SANTA FE — A state district court judge has ruled that former New Mexico State Investment Officer Gary Bland breached his duties by failing to disclose personal and professional ties, the latest development in a long-running lawsuit over politically-tinged investment deals.
The ruling by Judge Pro Tem Sarah Singleton could clear the way for Bland, the state’s top investment officer from 2003 through 2009, to be held liable for damages in a civil lawsuit filed by the State Investment Council.
“The court’s ruling emphasized that Bland, like all trustees of the State Investment Council, is a fiduciary, required to act solely in the interest of fund beneficiaries,” SIC spokesman Charles Wollmann said Tuesday. “We believe his failure to comply with those duties and disclose conflicts hurt the funds.”
The State Investment Council filed its civil lawsuit in 2011, alleging it lost more than $100 million in politically-influenced investment deals. It has hired an East Coast firm in an attempt to recover at least some of that money.
Defendants in the case include Anthony Correra, who was an adviser to former Democratic Gov. Bill Richardson, Correra’s son Marc Correra, who allegedly pocketed more than $22 million in placement fees from investment firms that got business with the state, and Bland, among others.
A recent motion filed by the SIC’s attorneys claims Bland frequently met with the Correras at the Rio Chama restaurant near the state Capitol in Santa Fe, sometimes with Richardson, and allowed Anthony Correra to take an active role in investment decisions.
Bland allegedly failed to disclose those relationships — and the millions of dollars in fees paid on SIC investments — for years before resigning under pressure in 2009. While Bland eventually admitted he knew about some of the payments, he maintained he had done nothing wrong.
In a Tuesday email, Bland, who is representing himself in the lawsuit, declined to comment on the judge’s ruling.
In her three-page ruling handed down last week, Singleton said Bland had not provided any valid legal arguments refuting the SIC’s evidence that he had breached his fiduciary duties, which are stipulated in state law.
“(The SIC) has presented evidence that Bland directed business to Marc Correra which was in Correra’s interest without disclosing this to his co-trustees,” Singleton wrote.
The judge also determined there was no need to hold a scheduled hearing on the SIC’s motion before making a ruling.
The scandal over placement fees led not only to Bland’s resignation, but also to 2010 legislation that changed the SIC’s makeup. The 11-member investment council currently oversees roughly $23.1 billion in state funds.