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Saturday, February 07, 2009
Subpoena in GRIP Inquiry Extensive
FOR THE RECORD: This story incorrectly identified the state agency that declined to make public a federal grand jury subpoena seeking records involving CDR Financial Products of Beverly Hills, Calif. Officials for the New Mexico Finance Authority denied the Journal’s request to view any subpoenas it had received.By Jeff Jones And Colleen Heild
Copyright © 2009 Albuquerque Journal
Journal Staff Writers
A grand jury subpoena in the federal "pay-to-play" probe that ended Gov. Bill Richardson's nomination for commerce secretary sought more than six years of correspondence between the governor's top advisers and the financial firm that won nearly $1.5 million in state business.
The subpoena was provided to the Journal by the Governor's Office this week in response to a public records request and provides an official glimpse into the scope of the investigation.
There have been no charges, and there is no indication that anyone has been officially identified as a target.
The subpoena, dated Sept. 22 and partly detailed in a Bloomberg news service report in January, ordered the Governor's Office to produce records and correspondence "between January, 2002, through the present" between top Richardson advisers and officials affiliated with Beverly Hills-based CDR Financial Products.
Specifically, the subpoena sought any correspondence between CDR officials and:
• David Contarino, a Santa Fe businessman who is Richardson's former chief of staff and presidential campaign manager.
• David Harris, a University of New Mexico vice president who previously served as Richardson's deputy chief of staff and executive director of the New Mexico Finance Authority.
• Mike Stratton, a longtime Richardson friend, Colorado businessman and top Richardson political adviser.
• Chris Romer, a Colorado state legislator and banker who urged the New Mexico Finance Authority board in 2004 to consider using a new kind of financing tool called an interest rate swap for some of its investments.
The subpoena also asked for records concerning political contributions to Richardson's gubernatorial and presidential campaigns, along with contributions made to three Richardson-affiliated political groups: Moving America Forward, Si Se Puede Boston 2004! and the Democratic Governors Association.
CDR President David Rubin and his firm contributed $110,000 to the groups in 2003-2004. Other firms involved in GRIP financing gave a total of more than $500,000.
The documents were to be turned over to the FBI by Oct. 7, 2008.
The Journal also requested any records Richardson's office turned over in response to the subpoena, but that request was denied by his records custodian.
She said that making the documents public was prohibited by rules governing grand juries and that public policy considerations justified keeping the information secret.
CDR was hired by the Finance Authority in 2004 to advise the state on $420 million in swaps for the transportation initiative known as GRIP — Governor Richardson's Investment Partnership.
Romer's firm, JP Morgan, was among the banks that won a GRIP swap contract. JP Morgan helped bring CDR into the deal.
In addition to members of Richardson's inner circle, the subpoena served on his office identified CDR officials whose communications were of interest.
They include Rubin; managing director Zevi "Stewart" Wolmark; senior vice presidents Doug Goldberg and Evan Zarefsky; and "any other representatives" of CDR and another entity, Rubin/Chambers Dunhill Insurance Services Inc.
CDR spokesman Allan Ripp said Friday that he didn't know anything about the insurance services entity, or whether it did any business in New Mexico.
In the months since the subpoena was issued, the grand jury has taken testimony from unidentified witnesses. No criminal charges have been filed.
Richardson has declined to answer specific questions concerning the investigation, though he has said that no wrongdoing occurred and that the investigation will bear that out. He said he has ordered his administration to cooperate.
Stratton and Romer have not returned Journal messages seeking comment on the investigation.
The subpoena came well before the November presidential election and Barack Obama's announcement in December that he wanted Richardson to be commerce secretary.
After Richardson withdrew his nomination in early January, some anonymous finger-pointing broke out over what the Richardson camp did or didn't reveal to the Obama camp concerning the investigation, which the Journal began reporting on in late August.
Richardson spokesman Gilbert Gallegos said at the time that Richardson was forthcoming.
On Friday, he declined to answer a Journal question concerning whether the Governor's Office made Obama's team aware of the subpoena during its vetting process.
Meanwhile, the New Mexico Finance Authority was apparently served with a subpoena but has refused to make a copy public.
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