#1 "Another Liberal Politicians Seat For Sale To The Highest Bidder !"
12-15-2008, 10:50 AM
- Join Date
- Aug 2005
Grand Jury Probes Richardson Donor’s New Mexico Financing Fee
-- A federal grand jury is investigating how a company that advised Jefferson County, Alabama, on bond deals that threaten to cause the biggest municipal bankruptcy in U.S. history, did similar work in New Mexico after making contributions to Governor Bill Richardson’s political action committees.
The grand jury in Albuquerque is looking into Beverly Hills, California-based CDR Financial Products Inc., which received almost $1.5 million in fees from the New Mexico Finance Authority in 2004 after donating $100,000 to Richardson’s efforts to register Hispanic and American Indian voters and pay for expenses at the Democratic National Convention in 2004, people familiar with the matter said.
The Federal Bureau of Investigation asked current and former officials from the state agency if any staff members in the governor’s office influenced CDR’s hiring, said the people, who declined to be identified because the proceedings are secret. Richardson, who is President-elect Barack Obama’s designate for Commerce Secretary, has a staff of at least 30 people.
“They’re looking at everything related to CDR,” William Sisneros, the finance agency’s chief executive officer, said of the FBI probe. “They’re just trying to evaluate all the relationships to see what CDR was doing for the money.”
The investigation reflects another front in nationwide efforts by U.S. prosecutors to investigate so-called pay- to-play in the municipal bond market. The term refers to banks and advisers who make political contributions or personal gifts to public officials in return for fee-paying financing assignments.
On Dec. 1, Birmingham, Alabama’s mayor, Larry Langford, was charged by federal prosecutors with soliciting $235,000 in loans, expensive clothes and jewelry from Montgomery, Alabama-based bond underwriter Blount Parrish & Co. Langford, the former president of the Jefferson County Commission, included the firm on bond and derivative deals that netted it about $7.1 million. CDR, which wasn’t named in that indictment, advised Jefferson County on the derivatives.
The New Mexico probe comes two years after the FBI searched CDR’s offices as part of a nationwide investigation into whether banks and advisers conspired to overcharge local governments on financing deals. That probe by the New York office of the U.S. Department of Justice’s Antitrust Division is ongoing, and CDR says it is cooperating.
A company spokesman denied wrongdoing in New Mexico.
“To suggest that there’s a pay for play element is just inaccurate,” said CDR’s Allan Ripp. “There was no involvement by the governor. CDR knows for certain that they were selected on the basis of their track record.”
New Mexico finance authority officials haven’t complained about the company’s advisory work.
Richardson, a 61-year-old Democrat, is a former U.S. Energy Secretary who ran for president in 2008. He served 15 years in Congress and was the U.S. ambassador to the United Nations in 1997-98. He was a consultant to Salomon Smith Barney Inc., a unit of New York-based Citigroup Inc., from July 2001 to January 2003.
Elected New Mexico’s governor in 2002 and re-elected in 2006, Richardson appoints five directors to the New Mexico Finance Authority’s 12-member board, including the chairman. Five other directors are members of his cabinet.
CDR made $1.48 million advising the authority on interest-rate swaps and restructuring escrow funds for $1.6 billion of transportation bonds issued by the agency, according to state records.
|« Previous Thread | Next Thread »|