Legislators want multiple NMFA reviews
‘It is vital to get to the bottom of what happened and why as soon as possible,’ say the two lawmakers who head the NMFA oversight committee.
In the wake of a revelation that the New Mexico Finance Authority’s fiscal year 2011 audit was fraudulent, two lawmakers who head an oversight committee say they want multiple reviews of the situation.
The statement from Sen. Mary Kay Papen, D-Las Cruces and chair of the NMFA Oversight Committee, and Rep. Patricia Lundstrom, D-Gallup and the committee’s vice chair, follows a Monday emergency meeting of the NMFA board. At that meeting, some board members questioned the agency’s decision to hire a firm to conduct its own investigation into the matter.
That investigation would be in addition to a special audit mandated by the State Auditor’s Office and a probe by the state’s Securities Division.
With NMFA’s board meeting again today, Papen and Lundstrom said they want it all. Here’s their full statement:
“We, like all the citizens of New Mexico, were shocked and are deeply troubled by last week’s revelation that the NMFA’s 2011 audit of its financial results appears to have been fabricated. It is vital to get to the bottom of what happened and why as soon as possible.
“We were disappointed, however, by the tone of the debate at (Monday’s) open special Board meeting, over what we believe is a prudent and urgent plan by NMFA management to address the situation appropriately and in a manner best designed to reassure the national financial markets on which NMFA and all state agencies requiring external financing and access to the capital markets rely.
“Retaining experience and nationally respected independent legal experts to review the matter and to make recommendations for improvements is – in our view – a key step to restoring confidence in NMFA and, by extension, New Mexico. At the same time, we have great respect for the state auditor, and the Securities Division of the Department of Regulation and Licensing, and we believe it is important that their independent reviews proceed independently and in parallel with the review commissioned by NMFA.
“Simply put, the stakes for New Mexico and all of its citizens are too high. We strongly urge that the NMFA’s Board vote (today) to support NMFA management’s investigative plan and recommendation to retain Steptoe & Johnson’s Evan T. Barr, a respected, former federal prosecutor.
“We look forward to seeing the results of the state auditor’s investigation, the Securities Division’s review, and the independent review by Mr. Barr, as soon as possible, and to taking whatever recommended steps are necessary to ensure the public’s confidence in New Mexico’s finances.”
The stakes are high. Moody’s said Monday the NMFA was under review for a possible downgrade, and Standard and Poor’s has put it on the watch list.
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