August 10, 2016

SOS ethics complaint publicizes problems with campaign finance website

In response to allegations of breaking campaign finance laws, Republican Secretary of State candidate Nora Espinoza said her accuser manipulated documents to create false accusations.

State Rep. Nora Espinoza

State Rep. Nora Espinoza

Espinoza sent Secretary of State Brad Winter a four-page letter defending campaign finance reports she filed in 2016. These reports accounted for expenses and donations going back to last year.

Espinoza, however, also accused Robert Lara, who filed the complaint last month, of falsifying documents in an attempt to attack her.

“Mr. Lara created a form of his own design with his own headings and terminology which nowhere appear in statute. Then he created his so-called ‘violations,’” Espinoza, a state lawmaker from Roswell, wrote.

NM Political Report left a phone message with Lara, who didn’t return the call before press time. We’ll add his comments once we receive them.

Lara’s original complaint accused Espinoza of improperly using campaign money to pay off credit card debt, not listing what many of her campaign payments were used for and failing to report an in-kind contribution from Zach Cook, a Roswell attorney and colleague of Espinoza’s in the House.

Lara, for example, said Espinoza’s use of campaign money to reimburse her credit card violated state campaign finance laws. But Espinoza disputed that claim and also accused Lara of citing a different dollar amount than she wrote in her report. Her campaign listed a payment of $122.74 to her credit card in November 2015 while Lara’s complaint noted that the payment totaled $147.

Espinoza says accuser is ‘malicious’

Espinoza maintained that state law does not prohibit reimbursements from campaigns to a respective candidate, which she argued is common practice.

“As just one example, among hundreds, my opponent, Maggie Toulouse Oliver, has used her own personally-operated ‘PAC,’ named MaggiePAC to reimburse herself for expenses incurred,” Espinoza wrote, referring to the political action committee.

Lara alleged that Espinoza failed to report the purpose of the credit card reimbursements. In his complaint, he cited spending from Espinoza’s reports where she left the purpose of that spending blank.

The spending in question that Lara claimed Espinoza didn’t report the purpose of included payments to Hobby Lobby, Southwest Printers, NM Demographic Research and Perez & Associates.

Espinoza, however, disclosed a copy of her report to the Secretary of State that does, indeed,  list the purpose of these four payments.

Espinoza added that the reporting system does not allow that column to be left blank.

Similarly, Lara accused Espinoza of using campaign finance funds for her personal business by listing the purpose of a $89.19 paid to AT&T Services as “business.”

Espinoza’s actual reports show she listed the AT&T expenses as “cell phone service.”

After citing this, Espinoza attacked Lara for “maliciously” erasing information from public records and submitting them as a complaint along with persuading news outlets to publish incorrect information.

“Not only did he do all this for a malicious and unlawful purpose, he immediately provided his fabricated information and the accompanying lies and falsehoods both to an unknowing media, and to his allies in media for the purpose of securing negative publicity for me and my campaign,” Espinoza wrote. “He was successful in securing publication of false reports.”

Lara’s incorrect citation of Espinoza’s finances, however, may have a different explanation.

A ‘glaring hole’ in campaign finance system?

The state’s Campaign Finance Information System’s database, which is available for the public to view online, lists all five payments identically to how Lara reported them in his complaint. But the campaign disclosure forms that Espinoza filled out show the purpose of the payments.


Maggie Toulouse Oliver explains problems with the state campaign finance information system.

Printouts of the campaign disclosure forms are also available online in the state database, though must be downloaded separately from viewing the database.

At a press conference Wednesday afternoon, Democratic Secretary of State candidate Maggie Toulouse Oliver said the discrepancies what political candidates report and what actually shows up in the online public campaign database are significant and “require immediate action.”

“There is a glaring hole in the campaign reporting system,” Toulouse Oliver, who will face off against Espinoza in the November election, said.

Toulouse Oliver added that her press conference wasn’t related to Lara’s complaint and that her campaign “stumbled upon this issue” when doing regular reviews of the state campaign finance system.

Toulouse Oliver called for an investigation of why full information wasn’t going into the state’s online campaign finance database and added that, “we may need to scrap the current system and start over completely.”

At the conference, State Sen. Jerry Ortiz y Pino, D-Albuquerque, highlighted discrepancies in his campaign reports similar to that of Espinoza’s.

“We do need a more transparent system,” he said.

Other accusations

Lara also said in his statement that Espinoza failed to disclose legal work done for her campaign as a contribution. Cook previously filed a complaint against Toulouse Oliver accusing her of failing to report a donation from one PAC to another. Neither PAC is not associated with Toulouse Oliver or her campaign.

Cook told NM Political Report that he filed it in his capacity of a private citizen and lawyer and did not file it on behalf of Espinoza. Espinoza backed up Cook’s claim in her response.

“Mr. Cook has done no legal work for the campaign, and this is obviously a frivolous attack on Mr. Cook, which warrants no further comment,” Espinoza wrote.

At the end of her letter, Espinoza accused Lara of unethical behavior. Lara is the treasurer for the Democratic Party of New Mexico as well as an attorney.

Lara previously told NM Political Report he filed the complaint in an individual capacity.

Espinoza said she forwarded her concerns of Lara’s behavior to the agency that oversees complaints against lawyers.

“My reporting fully complies with both the Act, and the type of reporting conducted by all other candidates who are in compliance with the Act,” Espinoza wrote.

“On the other hand, Mr. Lara has committed multiple violations of the Code of Professional Conduct for attorneys.”

Lara also accused Espinoza of violating campaign finance laws by lumping two donors into one entry. Espinoza countered that those entries were married couples who shared finances and that there is nothing in the law that prohibits it.

“I know of no statutory requirement concerning this, nor of any Administrative Rule that has been adopted,” Espinoza wrote.

NM Political Report tried to contact the Secretary of State’s office for clarification on joint donations. A spokesman for the office said the two experts on the matter were out of the office. We will add their responses when we receive them.

Read Nora Espinoza’s response to the ethics complaint against her below:

Sos Response Lara Complaint by New Mexico Political Report on Scribd