Rick May, former CEO of NM Finance Authority

Rick May is gone as the chief executive officer at the New Mexico Finance Authority (NMFA) but with a possible lawsuit in the offing, his dealings with the quasi-governmental entity may be far from over.

The NMFA Board on Friday (Sept. 28) decided to terminate May’s employment with William Fulginiti being the only member of the board who voted against the motion.

“It’s time to move on,” board chairwoman Nann Winter said after the decision was reached. She and fellow board member Jon Barela wouldn’t offer specific reasons why they fired May, citing personnel issues and potential litigation.

Capitol Report New Mexico has sent an e-mail to May asking for his reaction. As soon as we receive it, we’ll post it.

Update: On Friday afternoon, May sent out a 2-page news release saying, “As I had suspected, the majority of the Board is not really interested in learning what happened as their real goal for improper purposes seems to be to shift the blame.” May also added that, “I have no other choice than to continue pursuing all legal and other options to preserve and protect my longstanding reputation for honesty and integrity.”

Exactly three weeks ago, May sent a memo to board members that ended by stating, “I shall pursue any legal and other options to preserve and protect my longstanding reputation for honesty and integrity.”

On the same day, in a statement to the media, May accused some board members of being “more interested in designating a scapegoat than in discovering what really happened.”

What happened was a bogus audit that was allegedly conducted by a controller at the NMFA, which spurred criminal and internal investigations that have led Wall Street ratings agencies to consider downgrading the state’s bond rating. A downgrade could cost taxpayers millions in higher payments on the many municipal projects the NMFA funds.

Since the scandal broke in July, the NMFA has had to put a number of expensive projects, such as infrastructure deals for cities and towns across the state, on hold.

Sources within the board have told Capitol Report New Mexico that May was ultimately responsible for the running of the NMFA and should have been more alert to the filing of the faked audit.

May has countered that, “I was the first person to report the situation to the Governor’s Office, the State Auditor’s Office and the State Police.”

On August 9, May had been placed on administrative leave with pay from the $150,000-a-year job. John Gasparich has been the acting CEO for more than a month so, before Friday’s decision to let May go, taxpayers had been paying two people to do one job.

A possible lawsuit by May against the NMFA may be strengthened by the fact that last week a grand jury in Santa Fe refused to indict the authority’s chief operating officer, John T. Duff, who was arrested at NMFA offices on August 8.

At the time of the arrest, in the words of Securities Division chief Daniel Tanaka, Duff had “cooked the books” and collaborated with controller Greg Campbell in forging financial information.

While Duff was cleared by the grand jury last week, Campbell was indicted on 12 felony charges.

Duff also says he’s considering suing the state.

“This thing, I think, was a very badly flawed prosecutorial effort based on misunderstandings and half-understandings,” the 70-year-old Duff told Dan Boyd of the Albuquerque Journal, adding that “serious damage to my reputation occurred.”

The board has placed Duff on leave without pay from the NMFA. Duff’s name did not come up in Friday’s board meeting.

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Here’s a copy of the news release May sent out and his disclosure that he met with the NMFA executive committee Monday (Sept. 24) when May says, “It was evident that my fate had been pre-determined and Board minds had been made up.”:

Richard E. May(1)- Press Release – September 28, 2012