Tuesday, February 17, 2009

NM in the news (NYT, no less!)

[NM's Rail Runner light rail system; photo: Rich Scibelli Jr. for The New York Times]
Bond Advice Leaves Pain in Its Wake
Published: February 16, 2009
... In some places, Mr. [David] Rubin’s firm also contributed to political campaign funds. In New Mexico, federal authorities are investigating whether CDR [CDR Financial Products of Beverly Hills, Calif.] made improper payments to Gov. Bill Richardson’s campaigns in exchange for work on a $1.6 billion transportation bond issue, a disclosure that caused Mr. Richardson to withdraw from consideration to join the Obama administration.
One type of trade the firm recommended was subsequently banned — but not before CDR helped New Mexico execute eight such trades. CDR; the law firm of Ballard, Spahr, Andrews & Ingersoll; the accounting firm of Grant Thornton; and the Bank of Albuquerque took a cut on each trade, earning $556,000 in total.
New Mexico officials said they believed the state’s finances were better off because of CDR’s services but were unable to provide a complete accounting.
The I.R.S. has disallowed at least seven housing bond deals that were assisted by CDR, in Florida, California, Virginia, Oklahoma, Arkansas and North Dakota, according to notices filed in a municipal data base.

There were even problems in New Mexico. The year before the transportation bonds were sold, the firm helped a regional housing authority there issue bonds that were later stripped of their tax exemption by the I.R.S., which found an improper relationship between CDR and Société Générale.
It was pretty cool to see NM's Rail Runner pictured on page 1 of today's NYT Biz section!

1 comment:

  1. Looks to me like 18 bucks round trip the whole distance. Not bad if I cyphered correctly. I may have to take that ride.