Haven’t state officials repeatedly said in the midst of the current investment scandal that the fees being paid to third-party marketers who helped companies win state investment contracts weren’t on their radar?
They have said that. In fact, Gilbert Gallegos, a spokesman for Gov. Bill Richardson, said this last month:
“The state did not pay these fees, and the governor was not informed of any fees paid by private fund managers to third-party marketers,” Gallegos told me. “Those were private transactions, which were only disclosed after the state asked for more information about the fees from the fund managers who paid them.”
Other officials have been quoted in the New Mexico Independent about the topic as well:
“‘Until recently a review of a fund was about quality of the investment. Placement agents was not the first thing on the list,’ said Bob Jacksha, chief investment officer for the Educational Retirement Board.
“Added State Investment Officer Gary Bland: ‘Until this issue arose in New York, none of us was concerned. We had no reason to be concerned.’”
They’re referring, of course, to the pay-to-play investment scandal that began in New York and has spread to a number of other states, the most prominent being New Mexico. It’s in the context of their comments that an article published Wednesday in the Albuquerque Journal is so interesting. From the Journal:
“Maybe they didn’t want to know who was making all that money. Maybe they didn’t care. Maybe they didn’t want you to know who was cashing in. Maybe it was just an innocent oversight.
“Whatever.
“The bottom line is this: In the wake of a corruption scandal at the state Treasurer’s Office in 2005, a policy was drafted that called for public disclosure of fees paid to so-called third-party marketers on government investment deals.
“A document that became known as the ‘Governor’s Transparency Policy’ — put together for Gov. Bill Richardson — recommended disclosure of all the fees.
“That didn’t happen. The policy was never adopted, not even by the State Investment Council, which Richardson chairs and controls.”
Could we have known about all the potential shenanigans years earlier? Could state officials have helped expose and change a shady practice and avoided the current controversy?
Maybe we’ll never know.