Wednesday, October 29, 2008

Cummins Taking Low Road in Campaign Against PRC Chairman Marks.

Yesterday, Tim Cummins’ PRC campaign released a press release and an advertising campaign portraying incumbent Commissioner Jason Marks as a supporter and enabler of disgraced former Insurance Superintendent Eric Serna. After asking Jason Marks to respond we learned the real story.

It is apparent Cummin's charges are half-cocked. The real story shows that Marks took a leadership role in ending Serna’s troubled career in government and cleaning up the PRC’s insurance division. Marks says:
The bottom line is that I did a lot about Eric Serna's corruption, more than anyone else in state government either before or since. (Despite active investigations under 2 AGs and the US Attorney for the past 2.5 years, there has never been an indictment or any report released.)
We just received this information rebuting Cummins' ridiculous news release and attack ads.

Eric Serna served 18 years as a member of the State Corporations Commission (a predecessor to the PRC), during which time he was accused multiple times of misconduct. In 2001, PRC Commissioners appointed Serna to be Superintendent of Insurance.

Marks pushed the investigations that led Serna losing his job. In February 2005, just six weeks after joining the PRC, Marks put a stop to Serna’s practice of taking large contributions from regulated insurers to his Con Alma foundation.[1] One year later, in March 2006, Marks initiated the PRC’s inquiry into a contract between Serna’s Insurance Division and Century Bank. The PRC adopted Marks’ proposal that the Insurance Division be ordered to rescind an illegal contract amendment that had increased Century’s fees.[2] On March 21, 2006, Marks joined a PRC majority in asking Attorney General Patricia Madrid to review the Century Bank contract.[3] Contrary to the implication of Cummins’ release, Marks and the PRC were responsible for the AG’s investigation, not the other way around. On May 18, 2006, Eric Serna’s long and troubled career in state government ended when he agreed to leave his position under pressure from Marks and a majority of his colleagues on the PRC.

Did Jason Marks support retirement benefits for Eric Serna? No. Marks, along with a majority of the PRC, supported allowing Serna to call his departure a “retirement.” Nothing the PRC could have done would have affected Serna’s ability to draw retirement benefits from PERA (other than refer information to law enforcement for possible criminal prosecution, which the PRC did do).

Why did Marks agree to Serna’s “retirement”? Serna was protected by state statute from dismissal without cause. The improper termination of Serna’s predecessor in 2001 had cost taxpayers a half-million dollar settlement. The PRC received no information from the Attorney General about any findings from her investigation that would have supported firing Serna, if he had chosen to contest the firing in court. Under the circumstances, Marks decided to support an immediate end to the Serna controversy that got Serna out of his position right away with no risk or cost to the taxpayers. For comparison, the Highland University Regents gave Manny Aragon a six-figure contract buy-out after they dismissed him. Marks said recently: “The controversy was consuming enormous amounts of time and keeping us from focusing on critical telecom and utility cases. With no end in sight to the investigations, the most important thing was to get Serna out of the Superintendent’s position ASAP, and let the professional criminal investigations take their course. Some may say they would have made a different decision under the circumstances, but it’s ridiculous to suggest that my motivations were anything other than doing what I thought was best for the public and the agency.”

Did Attorney General Madrid agree that Marks and the PRC made the right move? Yes. Madrid said “I believe the agreement reached by the PRC and Mr. Serna, which will allow him to retire and have no further contact with the Insurance Division, is an appropriate Action by the PRC.”[4]

Can the press rely on Cummins’ description of the arrest of former Deputy Superintendent Joe Ruiz? No. The Cummins press release says “the deputy superintendent of insurance was arrested on 31 counts of extortion, corruption, mail fraud and wire fraud.” The truth is that the FBI arrested former deputy superintendent Ruiz. Ruiz was a former deputy because, under Marks’ leadership, the PRC had fired him for corruption more than a year before his arrest.

What do others say? “Contrary to the false accusations it was Jason's skillful negotiations, backed by potential votes of PRC commissioners that forced the corrupt former Insurance Superintendent, Eric Serna, and his wayward assistant out of office. As you may recall, Serna's assistant was subsequently prosecuted and convicted of taking kick backs. The Superintendant's position, statutorily, was practically impregnable. Without Jason's skillful negotiations it could have taken another year to remove Eric Serna from office.” Eric S. Jeffries, an Albuquerque attorney who represents consumers against insurance companies and represented Serna’s predecessor in his suit against the PRC.

“I advised the Commission to accept [Serna’s retirement] as the most effective and efficient way to resolve the central personnel issue. I did not believe it would adversely affect the public interest in that the Attorney General’s investigation would continue.” Allen Ferguson, former Associate General Counsel for the PRC and Acting General Counsel at the time of the Serna investigation.

[1] Albuquerque Journal, February 18, 2005.

[2] Albuquerque Journal, March 19, 2006 and March 22, 2006.

[3] Albuquerque Journal, March 22, 2006.

[4] Albuquerque Journal, May 19, 2006.

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