To start with, it's "strip something of its assets" (too many "of"s in your post).
I can't say that I've said it even once in my life, but it's not an unusual phrase.
In your example, it would have to be something like "the settlers stripped the Indians of their assets" (although that may be putting the whole thing a bit mildly, if you're talking about American history).
Some further examples from the Internet:
Powers to strip human rights abusers of their London assets approved by MPs
It’s both unethical and unhelpful for governments to strip refugees of their assets
Police apply to strip Christchurch crime family of $2.1m in assets