Timothy Egan, “Indians Win Major Round in Fight Over Trust Accounts,” New York Times, February 23, 1999.

For nearly a century, American Indians have been asking the Federal Government for a simple accounting of money and land held in trust for them since the days of treaty signing. Yesterday, they got the attention of the highest levels of Government as a Federal judge held in contempt two Cabinet Secretaries who oversee Indian trust accounts.

The judicial order, citing official deceit, was a jolt in a lawsuit over billions of dollars in money and land held in trust for as many as 500,000 Indians. The order is viewed by people on both sides as a fire alarm in a case that has been smoldering since it was filed in 1996. It is set to go to trial in May.

The trust accounts date to the 1880's, when the Government tried to break up the tribal land ownership system and awarded individual allotments of 80 to 160 acres per Indian. These lands were then managed by the Government, usually leased out to gas, oil or timber companies. As with many trusts, the income is due to be passed on to the descendants of the original recipients.

The Indians are trying to force the Government to set up a proper accounting system for the trust funds, and to repay beneficiaries who may have lost up to $10 billion over the last century, they say.

Clinton Administration officials say records of nearly century-old oil, gas or timber leases have disappeared in many cases, making it impossible to keep track of who is owed what. But tribal members say more than time and bureaucratic incompetence are at fault.

Yesterday, Judge Royce C. Lamberth of Federal District Court in Washington forcefully agreed, saying in his contempt order that Government officials had deliberately delayed turning over the documents and then lied about it.

In a scathing denunciation of the Government's handling of the trust fund case, Judge Lamberth found Secretary of Interior Bruce Babbitt, Secretary of Treasury Robert E. Robert Rubin and Kevin Gover, an Assistant Secretary of the Interior, in civil contempt for failing to produce records of the trust funds.

The Government ''engaged in a shocking pattern of deception of the court,'' the judge said. ''I have never seen more egregious misconduct by the Federal Government,'' he added.

The contempt order carries no personal penalties, and is largely an indictment of the departments that oversee Indian trust funds, not necessarily the Secretaries themselves. But Judge Lamberth warned that further delays could lead to criminal contempt citations of both Mr. Rubin and Mr. Babbitt.

Under the order, the Government must pay the plaintiffs legal fees and other expenses resulting from the officials' delay.

Legal historians say it is the first time two Cabinet officers have been held in contempt simultaneously. Next week, two Senate committees will hold a joint hearing on the issue.

''I think this is the beginning of justice for the victims who have had years and years of abuse at the hands of the United States Government,'' said Eloise Cobell, a member of the Blackfeet Nation who is the chief plaintiff in the lawsuit.

She said the standard of money management for Indians by the Government is far different than that of other trusts. ''The Government regulates national banks to the highest standards,'' Ms. Cobell said. ''And yet when it comes to Indian money, look at what they've done.''

The Clinton Administration says it inherited an epic accounting mess, and that it has done more than any administration to correct the problem. The President has requested $150 million for the next fiscal year to set up adequate accounting.

Yesterday, Administration officials were apologetic. ''We deeply regret the mistakes that we made in this case,'' officials from the departments of Interior, Treasury and Justice said in a joint statement. Earlier, they apologized to the court for their inability to produce legal and trust documents.

Mr. Babbitt says the Interior Department has reorganized two-thirds of the account files, putting a management system in place that is closer to that of commercial banks. But he says major problems remain.

For example, the Government estimates that the accounts generate about $300 million a year. But it has no idea precisely how many properties, leases, contracts and investments are in the trusts.

The plaintiffs say many checks are lost or are sitting in files or there are no records of the original contracts and the money that comes from them.

Efforts to track down the funds have been largely unsuccessful for both sides.

The money is vital to some Indians who depend on it for their basic income. In the past, people have lost their land or homes through foreclosure because the trust fund checks never arrived.

''If a national bank had handled a trust fund the way the Department of Interior has handled Indian trust funds, the bank would have been closed and the people running it would be in jail,'' Ms. Cobell said.

Ms. Cobell, who lives on the Blackfeet Reservation in Montana, is one of five people in the lawsuit whose cases are specifically cited. Indians have been trying to find the records of her family trust and four others as a way of showing a specific pattern of neglect by the Government.

The records have been misplaced, lost to time, or -- in the case of document center in Albuquerque, N. M. -- contaminated with rat feces that could contain hantavirus, Government officials say.

''The Government has been ducking their trust fund responsibility for decades,'' said John Echohawk, Director of the Native American Rights Fund, which is backing the lawsuit. ''It goes to show how egregious their management has been that they couldn't even find records for five people and then lied to the court about it.''

Judge Lamberth sided with the tribal members throughout his 76-page order. ''Justice has not been done to these Indian beneficiaries,'' he wrote. ''The court cannot tolerate any more empty promises.''

The Indian trust accounts have been particularly embarrassing to Mr. Babbitt, who came into office vowing to overhaul some of the ways that his department oversees affairs in Indian country.

Government officials say they have had a hard time finding some of the descendants who are beneficiaries of the trusts, an explanation dismissed by Indians who have been fighting for basic accountability.