Land of Disenchantment: New Mexico’s Pension Flap

It was what political insiders call “bad optics” — an appearance, at the least, of impropriety. Bruce Malott, chairman of New Mexico’s Educational Retirement Board pension fund, borrowed $350,000 from the father of Mark Correra, a placement agent who had secured money management mandates for his clients with the $8.5 billion ERB fund. In September, Malott, who had been appointed by Democratic Governor Bill Richardson, quit the ERB while insisting that though he did borrow the money, he’d done nothing wrong. He says he wasn’t aware of Mark Correra’s role at the ERB until last year.

Democratic lieutenant governor Diane Denish, who hopes to succeed Richardson, declared in a written statement: “Obviously, Mr. Malott knew this was a clear conflict that should have been disclosed. He should have disclosed it and resigned a long time ago.”

Speaking of disclosure, Denish’s statement neglected to mention that Malott’s accounting firm was until July treasurer of her campaign.

Investigators from the FBI and SEC are looking into pay-to-play at New Mexico’s public pension funds.