State Mum on NMFA Cases

The state Securities Division isn’t saying how it plans to proceed with criminal charges against the chief operating officer and the former controller at the New Mexico Finance Authority.

COO John Duff, who has been placed on unpaid leave, and former controller Greg Campbell were arrested Aug. 8.

Campbell faces charges of forging a 2011 audit of the Finance Authority. He and Duff also are accused of misleading bond investors about NMFA finances.

Because Campbell and Duff were arrested on criminal complaints and not as a result of grand jury indictments, they are entitled to preliminary hearings before a judge within 60 days of arrest.

The judge would determine whether there is sufficient evidence against the two to warrant trial.

But the Securities Division could proceed with the cases against Campbell and Duff in another way: present evidence to a Santa Fe County grand jury and seek indictments.

The Securities Division isn’t saying which way it plans to go.

“Since this is an ongoing investigation, we cannot comment,” a spokesman said.

However, the Journal has learned that the Securities Division plans to present evidence to a grand jury after Labor Day.

Neither Duff nor Campbell nor their attorneys could be reached for comment. Both defendants are free pending further proceedings in their cases.

At risk

The Finance Authority wasn’t designated “at risk” by the office of state Auditor Hector Balderas until May 23.

That was five months after NMFA was required to submit its 2011 audit and 11 months after it failed to meet a deadline to have a firm under contract to do the audit.

Governments and agencies are designed “at risk” by the Auditor’s Office when they have failed to submit audits for office review and approval.

It was the NMFA’s appearance on the “at risk” list that led to the discovery that the authority’s 2011 audit had been forged.

Both Balderas’ office and the NMFA announced the discovery of the fake audit June 12.

Balderas has said he is reviewing whether his office should have acted sooner when the NMFA failed to submit an audit contract, then missed the deadline for submitting an audit.

Legal bills

As you might expect, the Finance Authority, which helps finance state and local construction and other capital projects through bond sales and other programs, has sizable legal bills.

The two major contractors for legal services are the Sutin, Thayer & Browne firm in Albuquerque and Virtue, Najjar and Brown in Santa Fe.

Sutin has billed the NMFA more than $570,000 this year; for Virtue, it’s more than $290,000.

The law firm of prominent Republican lawyer Mickey Barnett of Albuquerque is an NMFA-approved subcontractor to the Virtue firm to do legal work for the authority. The Virtue firm is responsible for paying the Barnett firm for any subcontracting work.

Barnett is a former member of the Republican National Committee. He was a fundraiser for Gov. Susana Martinez’s campaign and helped launch the political career of her chief of staff, Keith Gardner.

Another prominent Republican lawyer, GOP national committeeman Pat Rogers, is registered with the Secretary of State’s Office as a lobbyist for the Albuquerque law firm of Stelzner, Winter, Warburton, Flores, Sanchez & Dawes in Albuquerque.

Law firm partner Nann Winter is the new chairwoman of the NMFA.

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