SIC Files Suits Against Gary Bland, The Correras, Guy Riordan and Others

The State Investment Council has filed two civil lawsuits alleging that the state was the victim of a pay-to-play scheme.

A suit filed in state district court names as defendants former state Investment Officer Gary Bland and Guy Riordan, a former broker and former friend of Gov. Bill Richardson.

"During Bland’s tenure, Governor Richardson’s supporters and senior members of his staff requested Bland to secure political contributions from investment management firms that had received fees in connection with investments made by the Public Trust Funds," the complaint says.

"During his tenure, Bland caused NMSIC to make alternative investments for the purpose of benefiting politically-connected individuals, rather than solely on the basis of the underlying merits of the alternative investments. Collectively these investments involved a commitment of more than ($2 billion) of the Public Trust Funds’ assets."

Bland told The Associated Press today that the lawsuit was "absurd." I left a message for Riordan, but haven't heard back.

The suit says Riordan "was paid substantial fees in connection with alternative investments made by NMSIC."

In a federal suit the defendants include Anthony Correra, described in one of the suits as "Gov. Richardson’s personal friend, fund raiser and confidante" who often purported to speak for the governor; his son Marc Correra, an investment broker who shared in $22 million in third-party marketing fees; and several figures from the New York investment scandals, including Saul Meyer; the Texas-based Aldus Equity Partners, which for years was the SIC's investment councilor, and Hank Morris, political advisor and fundraisier for former New York State Comptroller Alan Hevesi.

Hevesi is not named in the New Mexico suit, but his son Daniel is. Both Alan Hevesi and Morris were sentenced to prison this year in the New York scandals.

In a news release State Investment Officer Steve Moise said, “The State Investment Council takes this action today in hopes of recovering millions of dollars improperly taken from the citizens of New Mexico by those who violated their professional duties and the public trust, and their cronies who participated in and profited from such breaches of duty."

The same news release quotes Gov. Susana Martinez, who is chairwoman of the SIC, saying "As we wait for justice in the criminal courts, we must aggressively pursue legal action of our own. These efforts must continue until all responsible parties are held accountable for the abuses that occurred here in New Mexico.”

Martinez called upon the investment managers who entered into payment arrangements with third party placement agents to obtain SIC investment business to contact the Attorney General's Office and fully disclose the details of those arrangements “before the Attorney General knocks on their doors.”

Representing the SIC is the Attorney General's office and the Day Pitney law firm, which also represents the New York comptroller's office in trying to recover lost investments.

I called Richardson's office for comment, but a spokeswoman said he's traveling and couldn't immediately be reached. If I hear back, I'll update this.

UPDATED 5-10-11: Here's a copy of the federal suit as well as the complaint in state court.

Federal & State Lawsuits SIC