{"id":22851,"date":"2010-10-27T08:57:36","date_gmt":"2010-10-27T14:57:36","guid":{"rendered":"http:\/\/www.nmpolitics.net\/index\/?p=22851"},"modified":"2010-10-28T07:24:50","modified_gmt":"2010-10-28T13:24:50","slug":"insurance-deal-created-potential-conflict-for-denish","status":"publish","type":"post","link":"https:\/\/nmpolitics.net\/index\/2010\/10\/insurance-deal-created-potential-conflict-for-denish\/","title":{"rendered":"Insurance deal created potential conflict for Denish"},"content":{"rendered":"
\"\"<\/a>

Diane Denish (Photo by Heath Haussamen)<\/p><\/div>\n

Insurance company Denish\u2019s family controls works for agency whose board she chairs; situation was disclosed<\/h4>\n

While Lt. Gov. Diane Denish<\/a> has chaired the New Mexico Mortgage Finance Authority\u2019s<\/a> board of directors, an insurance company controlled by Denish\u2019s family has made money by helping the agency obtain various types of liability insurance.<\/p>\n

Denish\u2019s gubernatorial campaign says she has never had a personal financial interest in the company \u2013 at least for all practical purposes. And the agency has disclosed the relationship between Denish and the company in audits and at board meetings.<\/p>\n

When the deal between Daniels Insurance and MFA began is unclear, but it continues to this day. How much money Daniels Insurance has made working for MFA also isn\u2019t clear.<\/p>\n

The company acts as a broker, identifying other companies that can provide types of insurance MFA is seeking. Daniels Insurance gets paid a commission through the company MFA hires, so there are no direct financial transactions between MFA and Daniels Insurance. MFA has few records relating to how much money Daniels made from its work for the agency.<\/p>\n

Agency staffers \u2013 not the board Denish chairs \u2013 consider recommendations from Daniels Insurance and decide which companies to hire, according to Marjorie Martin, MFA\u2019s attorney.<\/p>\n

Martin said Daniels Insurance has acted as a broker for MFA on a number of types of liability insurance including auto, mortgage protection, workers compensation and lawyers\u2019 professional liability.<\/p>\n

Martin said MFA has been unable to locate records that indicate when the deal began. MFA record retention policies require that the agency maintain records for seven years. The MFA\u2019s deal with Daniels Insurance is still in place, Martin said.<\/p>\n

Chris Cervini, spokesman for Denish\u2019s gubernatorial campaign, said Denish has acted appropriately as it relates to the deal between MFA and Daniels Insurance.<\/p>\n

\u201cAs a matter of general practice, Diane always sought to be open about any conflicts or potential conflicts and to recuse herself where a potential conflict may exist,\u201d Cervini said. \u201cShe never attempted to influence the MFA with regard to any company.\u201d<\/p>\n

He pointed out that MFA is a quasi-governmental organization that doesn\u2019t use taxpayer dollars for operations.<\/p>\n

Denish owns no stock in company<\/h3>\n

Daniels Insurance was founded by Denish\u2019s father, Jack Daniels. When her father died in September 2003, according to an Albuquerque Journal article<\/a>, his will called for Denish and his nephew, Michael Tinley, to handle distribution of his estate. The estate became bogged down in litigation between family members over changes that had been made to a 1994 trust agreement.<\/p>\n

Denish\u2019s father willed her 7,200 shares of stock in Daniels Insurance, according to the Journal. But Cervini said that, for all practical purposes, that financial interest in the company never became a reality.<\/p>\n

It was determined during the course of settling the estate that only employees can own stock in the company under its articles of incorporation. Denish isn\u2019t an employee, so she had to give up the stock that was willed to her, Cervini said.<\/p>\n

\u201cAfter the settlement of the estate in 2007, the stock in the company was transferred to her for a minute (literally) \u2013 the time it took for her to sign it over to the company,\u201d Cervini said. \u201c\u2026 Her father designated stock for her in his will, but she did not take ownership of it because of that rule.\u201d<\/p>\n

Denish\u2019s cousin Michael Tinley and his son David Tinley are both employees of Daniels Insurance. Michael Tinley is listed in PRC records as the company\u2019s director, and he runs the company\u2019s office in Hobbs. David Tinley works in the company\u2019s Albuquerque office.<\/p>\n

Situation was disclosed<\/h3>\n

Denish joined the MFA board and became its chair in 2004. The MFA audit for that fiscal year<\/a> discloses the financial relationship with Daniels Insurance.<\/p>\n

\u201cThe Authority purchases various insurance policies from an insurance company that is controlled by the family of the Authority\u2019s chairman of the board,\u201d the audit states.<\/p>\n

The agency made similar disclosures in its 2005<\/a>, 2006<\/a>, 2007<\/a> and 2008<\/a> audits, but not in its 2009<\/a> audit.<\/p>\n

Disclosure of the relationship between Denish and the company was also made at board meetings.<\/p>\n

For example, according to the minutes of the July 16, 2008 board meeting, a staffer \u201cinformed the Board that this disclosure from the Chair discloses her family owns a controlling interest in the Daniels Insurance Company which the MFA has been doing business with for a number of years.\u201d (You can read Page 1<\/a>, Page 2<\/a> and Page 3<\/a> of the minutes.)<\/p>\n

How much has Daniels Insurance made working for MFA?<\/h3>\n

Since Daniels Insurance isn\u2019t paid directly by MFA, how much the company has been paid for its work isn\u2019t clear from public records. But there are a couple of clues in disclosure documents.<\/p>\n

The minutes of the July 16, 2008 meeting state that the total commission Daniels Insurance made in 2008 was $7,526. And the disclosure in the 2006 audit states that the total amount \u201cof these particular insurance expenses for 2006 and 2005 are $10,000.\u201d<\/p>\n

Martin said MFA has no contract or bidding documents \u201crelated to procurement of services from Daniels Insurance Company.\u201d The services provided by Daniels fall into the \u201csmall purchases\u201d exemption to the agency\u2019s procurement policies. That means the services have been valued at less than the $25,000 per calendar year. (In 2009, the agency increased the dollar amount allowed under the small purchases exemption to $50,000, but before that it was $25,000.)<\/p>\n

Michael and David Tinley both said the company couldn\u2019t discuss its deal with MFA, for privacy reasons, unless the MFA directed the company to do so.<\/p>\n","protected":false},"excerpt":{"rendered":"

While Lt. Gov. Diane Denish has chaired the New Mexico Mortgage Finance Authority\u2019s board of directors, an insurance company controlled by Denish\u2019s family has made money by helping the agency obtain various types of liability insurance.<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11,1],"tags":[108,107],"class_list":["post-22851","post","type-post","status-publish","format-standard","hentry","category-news-and-analysis","category-uncategorized","tag-2010-election","tag-roundhouse"],"_links":{"self":[{"href":"https:\/\/nmpolitics.net\/index\/wp-json\/wp\/v2\/posts\/22851","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/nmpolitics.net\/index\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/nmpolitics.net\/index\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/nmpolitics.net\/index\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/nmpolitics.net\/index\/wp-json\/wp\/v2\/comments?post=22851"}],"version-history":[{"count":0,"href":"https:\/\/nmpolitics.net\/index\/wp-json\/wp\/v2\/posts\/22851\/revisions"}],"wp:attachment":[{"href":"https:\/\/nmpolitics.net\/index\/wp-json\/wp\/v2\/media?parent=22851"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/nmpolitics.net\/index\/wp-json\/wp\/v2\/categories?post=22851"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/nmpolitics.net\/index\/wp-json\/wp\/v2\/tags?post=22851"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}