In response to Ethics Watch's call for an investigation of spending abuses by Black Hawk city officials, First Judicial District Attorney Scott Storey notified Ethics Watch that the Colorado Bureau of Investigation is looking at how Colorado gaming towns, including Black Hawk, are spending state historical preservation money. This investigation is ongoing and could result in criminal charges.

On June 12, 2008 Ethics Watch requested that DA Storey investigate Black Hawk Mayor David Spellman and City Manager Richard Lessner for embezzlement of public funds and other potential crimes in violation of state law. Mayor Spellman, who is currently under a suspended sentence for felony assault, was named one of Colorado's most corrupt public officials in Ethics Watch's 2008 Ethics Roundup.

In response to media reports regarding questionable spending by city officials in Black Hawk, Ethics Watch submitted a Colorado Open Records Request Act ("CORA") request and written questions on the subject to Black Hawk City Manager Richard Lessner. After inspecting the responsive documents, Ethics Watch corfirmed that Black Hawk city officials spent thousands of dollars in tax dollars in 2007 on a lavish trip to Las Vegas for themselves and their spouses without reimbursing the city for unauthorized expenses. Black Hawk city policy expressly requires city officials to cover expenses for family members and friends with personal funds, not tax dollars. In addition to these Las Vegas trips, Black Hawk paid for official travel to Atlanta, Chicago, Washington, DC, Snowmass Village and other destinations during 2007.

Ethics Watch also investigated the historic preservation grants programs administered by Black Hawk city officials and confirmed that they have awarded each other hundreds of thousands of dollars in historic preservation grants for improvements to their own residential properties.

On June 20, DA Storey responded to Ethics Watch's call for investigation by thanking Ethics Watch for the addititonal information it submitted and notifying Ethics Watch that the Colorado Bureau of Investigation is currently investigating historic preservation spending in Colorado's three gaming towns. DA Storey stated that because of the complexity of the issues involved, the investigation is expected to be lengthy and that "[t]he issues that will be reviewed will be potentially criminal matters."