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Judge tosses two more charges in Padilla case

Former state Taxation and Revenue Secretary Demesia Padilla talks to her attorney, Paul Kennedy, during her July 2018 arraignment in Santa Fe. (Eddie Moore/Journal)

Copyright © 2019 Albuquerque Journal

SANTA FE – In another legal setback for Attorney General Hector Balderas’ office, a state judge on Friday dismissed two of the three remaining public corruption charges against former New Mexico tax secretary Demesia Padilla.

In response to a motion from Padilla’s defense attorney, District Judge Mary Marlowe Sommer ruled that the AG’s Office had failed to provide any evidence that the two alleged crimes occurred in Santa Fe County, where the charges were filed.

But a spokesman for the Attorney General’s Office said Friday that the state’s top prosecutor plans to refile the two charges – both felony embezzlement charges – in a different judicial district in the coming days.

“Gov. Martinez appointed Demesia Padilla to serve the state of New Mexico in Santa Fe, and we thought it was appropriate to present this corruption case in front of a jury of her peers,” AG’s Office spokesman David Carl said. “However, we will comply with the court’s request to conduct two jury trials in two different counties.”

For now, the judge’s ruling means Padilla faces just one felony charge – engaging in an official act for personal financial gain – with a trial set to start this summer.

She originally faced eight criminal counts, but the same judge dismissed five of the counts last month, saying the AG’s Office had filed some misdemeanor charges against her under parts of the state’s Governmental Conduct Act that are not supposed to be used as a weapon by prosecutors.

Padilla, who was appointed by Martinez to lead the state Taxation and Revenue Department in 2011, has pleaded not guilty to charges that she embezzled more than $25,000 from a Bernalillo-based company, Harold’s Grading & Trucking, and using her appointed position to push for favorable tax treatment.

Her defense attorney, Paul Kennedy, has filed numerous motions in the case.

One motion accuses AG’s Office investigators of engaging in improper conduct by secretly recording Kennedy’s conversation with Padilla – with a coffeepot outfitted with a recording device – during a break in an interview at the Attorney General’s Office in Albuquerque before Padilla was arrested.

Several current and former AG’s Office investigators summoned Friday to testify said they had never seen or heard such a recording, although they acknowledged using both the coffeepot recorder and another secret recording device.

“I don’t feel like I’ve done anything sneaky or underhanded,” AG’s Office special agent Ed Griego said in response to a question from Kennedy about why he did not mention the recording devices in his report about the Padilla interview.

Ultimately, Marlowe Sommer ruled that Padilla’s defense attorneys would be allowed to inspect the devices, some of which were on loan from other law enforcement agencies, before the trial gets underway. But the judge stopped short of making a ruling on whether entire case should be dismissed over the surreptitious recordings.

Padilla, a certified public accountant, could face up to 18 months in prison and a fine of up to $5,000 if convicted of the remaining charge against her.

The embezzlement charges the AG’s Office plans to refile would carry stiffer punishments.

Padilla resigned from the Taxation and Revenue Department in December 2016, shortly after state investigators raided the agency’s office in Santa Fe in search of tax documents connected to Padilla and her husband.

She was then charged by the Attorney General’s Office in June 2018, becoming the latest in a strong of New Mexico elected and appointed officials to face public corruption allegations.