ABQ / Santa Fe News

Dirty Dealins

State Treasurer’s Indictment one in a Long Line in New Mexico Dirty Dealings

By Emily Esterson , 9-17-05

Why am I not surprised?

When New Mexico State Treasurer Robert Vigil was indicted yesterday on charges of kickbacks, what shocked me was the scale and complexity of Vigil's scheme, not that it happened.

Call me cynical, but I’ve been covering state and local government for years and small versions of kickbacks take place all the time. One very small sentence in the New Mexican’s account of the story on Saturday, “that’s the way we do business here in New Mexico,� apparently uttered by Vigil himself, summed it up.

I laughed out loud at both the ridiculousness of that statement (how third-world we are sometimes) and the truth of it. Yet somehow the culture here allows it to go unpunished.

Take, for example, former State Senator Manny Aragon. I was a huge critic of Aragon when he was in the legislature, because his special interests, political favors and, yes, even kickbacks, were so blatant as to be nearly laughable. He and his fellow legislator Raymond Sanchez held such an iron grip on New Mexico’s lawmaking it seemed more like a dictatorship than a democracy. Aragon, if you remember late nineties politicking, opposed the privatization of New Mexico’s prison system. Then, in 1998, he decided that privatization might be okay. And promptly received a healthy consulting contract from Wackenhut (New Mexico's legilslators are unpaid, except for per diems during the session). Later, Aragon did not disclose his financial interest in Wackenhut to the legislature and never abstained from any votes related to prison privatization or prison issues. There’s a good link here from the Center on Public Integrity (or lack thereof) on Aragon’s shenanigans.

Aragon, who served as Senate Pro Tem and had been in the Legislature for 20 years, took a job offered to him by Governor Richardson shortly after Richardson took office. He took over the presidency of the broke, floundering New Mexico Highlands University. And in what seems like a rigged vote, the school’s board of regents voted 5-0 in favor of Richardson’s Aragon appointment. Once in the big office, Aragon promptly began firing all the anglo professors, and hatched an expensive plan to build a golf course/housing project (can you say “construction jobs for a poor community?�) and so it goes.

Yet another example: In 2003, the State Investment Council, which reports to the now indicted Robert Vigil, chose to invest in a venture capital fund called Anila. Moses Joseph, the principal in Anila, also had a couple of so-called companies, which the state investment council also chose to invest in, amounting to a total take for Joseph of about $34 million (Eclipse Aviation, a legitimate startup company with actual employees and manufacturing in New Mexico, received $10 million in that round). At the time the whole enterprise seemed fishy to both me (then a newspaper editor) and Andrew Webb, who reported the story. Though we were in a hurry to break that news, we still learned enough about Joseph in four days of reporting to know that we would never give him any of our own money, let alone $34 million of the state’s oil and gas royalties. Because of our rush, we never got to the end of the money trail. This question still bothers me: Why would the state choose to invest in companies that were: a) not from here (a clear mandate of the legislation allowing such investments deems that the companies must be based in New Mexico) and b) seemed to be, well, vapor? At the time, we chalked it up to naiveness about venture investing, and/or a rush to get a high-profile deal done to ease political pressure from Richardson or Rick Homans, secretary of economic development. But I still don’t think that explains it all. I still believe that somewhere deep in the bottom of that story is a kickback, a sizeable campaign donation, or some other financial gain for someone. It took us only a few days to uncover Moses Joseph’s dirty dealings. The state had months to do due diligence. Why did they approve such an investment?

And so it goes. This story is the most high profile (it was on the CNN ticker last night) in a while, but I fail to be surprised. It’s no secret that power corrupts, and in New Mexico, the 47th poorest state in the union with one of the fattest state investment accounts, power and money corrupt inevitably.

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