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Months after the N.M. Educational Retirement Board (ERB) reversed courses and releases subpoenas it had previously withheld from the public, the State Investment Council (SIC) did the same on Tuesday.
“… in the staff’s ongoing legal review, with the input of Council Members, and under my own direction as Investment Officer, the Investment Office will today publicly release the subpoenas to all who have asked for them previously,” interim State Investment Officer Robert Jacksha wrote in a letter to SIC members.
The move comes shortly after Jacksa replaced former State Investment Officer Gary Bland in that job. Bland resigned last month in the midst of the national investment scandal that is the subject of criminal and other investigations in New Mexico, New York and elsewhere.
Already, Saul Meyer, the former investment adviser to the SIC and ERB, has admitted to recommending “investments that were pushed on him by politically-connected individuals in New Mexico” in pleading guilty to unrelated charges in New York. Meyer is reportedly cooperating with investigators in New Mexico.
That scandal is the reason for the subpoenas. The SIC has received four – two from a federal grand jury (click here and here to read them) and two from the Securities and Exchange Commission (here and here).
The U.S. attorney’s Office and Securities and Exchange Commission (SEC) are both investigating. No criminal charges have been filed in New Mexico.
The subpoenas show that Bland was called to testify before the SEC in its investigation. Bland, according to SIC Member Pat Lyons, the state land commissioner, resigned after SIC members learned that he had pressured investment firms to hire certain third-party marketers.
Those third-party marketers – or “placement agents” who help investment firms get lucrative state contracts for a fee – are at the center of the scandal in New York and New Mexico.
The name of the placement agent who has received the most attention in New Mexico – Marc Correra – also shows up in the documents released Tuesday by the SIC. Correra shared in as much as $22 million in placement fees during Gov. Bill Richardson’s tenure, which has sparked anger among many.
Correra is the son of Anthony Correra, a prominent friend and Richardson donor who’s also been dragged into the controversy because he was involved in the hiring of Bland at the SIC.
Neither Correra has been publicly accused of wrongdoing.
So the bottom line in New Mexico, at least based on what we know publicly: Bland, according to Lyons, was allegedly pushing investment firms to hire certain placement agents. And Aldus Equity’s Meyer was recommending that the state make investments that were pushed on him by politically connected individuals even though, by his own admission, those investments may not have been in the best interest of the state.
SIC joins ERB, finance authority in releasing subpoenas
The SIC is the third government agency to reverse courses and release subpoenas that are part of a criminal investigation after initially refusing to do so. The ERB released subpoenas related to the investment scandal in June, with Chairman Bruce Malott saying at the time that “Sunlight is the best disinfectant, and I continue to believe the public’s right to see their government at work should never be marginalized.”
And the New Mexico Finance Authority (NMFA) released subpoenas in September that were part of the federal investigation into allegations of pay to play in the Richardson administration involving CDR Financial Products.
Though the SIC and ERB have released the subpoenas in the midst of the probes into the investment scandal, NMFA refused to released subpoenas it had received until after the investigation involving NMFA ended in August without charges being filed.