AG Used Malott’s Signature

To others, they might seem more significant because they involve state government’s chief lawyer, Attorney General Gary King.

Another player: former Educational Retirement Board Chairman Bruce Malott, who is a defendant in civil lawsuits alleging pay-to-play politics in state investments.

Here’s the story:

In late 2003, King created a political committee called King for Congress to finance a campaign for the House. Malott, an Albuquerque accountant, was the committee’s treasurer.

King lost the general election in 2004 to incumbent Republican Steve Pearce, and Malott’s work for the committee ended shortly thereafter, according to both King and Malott.

But King for Congress was kept alive until 2010. That gave it time to pay off a nearly $122,000 bank loan.

Here are the potential problems:

♦ After Malott’s work for the political committee ended, his electronic signature continued to appear on committee finance reports filed over the Internet with the Federal Election Commission.

Malott said he didn’t review the reports and learned only recently that the committee continued to use his electronic signature. People who sign such reports are subject to penalties for false or incomplete information.

♦ King has said he filed the reports that bear Malott’s signatures. Federal election law says “treasurers shall file” the reports.

♦ King for Congress was required to report Malott’s departure as treasurer to the FEC within 10 days, according to federal law. It didn’t do so.

♦ The committee was required by federal law to replace Malott with a new treasurer but didn’t. FEC records show Malott is still listed as treasurer.

Between January 2005, when Malott said he left as treasurer, and April 2010, when the King political committee was finally terminated, a total of 32 reports with Malott’s signature were filed with the FEC, according to commission records.

Also, during that same period, the FEC sent four letters to Malott requesting additional information. They were mailed to a post office box for King in Moriarty.

King was elected attorney general in 2006 and re-elected last year.

In a telephone interview with reporters on June 2, King said his interaction with Malott ended after the 2004 congressional campaign.

“I had to continue filing campaign reports for some period of time after the campaign was over,” he said. “So his name remained on my campaign until the FEC closed it out.”

Here are some excerpts from federal election campaign laws and FEC publications based on those laws and related federal rules:

♦ “Every political committee shall have a treasurer. No contribution or expenditure shall be accepted or made by or on behalf of a political committee during any period in which the office of treasurer is vacant.”

♦ “The committee must report any change in the treasurer’s status within 10 days by filing an amendment to the Statement of Organization” filed with the FEC.

♦ “If the treasurer is unable to exercise his or her duties (for example, is not available to sign a report or upload an electronic filing), only an assistant treasurer who has been officially designated … may assume the treasurer’s duties.”

Phil Sisneros, a spokesman for King, said the attorney general doesn’t believe there were any violations.

Sisneros said King told him that he (King) was authorized as the candidate to file the reports, but Sisneros said he couldn’t provide a legal citation for that authority.

As for why Malott’s signature continued to appear on reports, Sisneros said King probably called up forms with Malott’s signature, filled them out, then hit “send.”

The FEC’s website says a report filed over the Internet requires a password, and that the treasurer’s signature is needed to obtain a password.

The FEC can impose administrative fines for violations of federal election laws.

Alleged conflict

Malott is a defendant in two lawsuits filed in 2008 and 2009 by Frank Foy, former chief investment officer for the Educational Retirement Board.

The Foy lawsuits, which allege pay-to-play schemes at the ERB and the State Investment Council, were brought under the New Mexico Fraud Against Taxpayers Act. Under the act, King had the option of taking over the lawsuits or allowing Foy to proceed on behalf of the state.

The AG chose to let Foy proceed but now wants to take over the allegations of corruption at the State Investment Council. The AG and a private law firm hired by the SIC have partnered on two new lawsuits seeking damages from more than a dozen people.

Foy is opposing King’s attempt to take over part of the Foy lawsuits, and Foy attorney Victor Marshall has alleged King has multiple conflicts of interest, including Malott’s work as treasurer of King for Congress. The attorney general has denied any conflicts.

Because the AG’s new lawsuits deal with the State Investment Council and not with investments by the Educational Retirement Board, Malott isn’t a defendant. However, some of the defendants in the AG lawsuits are accused by Foy of conspiring with Malott on ERB investment deals. Malott has denied any wrongdoing.

No involvement

Malott, in a written statement to the Journal, said he left King for Congress when King said he no longer needed Malott’s assistance in filing the FEC reports. He added:

“After that, I did not work on the King for Congress campaign reports, nor did I review any reports that were filed with the Federal Election Commission.

“Other than a small political contribution, I had no other involvement in any of Mr. King’s subsequent political activities.

“I did not know until recently that the campaign had continued to use my electronic signature on filings with the Federal Election Commission after my January 2005 resignation.”

Malott made a $100 contribution in 2006 to King’s first campaign for attorney general.

King appears to have been the only contributor to King for Congress after the election, and the committee paid off the bank loan in late 2008. The committee was terminated in April 2010 after King essentially agreed to forgive about $80,000 in loans that he had made to the campaign.

UpFront is a daily front-page news and opinion column. Comment directly to Thom Cole at tcole@abqjournal.com or 505-992-6280 in Santa Fe. Go to www.abqjournal.com/letters/new to submit a letter to the editor.

— This article appeared on page A1 of the Albuquerque Journal