November 19, 2015

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RGA, Meet FBI: GOP Govs Appoint New Leader Tied to Federal Investigation

New RGA Chair Susana Martinez is the latest in parade of RGA chairs connected to FBI investigations

Today, the Republican Governors Association named New Mexico Governor Susana Martinez as Chair of the organization, making her the latest in a long line of troubled leadership. The announcement comes despite reports this month of an active FBI investigation into her political machine.

Earlier this month, the Santa Fe New Mexican reported that the FBI is investigating Martinez’ fundraising activities, including the transfer of funds from her campaigns to shell companies connected to Jay McCleskey, a top political consultant. McCleskey – Martinez top aide – has previously consulted for the RGA, and has a list of clients that include New Mexico Secretary of State Diana Duran, who recently resigned after pleading guilty to embezzling campaign donations.

“It’s shocking the RGA would nominate a chair just weeks after learning about an ongoing FBI investigation into her political operation,” said Jared Leopold, DGA communications director. “Susana Martinez campaigned on creating jobs and ending corruption, yet she has driven New Mexico’s economy into the ditch and is now linked to a federal investigation. We welcome Governor Martinez into this new role, and look forward to discussing the FBI investigation everywhere she campaigns in 2016.” 

Martinez takes the helm of the RGA from Tennessee Governor Bill Haslam  whose family-owned company was subject to a FBI fraud investigation in 2013, and is the newest addition to the lengthy roster of RGA leaders plagued by federal investigations including:

  • Former RGA Chair Chris Christie, facing an ongoing federal investigation into allegations of abuse of power over his Administration’s involvement in the “Bridge Gate” scandal.
  • Former RGA Chair Bob McDonnell, who has been found guilty on 11 counts of corruption and awaiting the start of his prison term.
  • Former RGA Chair Rick Perry has been indicted for allegedly abusing his power as governor to undermine Texas’ political ethics agency. 

New Mexico’s economic problems also make Martinez an interesting choice as chair. New Mexico’s economy has tanked under Martinez’ leadership, with the slowest employment growth in the nation over the last five years. Forbes has ranked New Mexico the 47th worst state for business. 

BACKGROUND:

  • Recently, the FBI Has Been Interviewing State Republicans About Gov. Susana Martinez’s Fundraising Activities and Payments to Political Consultant and Confidant Jay McCleskey. According to the New Mexican, “For the past several months, the FBI has been interviewing some state Republicans about Gov. Susana Martinez’s fundraising activities going back to her first run for governor. One prominent New Mexico Republican, who spoke on the condition of anonymity, confirmed being interviewed in recent months by federal agents about funds from Martinez’s campaign, as well as money from her 2011 inauguration committee, going to the governor’s political consultant, Jay McCleskey. This person also said agents asked questions about different ‘fundraising vehicles,’ such as political action committees, used by Martinez’s political wing, though it was unclear what potential violations federal agents are investigating.” [New Mexican, 11/10/15]
  • New Mexican Reported “The Probe Could Have Far-Reaching Repercussions, as Martinez is Expected to Be Announced as the Chairwoman of the Republican Governors Association Later This Month.” According to the New Mexican, “The probe could have far-reaching repercussions, as Martinez is expected to be announced as the chairwoman of the Republican Governors Association later this month.” [New Mexican, 11/10/15
  • McCleskey Has Been Martinez’s Political Consultant Since Her First Gubernatorial Campaign in 2009 and is “One of the Best-Paid Political Consultants the State Has Ever Known.” According to the New Mexican, “McCleskey has been Martinez’s political consultant since she launched her first gubernatorial campaign in 2009, guiding her to decisive victories, first in the 2010 Republican primary, then the 2010 and 2014 general elections. […] After Martinez took office, McCleskey started his own firm, McCleskey Media Strategies. He is one of the best-paid political consultants the state has ever known. According to the most recent campaign finance reports, filed last month, Martinez’s political action committee paid McCleskey $128,512 between April and October, an average of $21,418 a month. During that period, Susana PAC paid $20,000 to the polling company Public Opinion Strategies, in which McCleskey’s wife, Nicole McCleskey, is a partner. McCleskey’s company also was paid more than $32,000 for that six-month period — $5,333 a month — by Advance New Mexico Now, another PAC, which raises money for GOP legislative and statewide candidates.” [New Mexican, 11/10/15]
  • The RGA Paid McCleskey was Paid Tens of Thousands of Dollars. According to the New Mexican, “He also was paid by the Republican Governors Association as a consultant for gubernatorial races in Arizona and Nevada. McCleskey received tens of thousands of dollars from the association in 2014.” [New Mexican, 11/10/15]
  • McCleskey’s Clients Included Sec. of State Diana Duran who Recently Resigned After Pleading Guilty to Embezzling Campaign Donations. According to the New Mexican, “McCleskey’s clients have included top Republicans across the state, including Dianna Duran, who last month resigned as secretary of state after pleading guilty to six counts that involved embezzling campaign donations by transferring funds to her personal bank account while making cash withdrawals at casinos.” [New Mexican, 11/10/15]
  • In a Possibly Separate Investigation, Since Early 2013 FBI Agents Have Been Looking Into a Racino License Approved by the Martinez Administration with McCleskey’s Involvement. “FBI agents had been asking questions about a lease extension issued by Martinez’s administration to The Downs Racetrack & Casino in Albuquerque since at least early 2013, though it’s unclear whether that inquiry is related to the present one. That was when a federal grand jury indicted Jamie Estrada, Martinez’s former campaign manager, for unlawfully intercepting emails sent to her campaign accounts. But before he pleaded guilty, Estrada mounted a defense that asserted that the emails’ contents — which include examples of McCleskey’s involvement in state business — showed ‘potentially corrupt conduct.’ Estrada filed a request for ‘all documents regarding possible illegal or improper conduct’ by McCleskey and others.” [New Mexican, 11/10/15]
  • Martinez’ Campaign Manager Pleaded Guilty to Intercepting Emails and Served Time. According to the New Mexican, “Federal prosecutors fought Estrada’s discovery efforts, and he pleaded guilty. But the prosecutors, in fighting discovery, declined to specifically deny that there was an investigation into the racino contract. Estrada recently was released from federal prison after serving time for his convictions.” [New Mexican, 11/10/15]
  • New Mexican: “Federal Investigators Have Subpoenaed Records from the New Mexico Taxation and Revenue Department Looking Into Whether the Agency Performed Retaliatory Audits on Former Members of Gov. Susana Martinez’s Political Team or State Officials Who Ran Afoul of Her Administration.” According to the New Mexican, “Federal investigators have subpoenaed records from the New Mexico Taxation and Revenue Department looking into whether the agency performed retaliatory audits on former members of Gov. Susana Martinez’s political team or state officials who ran afoul of her administration, according to a person familiar with the investigation. It is unclear whether the probe is in any way linked to a simultaneous federal inquiry into Martinez’s top political adviser, Jay McCleskey. Three former Martinez administration officials and a former fundraiser for the governor confirmed in separate interviews with The New Mexican over the last several months that they were audited by the state following public and acrimonious splits with the administration.” [New Mexican, 11/14/15]

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