‘N.H. does not need its own Watergate’

The following are excerpts from a letter sent Feb. 22 to House Speaker Terie Norelli by Portsmouth Reps. Jim Splaine and Paul McEachern. We ask you to authorize the House Commerce Committee to begin a formal inquiry into the process of the inner workings of state government that allowed the situation of a Ponzi Scheme relating to Finance Resources Mortgage, Inc., to evolve. As an alternative, we would suggest you create a special bipartisan legislative committee to undertake the inquiry.Of interest to all of us should be how our regulatory system worked or did not, and what statutory changes need to be considered to make sure that all of our citizens are protected …Of special note are developments or comments made since we offered our initial request a week ago that the Legislative Branch undertake an inquiry into the process, and not leave it up to the Executive Branch:• The release of a letter sent to the Attorney General’s Office on June 17th, 2003 by the Bureau of Securities Regulation requesting that the AG “freeze” the assets of Financial Resources Mortgage, Inc. That was positive action by the Securities Bureau seven years ago that if done apparently would have prevented the Ponzi Scheme from evolving to the point that it had last year. There had also been 15 other complaints made about Financial Resources Mortgage, Inc., that were forwarded by the Consumer Protection Bureau to the Banking Department, but went nowhere.• Second is the comment by a member of the Attorney General’s Office, as reported by the New Hampshire Business Review on February 12th, that “…there is not enough of a conflict of interest to warrant a third-party investigation in the matter…” Not “enough of a conflict of interest?” A conflict obviously exists by any read of the information already made publicly available, and that alone is reason for an independent Legislative Branch review, without delay …• Third is the indication that this matter is being investigated either in-house by the Attorney General’s Office, or that an outside “independent” investigator or firm will be reviewing the matter, reporting to the Attorney General’s Office. Worse is a comment by a member of the Attorney General’s Office that their investigation will take “at least” 6-8 weeks. That is an unacceptable delay.IF NOTHING IS DONE THIS LEGISLATIVE SESSION TO ADDRESS THESE CONCERNS, IT WILL NOT BE BEFORE 2011 THAT WE CAN IMPLEMENT STATUTORY REFORM. THAT IS UNFORGIVABLE.• The individual currently slated to head up the investigation from the AG’s office was head of the Consumer Protection Bureau in 2003 and until recently, when these complaints came in … No one should be in the position he is being put in.• In the New Hampshire Business Review story of February 12th, the attorney general is quoted as saying that the state “has not identified anything that would suggest liability, but we are always mindful of that, since one of our responsibilities is to defend the state against such suits.” This statement demonstrates that the Attorney General’s Office simply cannot be impartial in their review …New Hampshire does not need its own episode of Watergate … Sunlight and sunshine on a matter such as this, which goes to the core of trust of state government and the integrity of the process of government, requires the full public’s right-to-know. To do anything else means cover-up, stonewalling, and whitewashing.We cannot allow that to happen.