Lobbyist played dual role in Richardson's world

Posted 1/13/2009 11:24:00 PM

Bloomberg.com continues to lead the way in uncovering the story behind a federal investigation into allegations of pay-to-play in Gov. Bill Richardson’s administration with a new report highlighting the dual role of a man who served as a director for one of the governor’s political action committees while also reportedly working to help a bank that gave money to the PAC win a state bond contract.

Fred DuVal is a Phoenix lobbyist who worked as a consultant for UBS AG. His firm was credited by the bank with helping win “an assignment to sell a portion of $1.1 billion of bonds for the New Mexico Finance Authority in April 2004,” the news organization reported today in an article you can read by clicking here. That came two months after DuVal was named as a director of Si Se Puede! Boston 2004 Inc., one of two Richardson PACs at the center of the federal investigation that caused Richardson to withdraw his nomination to be commerce secretary a little more than a week ago.

The PAC received $75,000 from CDR Financial Products around the same time in 2004 that it won a finance authority bond contract related to the UBS contract that ended up paying CDR almost $1.5 million. A federal grand jury is investigating whether there was a deal struck that led to the contributions to Si Se Puede! and another Richardson PAC and the awarding of the CDR contract.

In the newest report, Bloomberg quoted DuVal, who is also a member of the Board of Regents of the Arizona higher education system, as saying he didn’t play a role in securing the bond contract for UBS, had not been contacted by federal investigators and had almost no role in the PAC. DuVal said his firm already had a relationship with Richardson’s administration and he “was not called upon to get involved.” Meanwhile, the article states that UBS gave $25,000 to Si Se Puede! in 2004.

Bloomberg, which has now published several major stories related to the federal investigation, continues to put the New Mexico probe in the larger context.

“The New Mexico investigation is part of nationwide efforts by regulators looking into so-called pay-to-play in the $2.7 trillion municipal bond market, where banks earn fees for underwriting bonds that finance roads, sewers and public works,” the Bloomberg article states. “The term refers to banks and advisers who make political contributions or personal gifts to public officials in return for fee-paying financing assignments, a practice that regulations have sought to curb since the 1990s. This decade, law enforcement officials have prosecuted politicians from Philadelphia to Jefferson County, Alabama, for pay-to-play.”