SANTA FE – Former New Mexico Finance Authority Controller Greg Campbell told a state district judge Thursday that his only intention when he falsified an internal audit was to help the NMFA get ready for a multimillion-dollar bond sale.
“I just don’t know why I – honestly – did it,” Campbell said during a plea and sentencing hearing in Santa Fe. “Because I knew I wasn’t going to benefit from it.”
Campbell, who was arrested in August, faced up to 30 years in prison for his role in the Finance Authority audit fraud scandal. However, he was not sentenced to jail time Thursday after pleading guilty to three felony charges.
State District Judge Stephen Pfeffer sentenced him to five years of probation. Under the plea deal, Campbell could have the felony charges – two counts of forgery and one count of securities fraud – dismissed if he completes the probation period without incident.
A prosecutor for the state Securities Division, which spearheaded the investigation into the NMFA scandal, said during Thursday’s hearing that Campbell cooperated fully with investigators and had no previous criminal record.
“We felt that prison was not an option – it would not accomplish anything,” prosecutor Patrick McNertney said.
Pfeffer said Campbell did not appear to profit from the falsified audit and deserves a second chance. He also ordered that Campbell will have to disclose his guilty plea to any future employer.
“It sounds like a time pressure to me that you should not have succumbed to but nevertheless did,” Pfeffer told Campbell. “It just so happens you were dealing with big amounts (of money) that made it so dramatic.”
Campbell left his job with the Finance Authority in June, shortly before the falsified 2011 audit was discovered. He was the only current or former NMFA employee facing charges in connection with the audit scandal.
However, NMFA Chief Executive Rick May was fired by the Finance Authority’s board during the scandal’s fallout, and the authority’s chief operating officer, John Duff, also lost his job.
Earlier Wednesday, May told members of a legislative oversight committee that Campbell was a “rogue employee” who had earned the trust of senior NMFA management for his sterling track record with the agency, which functions like a bank for local governments.
“He was a trusted employee, and we believed him,” May told lawmakers.
May also said he has “100 percent confidence” no money went missing as a result of the falsified audit, an assertion also made by Campbell’s attorney.
“There’s not the slightest trail of pecuniary advantage that leads back to Mr. Campbell,” said public defender Damian Horne, who described Campbell as an upstanding family man.
In addition to a personnel shake-up at the state agency, the audit scandal also caused the Finance Authority to delay loans to cities and counties and postpone a $40 million bond sale.
It has also prompted discussion about possible changes to the NMFA, with legislation expected to be introduced during the coming 60-day session of the Legislature to increase oversight of the agency and reshape its 11-member board.
Meanwhile, an outside review of the Finance Authority commissioned by the Legislature and presented Thursday to the legislative oversight committee outlines 25 recommendations to strengthen internal controls. At least several of those recommendations have been implemented, NMFA interim CEO John Gasparich said.
In addition, a separate forensic audit on the NMFA scandal is expected to be released Dec. 14.
Securities Division Director Daniel Tanaka told reporters Thursday that the Campbell plea deal likely marks the end of the agency’s criminal investigation into the NMFA, barring any new findings, but said a report that will outline systemic failures in the Finance Authority’s management will be published next month.
“The message being sent today is that, if you break the law, even if it’s not for personal profit, we’re going to vigorously investigate it, determine what happened and hold you accountable,” Tanaka said.
Campbell declined to talk to reporters when he left the courthouse in Santa Fe.
He told the judge earlier that he is considering moving back to the East Coast, where he is from, and wants to continue providing for his family.
“I just thought I was trying to get something done for the authority,” he said. “I didn’t want to have the authority hurt in any way, and some things might have been hurt … that I truly am sorry for.”
Ex-NMFA Official Pleads GuiltyEDDIE MOORE/JOURNALFormer New Mexico Finance Authority Controller Greg Campbell pleads guilty Thursday. The felony charges could be dismissed if he completes probation with no problems.Former controller gets probation in fake audit caseSee EX-NMFA on PAGE A2from PAGE A1Ex-NMFA Controller Pleads Guilty, Gets Probation”It sounds like a time pressure to me that you should not have succumbed to but nevertheless did. It just so happens you were dealing with big amounts (of money) that made it so dramatic.”STATE DISTRICT JUDGE STEPHEN PFEFFER
— This article appeared on page A1 of the Albuquerque Journal