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Friday, September 16, 2005

N.M. Treasurer, Former Treasurer Arrested on Federal Racketeering Charges

By Heather Clark/
Associated Press
      New Mexico's state treasurer and his predecessor were charged Friday with racketeering in schemes in which they allegedly took roughly $700,000 in kickbacks from investment advisers.
    An indictment stemming from a two-year FBI investigation, dubbed "Midas Touch,'' accused Treasurer Robert Vigil and former Treasurer Michael Montoya of receiving the illegal payments.
    The two men allegedly received kickbacks from three financial advisers who were paid commissions for helping invest public funds, according to an affidavit. Montoya allegedly was paid about $632,000 while Vigil received about $54,000.
    According to prosecutors, one investment adviser, Peter Simons, who cooperated with the FBI's case, claimed Montoya told him: "The kickback is the way we do business in New Mexico.''
    Simons said he paid Montoya part of his commissions and personally delivered cash to Montoya three times — in amounts ranging from $4,000 to $10,000, according to an affidavit.
    Kickbacks to Vigil allegedly came in the form of expensive tickets to political fundraisers, the purchase of wood and supplies and donations to charities in which Vigil's wife participates.
    "Public funds should never be used like private ATM machines,'' U.S. Attorney David Iglesias said in detailing the charges at a news conference.
    Both men face 20 years in prison if convicted. The two men were due to appear in federal court later Friday.
    Montoya served as state treasurer from 1995 to 2002. Vigil was elected to a four-year term in 2002. Both are Democrats.
    Pahl Shipley, a spokesman for Gov. Bill Richardson, said: "These are very serious charges. It is premature to comment further until all the facts come to light and the legal process runs its course.''
    But Dave Romero, general counsel in the state Treasurer's Office, said he was confident Vigil would be absolved of the charges.
    "I know him to be a very honest man. Once he gets the opportunity to defend himself, he will be able to quash the indictment and be found innocent,'' Romero said.
    The arrests were part of a two-year public corruption investigation code-named "Midas Touch.'' The New Mexico Tax Fraud Investigations Division helped with the investigation.
    Both men face two counts of racketeering and interference with commerce under the Hobbs Act, according to a release from the U.S. attorney's office. The act makes it a crime for anyone to obstruct commerce by extortion using their official office.
    The FBI and agents from the state Tax Fraud Investigations Division executed search warrants at the Treasurer's Office in Santa Fe on Friday. Employees of the office remained on the job to do necessary work, Romero said.
    Vigil's home in Ribera and Montoya's home in Los Lunas also were searched. The FBI also obtained search warrants in Los Lunas for two storage units and a second property on six acres that had an underground bunker.
    Vigil and Montoya were arrested at their homes without incident by FBI agents, FBI spokesman Bill Elwell said.
    With Vigil in custody, deputy Treasure Elaine Olah was in charge of the office Friday.