Man at the center of the NMFA controversy: “I put those papers together with no malicious intent”
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He’s been called a rogue employee who’s supposedly responsible for turning in a fraudulent audit that plunged the New Mexico Finance Authority into a dire fiscal crisis and possibly leading to a downgrade of state bonds that could cost millions.
But Greg Campbell, a former controller at the NMFA says, “I put those papers together with no malicious intent” although he does admit that being the target of the accusations “probably is fair because it was under my supervision to get the audit done and completed.”
KOB-TV interviewed Campbell, who said he just returned to Albuquerque from a 3-week vacation with his family. Here’s the video from KOB’s 6 p.m. newscast on Friday (July 21):
Greg Campbell, former NMFA controller Courtesy: KOB-TV
But there are plenty of unanswered questions as the NMFA, its board, the State Auditor’s Office and the state securities division start finding out what actually happened, how much the numbers are off in the audit and whether ratings agencies like Standard & Poor’s and Moody’s downgrade New Mexico’s Aaa rating, which could cost the state millions in higher interest costs on bonds the authority issues to state agencies and entities.
After a couple emergency meetings last week, the NMFA is trying to rework its contract to establish an independent, third-party investigation. The board meets agains on Thursday (July 26) to discuss the mess. Maybe Campbell will be called to tell board members what he knows. We’ll see.
Posted under Capitol Report.
Tags: Greg Campbell, KOB-TV, New Mexico Finance Authority, NM Finance Authority, State Auditor's Office
8:39 am on July 22nd, 2012
KOB’s interview was a disappointment. They failed to ask Campbell the most important questions in follow-up to his comment that he put the audit report together.
Questions like, why would the controller be preparing the independent auditor’s report for them? Even as the internal audit director in firms, I never was asked for input into the content of the External Auditor’s report, let alone given the task of drafting it. That would compromise the integrity and independence of the audit. And second, when did he put this report together – before or after the alleged December 11the meeting. Then, why would he state a meeting had occurred that had not and was not going to occur on that date – the auditor wasn’t even in New Mexico on that date.
Last, I would have asked him exactly who this audit report was distributed to and who was aware that he was preparing the draft himself. I would also like to know where Gunderson is and what they actually did for the fees they were paid for this audit. There is a lot more to this story that has not come out. I’m waiting!
12:42 pm on July 22nd, 2012
I’m impressed that the man hadn’t absconded to Monaco. It seems entirely possible that the opportunity was there for one of the managers to walk off with millions of $$$ undetected. I had envisioned a clever man who realized he had the keys to the candy store and couldn’t resist the temptation presented to him. It now looks like he was less opportunist and more likely recklessly incompetent.
The credit agencies will price in the risk whether the lack of controls led to fraud or not. The bondholders will still sue for damages due to mismanagement when the credit agencies downgrade. I don’t see how the Authority issues any new bond offerings until the personnel are replaced and new processes are implemented. I wouldn’t be surprised if the Authority was folded into a different department and never issued another offering again. This is a real disaster.
9:03 pm on July 22nd, 2012
Congrats to Peter St. Cyr on getting this guy on the record making some stunning admissions. But so many questions could not be asked in this format. I am sure the law enforcement agencies will be following up and asking WHY? And did you alter the 2010 audit letters to make them appear to have been issued in 2011? WHY? What a story this is.
12:31 am on July 23rd, 2012
Watching the interview, Campbell seemed to be taking the blame for the fraudulent report rather stoically, makes me wonder if he’s the fall guy. He didn’t try to defend himself at all, but simply immediately assumed all responsibility for the report, in essence saying ‘It was all my fault, you don’t have to look any further.’ That, to me, seems a little fishy, and I wouldn’t mind if more investigation was done into the Campbell’s supervisors. Campbell apparently stated that he should have made it more clear that this report was simply a draft report, but from what I’ve been reading, this was a fraudulent report, not a draft report. And, even if that is the case, then we should be asking why his supervisors didn’t realize this was a draft report and not the final report.