SEC subpoenaed former NM state investment officer

AP News
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Posted: Nov 18, 2009 11:22 AM

The Securities and Exchange Commission subpoenaed former state Investment Officer Gary Bland to testify as part of an investigation into public investment funds in New Mexico, according to documents released Tuesday.

The disclosure came in copies of subpoenas that the State Investment Council received from the SEC and a federal jury in Albuquerque. The council released the documents in response to a public records request by The Associated Press and other news organizations.

Bland, who had been in charge of day-to-day investment operations since 2003, did not return a call to his cell phone Tuesday seeking comment. He resigned last month amid the federal investigation and pressure to remove him by members of the council, which oversees management of state endowment funds valued at nearly $13 billion.

State Land Commissioner Pat Lyons has said the move to oust Bland was prompted by allegations that Bland pressured investment firms to hire third-party placement agents.

The SEC ordered Bland to testify in September at the agency's regional office in Denver. Documents released by the council do not indicate what Bland was questioned about.

Charles Wollmann, a spokesman for the council, said Bland talked with the SEC, but Wollmann did not have any details.

Among the documents subpoenaed by the SEC and grand jury were Bland's e-mails. The SEC also sought documents of any communications between the council and a politically connected Santa Fe broker and third-party placement agent, Marc Correra, and his father, Anthony Correra.

Marc Correra shared in nearly $22 million in fees for helping money management firms win investments with the council and a state educational pension fund, according to state records. Correra's lawyer has said there was no wrongdoing by his client.

Correra's father is a close friend of Bland and served on a committee that recommended Bland for the investment officer position after Gov. Bill Richardson was elected in 2002. The elder Correra also served as a director of a nonprofit foundation that Richardson formed to do voter registration in preparation for the 2004 presidential election.

The U.S. Attorney's Office in Albuquerque is handling the grand jury investigation, which could lead to criminal charges. The SEC has the power to bring civil charges for securities violations, including fraud.

The federal investigation has been under way since at least April, when the grand jury issued a subpoena for a wide range of documents about third-party marketers and Aldus Equity Partners, a Dallas-based firm that served as an adviser to the council and the educational retirement fund.

A co-founder of Aldus, Saul Meyer, has pleaded guilty to securities fraud in New York involving a pension fund there. Aldus was fired by the New Mexico investment agencies after being implicated in the New York scandal earlier this year.