
alleging the City was violating the First to only those matters not exempt under
Amendment by limiting his ability to the law.
speak at City Commission meetings,
and alleging that the Attorney General’s
Open Meetings Manual and legal • The case is pending. ◙
opinions on open meetings laws also
violated his First Amendment rights.
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ADMINISTRATIVE ACTIONS
The Civil Litigation attorneys represent The Natural Resources attorneys advise
the Bank of North Dakota, the and assist the various state entities
Department of Labor, Department tasked with regulating the exploration
of Human Services, Department of and development of the state’s mineral
Transportation, Job Service North and water resources, protecting the
Dakota, the state's Risk Management environment, and managing state-
Fund, and the Department of owned lands, wildlife and wildlife
Corrections & Rehabilitation. habitats, and public recreation areas.
The Civil Litigation & Natural Resources division recovered over
$15,097,000 for state entities during the biennium.
The attorneys: Oil & Gas Hearings
• Collected $5.7 million for The division presided over almost 2,000
the Bank of North Dakota for oil & gas administrative hearings and
delinquent property and student helped the Industrial Commission’s
loans; Department of Mineral Resources
pursue seven civil administrative cases
for violations of the Commission’s rules,
▪▪ This is less than the $13.3 orders, and regulations, including:
million collected last
biennium because there
was a federal moratorium • $1,027,776 from Samson Oil & Gas
on collection of delinquent residential USA Inc, relating to a Williams
loans beginning in March 2020 and county spill of 240 barrels of
continuing through the remainder of oil. The company completed
the biennium. cleanup and the case settled by
consent agreement in December
2020.
• Collected $1.29 million in unpaid
employer tax and benefit
contributions for Job Service
North Dakota;
• Handled 39 wage claim cases
on behalf of the Department of
Labor, recovering $87,118.75 in
unpaid employee wages from
employers; and
• Represented the Department of Through its enforcement actions the
Transportation in 255 appeals of division has collected $6.95 million in
DUI administrative hearings. penalties.
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Environmental Quality of the spill site, and improve its
leak detection and monitoring
The division assisted the Department of operations.
Environmental Quality with its regulatory
work involving air and water pollution
control, and solid waste and hazardous • Against Family Dollar, Inc., a
waste management. retail store, which provides water
through a private well and is a
public water system, for violating
During the biennium, the division
the safe drinking waters laws
represented the Department in 60
and rules by failing to complete
enforcement actions, collecting more
monthly monitoring, having
than $1.07 million in penalties for
positive e. coli results, and failing
violations, including:
to properly notify the public. The
parties entered into a settlement
• Against Marathon Oil Company, requiring a $30,000 penalty,
for a leak of approximately 32,860 $20,000 of which was suspended
gallons of produced water from provided the store contracts with
a gathering line into a creek a qualified person to perform
and stock pond. The company monthly testing and complies
agreed to pay a penalty of with all safe drinking water laws
$271,000, complete remediation and rules for two years.
ENVIRONMENTAL LITIGATION
Waters of the United States North Dakota v. US Army Corps
of Engineers - Pipeline Protest
The State intervened, along with several
other states, in litigation in the Northern
Costs
District of California to defend the
Navigable Waters Protection rule (the
Trump administration's replacement
of the Obama administration's WOTUS
rule). Several other states have brought
litigation in that district to have the
rule declared void. The lawsuits are
pending.
The Attorney General filed suit against
the United States in July 2018, asserting
that the US Army Corps of Engineers’
negligent actions and inactions during
the protests forced North Dakota to
respond to the emergency situation
created by the protests and resulted in
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more than $38 million in damages to the Washington State Vapor Pressure
State. Standards
The federal District Court in North In July, 2019, the state of North Dakota
Dakota denied the Corps' first effort filed a petition with the US Department
to dismiss the case, holding that the of Transportation seeking to overturn
Corps circumvented mandatory a Washington State law setting vapor
permit requirements when it invited pressure standards on crude oil
and enabled the protesters to occupy unloaded at refineries in its state that
federal lands. Extensive discovery in the were significantly lower than national
case is ongoing. standards.
• A bench trial is set to begin on
May 1st, 2023.
Court Allows Dakota Access Pipeline
to Continue to Operate
May 21, 2021
North Dakota Attorney General North Dakota ships about 10% of its
Wayne Stenehjem welcomed Judge oil by rail to refineries in the state of
Boasberg’s Order today denying Washington.
the effort to shut down the Dakota
Access Pipeline from continuing to The new WA state standard would have
operate pending completion of a made it uneconomical for oil from the
court-ordered Environmental Impact Bakken region in North Dakota and
Statement on a short portion of the Montana to be unloaded at Washington
pipeline where it crosses under the state refineries. The state of Montana
Missouri River. “I applaud the Court’s joined North Dakota’s petition.
determination not to halt the pipeline,
and remain confident that the final The Hazardous Materials Transportation
environmental analysis will again show Act is a federal law authorizing the US
the pipeline is an exceedingly safe DOT to establish a uniform set of national
way to transport oil from North Dakota regulations for the transportation
to refineries, just as it has been doing of hazardous materials. The US DOT
for almost four years,” Stenehjem said. delegated this authority to the federal
Pipeline & Hazardous Materials Safety
“I trust that the updated information Administration (PHMSA).
North Dakota recently provided the
Court, as well as a separate letter In May, 2020, PHMSA issued a decision
from the Three Affiliated Tribes, were in agreement with ND, that Washington
important considerations in the state's restrictions on vapor pressure
Court’s decision, and look forward for transportation of crude oil were
to conferring with the Corps as this preempted by federal law, and further,
matter proceeds,” he added. that the law amounted to "a de facto
ban on Bakken crude." ◙
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Water Supply Rule Stenehjem Applauds Corps of
In August 2019, North Dakota led a group Engineers' Policy Change
of Attorneys General in a letter urging the
Trump administration to instruct the Army December 4, 2020
Corps of Engineers to comply with state
water laws and withdraw its proposed Attorney General Wayne Stenehjem
Water Supply Rule. The proposed rule, was advised that the Army Corps of
published in the final weeks of the Engineers has reversed course on its
Obama administration, would have policy regarding water withdrawals
required prospective users to pay the from the Missouri River, sometimes
Corps for Missouri River water, which referred to as the “surplus water rule.”
would have prohibited North Dakotans Since May 2010, the state’s access
from accessing 75% of the Missouri River to nearly 75% of the Missouri River
for water supply. through ND has been blocked by the
Corps. The Corps’ policy also blocked
all access for the MHA reservation
and the Standing Rock reservation.
“ ”
The notion that the Corps of
Engineers can regulate or charge “This is a huge step in the right
direction to restore full access to
for the use of water that has always the Missouri River to the people of
belonged to the citizens of North North Dakota for beneficial use,” said
Dakota is unlawful and completely Stenehjem. “It remains to be seen
unacceptable. how the Corps will move forward
from here,” he continued.
Attorney General Wayne Stenehjem
August 23, 2019 The Corps refused for over ten years
to process any access easement
applications across the reservoir take-
line without an applicant first signing
a water supply agreement and
agreeing to pay the Corps for water
use. In December 2016 the Corps
then proposed a new nationwide
“water supply rule” that was met with
widespread criticism. Stenehjem’s
office and bi-partisan colleagues in
the Conference of Western Attorneys
General, which Stenehjem chairs,
have worked vigorously with the
Corps to make headway on these
issues.
In January 2020, President Trump
formally withdrew the water supply
rule, and the Corps officially withdrew
its policy.
- 13 -
SUPPORTING CRIMINAL JUSTICE
BUREAU OF CRIMINAL dealer in West Fargo.
INVESTIGATION During the course of the
investigation, agents
The Bureau of Criminal conducted numerous
Investigation Division (BCI) has interviews and obtained
agents located in Bismarck search warrants that
and 13 field offices across the eventually lead to the
state. These agents provided interception and seizure of
assistance to federal, state, and a 5lb package of meth that
local law enforcement agencies on 828 had been shipped to the dealer.
criminal investigations and 706 drug As the shipment originated out of
investigations during the biennium state, the task force coordinated
with the US Drug Enforcement
Administration (DEA) and the
Drug Investigations Department of Justice in an effort
to disrupt and dismantle the
Agents assigned to the ten narcotics entire drug trafficking operation,
task forces work to identify, target, which appears to get its supplies
disrupt, and dismantle Drug Trafficking from Mexico.
Organizations (DTOs) producing
and selling illegal drugs within our
local communities. These DTOs The investigation, which was still
are responsible for the epidemic ongoing as of the end of the
of prescription drugs, fentanyl, and biennium, has been expanded
methamphetamine leading to into California, Virginia,
continued overdoses today. Oklahoma, Illinois and Minnesota.
The BCI targets the supply chains • As of the end of the reporting
of these organizations using digital period, the joint state-federal
technology to isolate and eliminate the investigation has resulted in the
operational and financial avenues being seizure of 44lbs of meth and
used to bring narcotics to North Dakota, 12 kilos of cocaine in various
including: states, $221,000 in currency, and
13 people are under federal
indictment, 8 of whom are
• Narcotics Task Force Agents
received information about a from North Dakota.
large scale methamphetamine
- 14 -
K-9 OFFICERS JIB AND JAB • S/A Jib located a computer in
the storage area of a residence
of an individual suspected to be
involved in child pornography.
The computer contained child
pornography and stored chats
indicating the suspect was
allegedly producing videos of
child pornography and sexually
abusing a minor family member.
In July, 2020, James Van Raden
was charged in federal district
court with multiple offenses
In December, 2019, through funding including patronizing a minor
received from Operation Underground for commercial sexual activity,
Railroad and the federal Department luring minors by computer, and
of Homeland Security, the BCI acquired promoting sexual performance
Hex, a yellow Labrador trained in by a minor.
Electronic Detection. Unfortunately, only
a few weeks later, Hex unexpectedly
died from a heart condition. The case is pending.
Subsequently the BCI acquired not one, • While assisting the Williams
but two, K-9s with specialized training in County Sheriff’s Department
detection of electronic devices such as on a search warrant, S/A Jab
hard drives, cell phones, and sim cards. alerted at a large desk organizer
Jib is a black lab and Jab is a yellow lab. that was full of pens, pencils,
and other office supplies. After
S/A Jab alerted, an investigator
“ ”
went through the desk organizer
“They have proven to be more
but could not locate any items
useful than we even had thought." of interest. S/A Jab still alerted
Attorney General Wayne on the desk organizer, so the
Stenehjem, discussing two of the investigator dumped everything
out and found two micro SD
newest agents of North Dakota's memory cards among the items.
Bureau of Criminal Investigation --
K9s Jib and Jab.
In March, 2021, 34 year old
Interview with Jack Dura, Bismarck Tribune Morgan Tanner was charged with
possession of certain materials
prohibited and promoting an
obscene performance by a
Jib's name was chosen by the breeder minor. In May, 2021, an additional
but K9 handler BCI Agent Halseth was charge of gross sexual imposition
able to pick the name, and chose Jab was added.
because "Jib and Jab go together well."
The criminal cases are pending.
Jib and Jab have already assisted in
more than 80 cases, including:
- 15 -
Internet Crimes Against Children result, Champion was charged
(ICAC) with a second luring a minor by
electronic means, possession
The BCI has six specially trained of child pornography, and
computer forensic agents located promoting sexual performance
in Minot, Fargo, and Bismarck. These by a minor. In March 2021,
agents provide forensic analysis to state Champion pled guilty to all
and federal law enforcement agencies charges and was sentenced
on a variety of criminal investigations, to five years in prison. Upon his
from homicides and financial crimes to release, Champion will have to
child sexual exploitation and internet register as a sex offender.
child pornography.
The ICAC agents investigated 810 cases Sex Offender Registration
and forensically examined 1,510 digital
media devices. Of those devices, 1,184 Sex offenders must register in North
were cellular phones. The total amount Dakota if they have pled guilty to, or
of electronically stored information been convicted of, certain criminal
examined was over 291 terabytes. offenses in North Dakota or an offense
in another court which is equivalent to a
North Dakota registerable offense.
• As of June 30, 2021, there were
1,585 registered sex offenders.
Only 33 offenders were
delinquent, which equates to a
compliance rate of about 98%. ■
Use of Force Investigations
During the biennium, the state’s
ICAC Task Force assisted with 1,018 The BCI assists local law enforcement
child exploitation and sexual abuse agencies with independent
investigations, including: investigations of an officer’s use of force.
Once the BCI’s investigation is complete,
• In February 2020, agents it is referred to the county state’s
investigated a report that attorney who determines whether the
a 21-year-old was sending officer’s actions were justified.
inappropriate texts and
pictures to his 12-year-old step- The BCI conducted 6 use of force
sister. Khristopher Champion investigations, including the death
was charged with promoting of Grand Forks Police Officer Cody
obscenity to minors and luring Holte who was shot and killed in May
a minor by electronic means. 2020, while trying to serve eviction
During further investigations, it papers, and the August 2020 incident
was found that Champion was where Grafton Police Officer Lucas
also in contact with a 14-year- Campoverde was shot in an exchange
old female from Missouri. As a of gunfire by an individual who was
wanted on a federal warrant.
- 16 -
Criminal History Record Checks CLERGY SEXUAL ABUSE
INVESTIGATION
State agencies and professional
licensing boards require, or may In January, 2021, the BCI concluded
request, an applicant to complete a its 18-month long investigation of
criminal history record check. The BCI child sexual abuse by members of
also conducts a record check on all the North Dakota Catholic Dioceses
concealed weapon license applicants. going back several decades.
The agents reviewed all records
associated with complaints of
• BCI conducted 108,219 state
substantiated child sexual abuse
and federal record checks
against individuals previously
for applicants for professional
identified by the Catholic Dioceses,
licensing (a 22.7% increase over
interviewed several victims, and
last biennium), an additional
pursued new leads.
17,966 record checks in response
to requests from the public
Of the 53 individuals who had not
landlords, private employers,
previously been prosecuted, all
etc), and 11,414 for concealed
but two had died by the time the
weapon license applicants.
investigation commenced, one of
whom died while the investigation
was ongoing.
Concealed Weapon Licenses
Investigators identified one new
individual as a likely perpetrator of
child sexual abuse.
Prosecutors with the Criminal &
Regulatory division reviewed the
investigative reports and concluded
The 67th Legislature reduced the that while probable cause existed
"lookback" period for alcohol-related that could have led to criminal
offenses from 10 years to three years, charges against the two surviving
making many more individuals clergy, the acts occurred so long ago
eligible for a Class 1 license which has that the statute of limitations had run.
reciprocity with MN and more than 30
other states. It is anticipated that we
“ ”
will see an increase in the number of I regret it will not be possible to
applications for a Class 1 license.
have these men face their victims
at a trial and face the potential
• There are 41,571 active licenses,
consequences, but I hope it brings
of which 13,747 (33%) are Class 1
licenses. Last biennium, only 24% a measure of comfort to the victims
of active licenses were Class 1. that these crimes were eventually
investigated.
Attorney General Wayne Stenehjem
January 4, 2021
- 17 -
CRIMINAL PROSECUTIONS LaBoyd was arrested and
charged - as an adult. On
The Criminal & Regulatory Division October 15, 2020, he pled
attorneys provide assistance to the guilty to a reduced charge of
county state’s attorneys in prosecuting manslaughter and aggravated
major crimes or on cases where a assault. Laboyd was sentenced to
conflict of interest exists, including: ten years in prison. The Criminal
& Regulatory division prosecuted
• The division assumed prosecution this case.
from Divide County of Derek
Fagerbakke, who was charged The division has attorneys assigned to
with A-Felony Child Abuse after the state-federal High Intensity Drug
his three-month-old son was Trafficking Area (HIDTA) program, to
airlifted to Sanford Health in prosecute drug trafficking offenses in
Fargo with an anoxic bran injury state or federal courts, including
and severe retinal hemorrhaging.
Fagerbakke admitted to shaking • In February 2020, Andre Snead,
the infant but not being aware Spence Courville, and Lakendrick
of the risk. The injury occurred on Dixon were indicted on federal
July 26, 2020. The victim survived heroin trafficking charges. Snead
but his neurologist testified at trial was the source for numerous
that the baby’s brain scans were high level heroin dealers in the
the worst he had seen on an Bismarck and Minot areas, and
individual who has survived. maintain residences in both cities
and also in Las Vegas. Courville
The case went to trial in June and Dixon distributed for Snead.
2021. The jury found Fagerbakke Courville committed suicide
guilty and he was sentenced to when taken into federal custody.
10 years, with five years to serve In July, 2020, Dixon pleaded guilty
at the ND DOCR. He did not and was sentenced to 72 months.
appeal his conviction. Trial was set for Snead but in May
2021, he changed his plea to
guilty.
• On November 10, 2019, Ian
Laboyd (17) shot and killed
Matthew York (19) and shot and
wounded Parker Haider (19),
during what was supposed to
be a drug deal involving LSD.
Laboyd fled the scene to the
alleyway behind a grocery store
in Williston, and dumped the Habeas Cases
Ruger 22 pistol in a dumpster. He
During the biennium, the division
then fled to a female’s apartment
defended the state against 13 federal
and admitted he shot some
habeas cases at the US District Court, 10
people. The Ruger 22 pistol had
cases at the 8th Circuit Court of Appeals
been reported stolen by Laboyd’s
and one case that was declined to be
brother-in-law.
heard at the US Supreme Court.
- 18 -
Administrative Hearings two instances, the offense was found not
to rise to the level of a violation of POST
The Criminal & Regulatory division Board rules, but in the other 24 cases,
provides general counsel to the Peace the officer received some form of license
Officer Standards & Training (POST) sanction, from probation to revocation,
Board, which licenses and regulates law including:
enforcement officers.
• The license revocation of former
During the biennium, the POST Board
Mandan officer Scott Warzecha,
conducted 26 administrative hearings
after he pleaded guilty to several
relating to licensure of officers for reasons
felony offenses for recording a
ranging from lying to law enforcement
juvenile female while she was
during the job application process to use
entering and exiting the shower.
of a minor in a sexual performance. In
MEDICAID FRAUD CONTROL UNIT
The Medicaid Fraud Control Unit (MFCU)was established as a division of this office by
the 66th Legislature. The division initiated its first investigation in November 2019.
Although the MFCU has been operational for only 20 months, it has already recovered $83,867.
Criminal Cases
Through the end of the biennium,
the MFCU opened 50 cases, and has The MFCU filed five criminal cases during
24 active cases for billing fraud by the biennium, including:
Medicaid service providers, abuse
and neglect of patients and residents • In April, 2020, in Pembina County
of health care facilities, and opioid District Court against a licensed
diversion, including: practical nurse (LPN) who was
charged with two counts of
• Investigating a psychologist who reckless endangerment and
appears to be up-coding, billing 10 counts of theft, for allegedly
for Saturdays and holidays, and stealing pain medications
failing to document the time from basic care residents
associated with providing some and replacing opioid pain
other services. medications in the residents’
bubble packs with unprescribed
The total Medicaid liability is over the counter or prescription
approximately $88,000. medications.
Jury trial was been delayed by
Covid-19 restrictions and is now
rescheduled to January 2022.
- 19 -
• Criminal charges were filed in Covid-19 Complaints
Barnes County against a certified
nurse aide and an LPN for the The MFCU received three complaints
alleged abuse of a resident of a involving the improper use of Covid-19
long-term care facility. The two stimulus checks by long term care
cases are pending. (LTC) facilities. Once the Unit explained
the law applicable to residents
receiving stimulus money, the facility
administrators returned the funds to
the residents, resolving the complaints
without the need for formal action. ◘
STATE FIRE MARSHAL
The State Fire Marshal assists local agencies with the investigation
of suspected arson. In addition to the State Fire Marshal, the Chief
Deputy Fire Marshal and one Deputy are stationed in Bismarck.
The remaining four Deputy Fire Marshals are located in field
offices across the state.
Origin & Cause Investigations Deputy fire
marshals
During the biennium, Deputy State Fire worked with local law
Marshals conducted 221 fire origin and enforcement and the state's
cause investigations. Deputies devoted Insurance Fraud division to
7,338 hours to these investigations. identify other evidence of
insurance fraud and the fire
• As of the end of the reporting being arson.
period, 39 fire investigations were
pending. In October 2020, Edward
Gonzales of Nevada pleaded
Of the 182 fire origin and cause guilty to two counts of Conspiracy
investigations that were closed during to commit/endangering by fire
the biennium, 10% were determined to or explosion, and received a
be intentionally set, including deferred imposition of sentence
in return for cooperating with the
• An August 2020 fire investigation investigation of a co-conspirator.
of a commercial bar and
restaurant in McKenzie County.
During the investigation, gas Fire Investigation Equipment
cans were recovered strewn
During the biennium, the State Fire
throughout the building, security
Marshal's Office invested in specialized
cameras had been dismantled,
fire investigation equipment.
the property was for sale and the
insurance coverage was higher
than the listed sale price.
- 20 -
Portable X-Ray Imager. where they may accumulate in a fire
scene.
The X-Ray Imager is used to detect
electrical or non-electrical activity in
items that were consumed by a fire,
enabling fire investigators to further
analyze and evaluate the possibility of
electrical involvement as a cause of the
fire, without damaging the evidence.
This is what an electrical appliance often
looks like after a fire ... a blackened, Deputy Fire Marshal Jess
Sinerius, using the PID to
charred, object. monitor for the presence
of ignitable liquid vapors
Fire Incident Reports
The State Fire Marshal serves as the
state's program manager for the
National Fire Incident Reporting System
(NFIRS), monitoring reports submitted by
But this is what the fire investigators see local fire departments to compile and
with the X-ray Imager: analyze statewide fire incident statistics.
• 260 fire departments in North
Dakota (71%) currently submit
fire incident reports to NFIRS.
This is an increase of 25 fire
departments from the previous
biennium, and is a direct result
of the efforts of the State Fire
Marshal's administrative section to
The Imager is portable, so Deputies can increase the rate of fire reporting
take it on site, even in rural areas. in the state.
• The departments reported
Photo Ionization Detectors 6,255 fires during the biennium,
Fire investigators were also equipped resulting in twelve deaths and
with Photo Ionization Detectors almost $86.4 million in losses.
(PIDs), which detect volatile organic
compounds that are often found
in common ignitable liquids and
accelerants.
The PIDs enable deputy fire marshals to
collect fire debris evidence, learn about
how ignitable liquids were used and
- 21 -
CRIME LABORATORY
The Crime Laboratory Division is an
internationally accredited forensic laboratory
providing forensic laboratory services
to North Dakota’s state and local law
enforcement agencies, medical examiners,
States Attorneys, and state agencies in the
investigation of criminal matters.
Crime Laboratory's Forensic Scientists provide technical assistance and training,
evaluate and analyze evidence, interpret results, and provide expert testimony related
to the analyses of physical evidence recovered from crime scenes and submitted for
examination.
• The Laboratory processed 10,716 Toxicology Samples
criminal cases this biennium.
The Toxicology Unit - Biological Section
processed 638 alcohol samples (4%
Drug Samples increase) and 819 samples (14%
increase) for the presence of drugs
The Forensic Chemistry Unit received obtained as a result of suspected
7,257 cases (a 19% decrease) involving impaired driving-related offenses.
11,303 items (a 44% decrease), and
completed 3,549 cases(a 47% decrease). • The section also analyzed 56
drug-facilitated sexual assault
The decreases from the last biennium cases.
are due to the Covid-19 Pandemic and
the loss of laboratory personnel. In addition, 952 coroner cases and 218
medical examiner cases were processed
• The Forensic Chemistry Unit also for drug and alcohol analysis.
received 117 cases for fire debris
analysis, completing 103 cases, • When the State Medical Examiner
involving 308 items. retired, during the interim period
before the Health Department
hired his replacement, those
cases were directed to the
county coroners, which resulted in
a decrease in "medical examiner"
requests to the crime lab.
The Toxicology Unit – Breath Alcohol
Section provided breath alcohol
instrument training to 3,133 law
enforcement officers (5% increase).
- 22 -
DNA Samples • A DNA profile developed from
a biological sample from the
The DNA unit received 2,172 victim's tanktop in a 2005 North
cases, an increase of 29% Dakota sexual assault case hit to
over last biennium. a DNA profile from a 2020 sexual
assault case from Iowa.
4,912 offender and
arrestee DNA profiles were
• A DNA profile from a cigarette
uploaded into the FBI’s National
butt left at the scene where a
DNA Database, the Combined DNA
fence was cut in an alley to gain
Index System (CODIS), resulting in 334
entry to steal a 4-wheeler in a
matches and possible investigative
2020 Watford City, ND, burglary
leads, including:
hit to a 1991 Utah Sexual Assault.
INFORMATION TECHNOLOGY
The Information Technology and 2020, with the exception of the planned
Criminal Justice & Information Sharing notifications for the Pardon Board.
(IT/CJIS) Division provides technology The Department of Corrections does
support services for the Office of not track Pardon Board notifications
Attorney General staff located in electronically, so the SAVIN system has
multiple locations across the state. no mechanism to receive the data.
In addition, the division supports • All updates were completed on
communications with other state and time and under
local criminal justice agencies through budget.
the Criminal Justice Information Sharing
(CJIS) portal and the state radio teletype
system, 24 hours a day, 7 days a week. Automated Fingerprint
Identification Systems
• The division responded to 12,908 (AFIS )Update
internal and external service With the AFIS system
requests, a 28% increase from the nearing capacity, IT-CJIS has been
previous biennium. working with the BCI division in
partnership with the State of Minnesota,
on an updated joint system that will
Statewide Automated Victim have a database crossing state lines,
Information & Notification benefitting criminal justice efforts in
both states. Minnesota is bearing most
The North Dakota Statewide Automated
of the cost of the new system, which is
Victim Information and Notification
anticipated to go live in October, 2022.
(ND SAVIN) Program is managed by
the IT-CJIS Division. Expansion of the
program to add components required • The current AFIS database now
under Marsy's Law has been ongoing includes more than 3.9 million
for the past two bienniums. The last palm prints and over 4.6 million
phase of updates was completed in fingerprint sets.
- 23 -
PROTECTING CONSUMERS
The Consumer Protection and Antitrust Division performs both legal and investigative
duties as it enforces the consumer fraud and Do Not Call laws, prosecutes consumer
fraud cases, and administers the state’s anti-trust laws.
“Anti-trust” Laws CONSUMER COMPLAINTS
The anti-trust laws protect consumers by The Consumer Protection Division
restricting certain business practices that opened 2003 consumer complaints and
could result in a monopoly or other non- closed 2012.
competitive practice.
• 683 complaints were resolved
through mediation or legal
Multi-state Lawsuits against Google action, recovering $453,067.19
In December 2020, North Dakota joined for consumers. Another eight
a national bipartisan coalition of states were referred to other agencies;
in two antitrust lawsuits against Google,
both filed in federal district courts. • An additional 334 complaints
were from victims of imposter
The first lawsuit alleges that Google's scams, who received individual
monopolization of online display assistance from division staff to
advertising includes an anticompetitive help prevent further losses; and
agreement with Facebook, suppressing
competition and harming consumers. • The remaining complaints were
closed because they were
The second lawsuit addresses Google's unfounded, unresolved, the office
control of search engines, alleging that had no jurisdiction, or no action
by paying phone manufacturers to was required.
have Google products such as Chrome
and Google Search preinstalled in
such a way that consumers cannot Enforcement Actions
uninstall them, it is effectively stifling
competition and the development of The division filed 140 civil actions against
next generation search platforms. individuals and businesses for violating
consumer fraud laws, resulting in
The lawsuits are pending. ◙ $1.5 million refunded to consumers
and $7.5 million in costs and penalties
awarded to the state. ■
- 24 -
Do Not Call
Attorneys General Secure $600
The division initiated enforcement actions Million from Equifax in Settlement
against 14 entities for violations of the of Largest Data Breach in History
“do not call” law, obtaining $20,000 in
civil penalties. Seven of these actions July 22, 2019
included violations through the use of
prerecorded messages. BISMARCK, ND - Attorney General
Wayne Stenehjem today announced
• Telemarketing complaints were that a national coalition of Attorneys
one of the top five complaints filed General has reached a settlement
with the division. with Equifax as the result of an
investigation into a massive 2017 data
breach. The settlement includes a
Combating Illegal Robocalls Consumer Restitution Fund of up
to $425 million and a $175 million
In August 2019, a nationwide coalition payment to the states. It is the largest
of Attorneys General announced data breach enforcement action in
an agreement with twelve national history.
telephone companies, under which the
phone companies will take immediate “This enforcement action sends a
steps to help protect customers from strong message to Equifax and other
illegal robocalls. credit reporting agencies that when
you are in the business of collecting
“ ”
and storing our personal and
For too long, phone customers confidential information, you must
have been harassed by a barrage of properly safeguard that information,
illegal robocalls, seemingly without and if you fail to do so, we will hold
any recourse. With the help of the you accountable,” said Stenehjem.
phone companies, unscrupulous
On September 7, 2017, Equifax, one
scam artists will not be able to hide of the largest consumer reporting
behind a curtain of technology any agencies in the world, announced a
longer. data breach affecting more than 147
million individuals — about half the
Attorney General Wayne Stenehjem, adult population of the United States.
August 22, 2019
Equifax is one of the three major
credit reporting agencies which
The participating phone companies collect personal and financial
agreed to implement call-blocking information of millions of Americans
technology at no cost to customers, and then profit from re-selling that
monitor their networks for robocall traffic, information in the form of credit
and utilize technology to ensure that reports. These credit reports are used
calls to customers are coming from a by prospective employers, landlords,
legitimate source. ◘ credit card companies, and lenders,
to decide whether an individual
poses a credit risk. ◘
- 25 -
CONSUMER FRAUD INVESTIGATIONS
Unlicensed Contractors conducting business in ND until he
complied with the investigation, and
The division continued its contractor further ordered him to pay $2,531.16 in
compliance efforts, taking action fees and costs.
against 28 contractors.
• The division issued four cease &
desist orders against unlicensed
contractors and pursued legal
action against another nine,
obtaining judgments providing
$325,136 in consumer restitution
ordered by the court.
• The division resolved another
13 cases through Assurances of Despite the 2019 ban, DeRosier
Voluntary Compliance. continued to operate as an unlicensed
contractor. After receiving information
The vast majority of these cases involved about his activities, the division took
unlicensed contractors who took further legal action against him.
advance payments and then either did
not do any of the work for which they In June, 2021, the District Court issued
had already been paid, or did not finish judgment against DeRosier and his
the job, such as: companies: GPHQ (dba Garden and
Patio Headquarters), Team Lawn (dba
Team Lawn and Landscaping) and
Vaughn Construction.
Nicholas DeRosier, d/b/a Team Lawn
Inc. and Vaughn Construction Inc.
The Court found that DeRosier
In June 2019, the division began an committed consumer fraud by operating
investigation into Nicholas J. DeRosier, as a contractor without a license
of East Grand Forks, MN, and his and taking advance payments from
businesses, Team Lawn, Inc. and Vaughn consumers, banned him from operating
Construction, Inc., after receiving as a contractor, ordered him to pay civil
multiple complaints from consumers in penalties and costs totaling $8,071.00,
the Grand Forks area that they had paid and further ordered all of DeRosier’s
him for contracting services which he businesses to be involuntarily dissolved
then failed to start or complete. and the trade names canceled.
After DeRosier refused to cooperate
with investigators, the Attorney General
initiated legal action in Grand Forks
County District Court to compel his
cooperation. In October 2019, the
District Court ordered DeRosier to stop
- 26 -
Cease & Desist Orders
Bogus Work at Home Online Job
The division issued an additional five Offer Uses Bismarck Address
cease and desist orders for other
violations of the state’s consumer fraud May 21, 2020
laws, banning the businesses and
business owners from doing business in Attorney General Wayne
the state, including: Stenehjem warns that
scam artists are taking advantage
• Sean Patrick Gorman, Bartley of the current unemployment
Gorman, Jr., Robert Gorman, crisis created by the Covid-19
Patrick Michael Gorman, Joseph pandemic to create bogus websites
Jude Gorman, John Gorman, offering phony “work from home”
Ann Gorman, John Costello, opportunities.
John Lovell, William Riley and
Peter TooGood, using the One recently reported scam website
business name Gorman General uses a street address in Bismarck, ND.
Contracting, were part of a larger The fake business, Nimcare Insurance
out-of-state crime ring, known as (nimcareinsurance.com) claims to be
“Travelers” or “Irish Travelers.” In located in downtown Bismarck. There
North Dakota, they concentrated is no such company in Bismarck – or
on rural areas within oil- anywhere else in North Dakota. The
producing counties. business is a sham.
In the work from home scam, the
unsuspecting victim clicks on a
link in a spam email or online ad,
completes the “application” and is
quickly offered a job. The job titles
vary, but often include “quality
control” or “inventory inspection”
duties.
These individuals engaged in
a pattern of criminal behavior,
The “fake business website” scam
such as showing up at an
has been around for many years.
elderly individual’s rural home
The scammers add a fake street
unannounced, performing
address or use the actual address of
work without permission, and
an unsuspecting business to make it
then using intimidation to
appear there is a physical location
force the victim to pay for the
associated with the website.
shoddy work; starting a job and
then demanding payment of
“Never assume a business website
thousands more to finish the work.
and business address you are
In one instance, after demanding
unfamiliar with are legitimate or
the victim pay an extra $32,000,
you could become the next scam
they then threatened to take
victim and lose your money,” said
the elderly woman’s vehicle and
Stenehjem. ◘
camper instead, forcing her to
flee through a window for help.
- 27 -
Victim
IMPOSTER SCAMS
The Consumer Protection division issued
numerous news releases, alerts, and
consumer advisories warning about
various imposter scams, including the In January 2021, a bank called the
Fake IRS and Government Agency Consumer Protection division to discuss
calls, bogus "Inheritance" scams, the concerns about one of its customers.
Grandparent/Family Emergency scam, The 65-year old male customer had
the phony Sweepstakes/Foreign Lottery withdrawn $140,000 from his account
Win scam, and the Romance/Online and was coming back later in that
Dating scam. day to request a loan. The bank was
concerned that the customer might be
involved in a Romance Scam.
These imposter scams have been
particularly pervasive for many years
and frequently claim new victims despite
all the public awareness efforts and
countless warnings.
North Dakota victims reported losses
of more than $4.7 million to Imposter
Scams alone.
When the customer returned, the bank
Unfortunately, scam victims are often too
called the Consumer Protection division.
embarrassed to report that they have
The customer explained that he had
fallen for a scam, even when they have
met a female on a dating website
lost a significant amount of money.
and had been communicating with
her electronically for several months
Of the 334 imposter scam victims who
although he had never met her in real
received individual guidance from
life because she was working in a foreign
division staff,
country. The man explained that the
female had experienced several legal
• 55 were victims of the "Computer and medical problems, which is what he
technician" scam, losing $547,233. was sending money to cover.
• 44 people fell for the phony He was having his retirement funds
sweepstakes and lottery scams, deposited into the bank account and
losing more than $597,598. then sending it all on. He estimated
he had withdrawn $500,000 from his
retirement account, but now had nothing
• 27 people responded to a fake
left. When he told the female he had no
government agency call, losing
money left, she then encouraged him to
$72,000.
get a loan.
• 36 people fell victim to online Unfortunately, he is just one of many
romance scams, losing more victims who lost all their money to an
than $1.8 million. imposter scam.
- 28 -
REGULATORY ENFORCEMENT
Fire Safety and Prevention • Fire safety inspections are
required as a condition of
licensing for child care facilities,
Fire Safety Plan Reviews bars, and restaurants.
The State Fire Marshal's office works with
contractors to ensure fire protection The deputies inspected 87 day care
systems, buildings, and fuel tanks meet facilities, 146 public schools, 346 state
fire code safety requirements prior to buildings, and 47 bars and licensed
construction. Identifying fire safety issues restaurants.
prior to starting construction helps to
resolve problems during construction or
installation, saving time and money for
owners and installers.
• Deputies conducted 136 fire
safety plan reviews during the
biennium.
Licensing Section
The Licensing Section issues licenses to
bars, restaurants, liquor stores, transient
merchants, gaming sites and operators,
fair boards, and wholesale fireworks
distributors, among others.
DFM Kayln Lucas, Jess Sinerius and
Doug Pierre, reviewing plans for fire
• Over $1.2 million was transferred
safety. to the state’s General Fund in
licensing fees, including $288,277
in retail liquor license fees,
Fire Safety Inspections $309,387 in retail beer licenses,
and $491,950 in gaming license
Deputies inspect public schools, child
fees.
care facilities, state buildings, licensed
liquor establishments, and fuel tank
storage sites for compliance with state
building and fire safety codes.
- 29 -
GAMING
The Gaming division regulates, enforces and administers charitable gaming in North
Dakota, performs audits and investigations of gaming organizations; reviews gaming
tax returns, administrative complaints, and provides training for charitable gaming
organizations.
Veterans, charitable, educational, • The division collected $100,150
religious, fraternal, civic and service, in fines and referred several
public safety, or public-spirited incidents of suspected criminal
organizations in North Dakota may activity to local law enforcement,
apply for a state gaming license to raise including cases involving theft
money for charitable purposes. Only of funds by gaming employees,
licensed organizations may conduct incidents of counterfeit money
“games of chance,” such as bingo, pull and one case involving a
tabs, twenty-one, and poker. cheating device.
There are more than 325 licensed
organizations operating 995 gaming sites Electronic Pull Tab Devices
across the state.
Electronic pull tab devices have
become the top grossing game type
• During the 2019-2021 biennium, bringing in over $2.7 billion in gross
licensed gaming organizations proceeds and paying out over 2.4 billion
grossed an estimated $3.2 in prizes during the biennium.
billion - a 280% increase
from last biennium - raising
an estimated $156 million for • There were 3,684 e-tab devices
charitable uses and generating being conducted by 320
$38.7 million in gaming taxes for organizations in 693 sites in 263
the state’s General Fund. cities across the state.
Gaming Compliance
The Gaming division conducted five
E-tab group training sessions with 18
individuals representing 11 gaming
organizations and two distributors,
along with one-on-one training for 120
individuals representing 122 gaming
organizations and three distributors.
The division also conducted 11
post-audit training sessions with 39
individuals representing 11 organizations.
The division conducted seven
comprehensive audits and 34 in-office
audits, resulting in 66 administrative
complaints.
- 30 -
The top five counties were: Cass County agreement admitting that it had
with 480 devices, Ward County with 277, engaged in acts that violated state
Burleigh County with 261, Grand Forks gaming regulations, and paid a $25,000
County with 213, and Morton County fine with an additional $25,000 fine
with 199 devices. suspended for two years. Attorney
General Stenehjem reinstated the
The top five cities were: Fargo with 252, license.
Bismarck with 237, Minot with 186, Grand
Forks with 169, and West Fargo with 139.
Gaming Computer System
The Gaming Division completed the
first stage of an update to its electronic
gaming tax return system. The system,
once completed, will streamline filing
and processing gaming tax returns and
• Although gaming operations distributor invoices, reducing the amount
were shut down for about six of paper record-keeping by Gaming
weeks from March 20, 2020, division staff by 85%.
through April 30, 2020, due to
Covid-19, e-tab activity grew The system enables licensed gaming
by 40% between June 2019 and organizations to file their gaming tax
June 2020. returns and pay the gaming tax online.
Licensed gaming organization were able
Powerhouse Gaming, Inc. to begin filing online with the March 2021
The Gaming division initiated an returns.
investigation in May, 2020, after receiving
credible information that Powerhouse • By June 2021, 201 of the 322
Gaming, Inc., a licensed gaming gaming organizations had
equipment distributor, had installed enrolled in the online system and
pirated software in its e-tab devices. filed returns. ♦
Officials from the gaming division
inspected several Powerhouse devices
and confirmed that the company had
improperly installed a software hack that
violates copyright laws.
As a result, Attorney General Stenehjem
suspended Powerhouse Gaming's
license and ordered the immediate
shutdown of all its e-tab devices until
Powerhouse provided satisfactory proof
it had purchased and deployed the
required software licenses on all of its
e-tab devices.
On October 14, 2020, Powerhouse
Gaming Inc., signed a consent
- 31 -
NORTH DAKOTA LOTTERY
The North Dakota Lottery conducts five multi-state games: Powerball®, Mega
Millions®, Lucky for Life®, Lotto America®, and 2by2®. The mix of games provides
jackpots starting from $22,000 to $20 million.
• $3,000,000 Mega Millions with
Megaplier prize in March 2021 to
a player from Fargo, ND;
• $1,000,000 Powerball prize in April
2020 to a player from New Town,
ND, and another $1,000,000 in
January 2021 to a player from
Walhalla, ND;
The North Dakota Lottery generated • $25,000 a year for life Lucky
total operating revenues of $54.7 million for Life prize in June 2020 to a
and net proceeds of $12.5 million. player from Max, ND, another
in November 2020 to a player
Across the state, 447 gas stations, from Jamestown, ND, and a third
convenience stores, grocery stores, and in March 2021 to a player from
other locations are licensed to sell North Williston, ND;
Dakota lottery tickets.
• Ninety-one $22,000 2by2 jackpots
• These businesses earned sales and five $44,000 2by2 Tuesday
commissions and bonuses of Doubler jackpots.
$2.6 million.
Lottery Promotion Success Stories
Lottery Ticket Sales One of the Lottery's statutory priorities
The breakdown of each $1 Lottery ticket is to promote its games. The lottery
is: Prizes Expense - 51%, Contracted offers limited-time promotions multiple
Services - 10%, Retailer Commissions - times a year to
5%, Advertising/Marketing Expense - 2%, encourage player
Administrative/Operating Expense - 6%, awareness of all of
Compulsive Gambling Prevention and the lottery’s games.
Treatment Fund - 1%, Multi-Jurisdictional These promotions offer
Drug Task Force Grant Fund - 2%, Prize incentives such as
Reserve Pools - 1%, State General Fund - instant win prizes, free
22% tickets and discounts.
Prize Payouts Lucky for Life
The lottery paid out $29 million in INSTANT LUCK – Players who purchased
prizes this biennium, including: a single draw, three play Lucky for Life
- 32 -
ticket ($6) August 2 through August 29, Pick & Click Online Play Service
2020, had a chance to instantly win a
free $2 Lucky for Life ticket, $10 cash, or Players who purchased a 13, 26, 39
$100 cash. or 52 week online play via the North
Dakota Lottery’s Pick & Click online play
Over 12,000 players instantly won a prize, received up to a 10% discount.
including thirty $100 instant winners
($31,202 in total instant prizes). The promotion ran December 1 through
31, 2020, and was available to all eligible
Lucky for Life sales increased an players using the North Dakota Lottery
impressive 119% when compared to the Players Club website and/or official
26-week, weekly sales average prior to mobile app.
the promotion.
• There were 578 eligible purchases
made, saving players $4,720.
2by2 Eligible sales totaled $47,873
2BY2 INSTANT WIN – Players who
purchased a single play, seven draw
2by2 ticket ($7) February 7 through
Lottery Proceeds
March 6, 2021, had a chance to instantly The Lottery transferred $10.4 million to
win another seven draw 2by2 ticket ($7 the state General Fund, $1.6 million to
value) FREE or $500 cash. the Multi-jurisdictional Drug Task Force
Grant Fund (to offset rent, equipment,
Weekly sales steadily increased over and other costs associated with the
the entirety of the four week promotion: undercover operations), and $640,000
Week 1: $155,563; Week 2: $173,631; to the Compulsive Gambling Prevention
Week 3: $178,838 and Week 4: $191,067. and Treatment Fund. ◘◘
• Three of the four weeks (weeks
2, 3 and 4) were record setting
weekly sales numbers in North
Dakota 2by2 history.
• Week 4 now holds the record for
largest weekly sales at $191,067. Since the Lottery began, North Dakota
players have won more than $159 million.
• March 2, 2021 holds the top
spot for highest single day sales:
$34,379.
Total promotion sales were $699,099,
which is a 2by2 Instant Win promotion
record.
- 33 -
BIENNIUM IN REVIEW
PUBLISHED INVESTIGATED
41
Attorney General Opinions
221
Fires to Determine the Cause
CONDUCTED PROCESSED
1,554
Criminal and Drug Investigations
10,716
Crime Laboratory Cases
RECOUPED COMPLETED
$83,867
in fraudulent Medicaid billing
108,219
Criminal History Record checks
OBTAINED RECOVERED
$1.95 m
in consumer refunds
$15.1 m
for state agencies
- 34 -
Office of Attorney General
600 E. Boulevard Avenue
Dept. 125
Bismarck ND 58505
E-Mail: ndag@nd.gov
Website: www.attorneygeneral.nd.gov
Telephone Numbers
Main Office
(701) 328-2210
Consumer Protection Division
(701) 328-3404
Bureau of Criminal Investigation
(701) 328-5500
Gaming Division
(701) 328-4848
Licensing Section
(701) 328-2329
State Fire Marshal
(701) 328-5555
North Dakota Lottery
(701) 328-1574
Winning Numbers Hotline
(701) 328-1111
State Crime Laboratory
(701) 328-6159
Medicaid Fraud Control Unit
(701) 328-5446
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