A grand jury in Santa Fe last week indicted the former controller for the New Mexico Finance Authority on charges of submitting a forged audit for the fiscal year 2011 and circulating that audit to bond investors, officials said.
Gregory M. Campbell, the former controller for the NMFA, was cited for eight counts of securities fraud and four counts of forgery.
A presentation was made to the same grand jury regarding John Duff, Campbell’s former supervisor and chief operating officer for the New Mexico Finance Authority, but the grand jury declined to indict Duff.
“This should send a message to everyone doing business in New Mexico, including those in public service, that you will not get away with misleading investors and publishing fake financial statements,” according to J. Dee Dennis Jr., the superintendent of the New Mexico state Regulation and Licensing Department.
On July 13, the Securities Division of the New Mexico Regulation and Licensing Department began investigating the NMFA’s alleged fraudulent audit from the 2011 fiscal year.
On Aug. 1, the Securities Division executed a search warrant at the Santa Fe offices of the NMFA.
Investigators have also interviewed numerous current and former NMFA employees and others.
“The Securities Division has done its duty by conducting a thorough investigation and bringing about a resolution to this criminal investigation,” said Daniel S. Tanaka, director of the Securities Division.
The independent auditors, who were hired by the NMFA to perform the external audit, told investigators that they never completed an audit of the 2011 financial statements and that there was no exit conference held to discuss the results of the audit.
The indictment alleges that Campbell forged the fiscal year 2011 audit report and caused the forgery to be widely disseminated throughout the investing community.
“This was an extremely technical case which hinged in part on complex accounting standards,” Tanaka said.