You have permission to edit this article.
Edit
editor's pick top story

Complaint: A story of casinos, campaign money and crime

  • Updated
  • 13
  • 8 min to read
Complaint: Gambling sprees made possible by transfers between Duran’s accounts

Last Dec. 29 should have been a heady time of triumph and celebration for Dianna Duran, who was just three days away from being sworn in for her second term as New Mexico’s secretary of state. Duran, though, had just $2.15 in the personal checking account she shared with her husband, and she had broken the law to get even that much, according to state Attorney General Hector Balderas.

Balderas on Friday charged Duran with 64 counts of embezzlement, fraud, money laundering, identify theft and other crimes. His investigators pointed to Christmastime 2014 as a period when Duran was reeling from overspending and debt, even as she appeared to be at her peak in terms of accomplishment and popularity. Withdrawals by Duran at casinos across the state dwarfed the annual income that she and her husband, Rosaleo “Leo” Barraza, 68, listed in tax returns.

In 2013, withdrawals totaling $147,000 were made at eight different casinos from bank accounts Duran controlled — $10,000 more than the couple’s adjusted gross income that year, according to the complaint. The couple’s income for 2014 was not immediately available, but that year their withdrawals at casinos soared to $282,806.

Taken together, the allegations portray a dizzying pattern of gambling sprees made possible through a series of transfers between bank accounts set up for her 2010 and 2014 campaigns and the personal checking account she shared with her husband that frequently delved deep into the red.

Duran’s banking records, as outlined by Balderas, show a life different from her public image. A conservative Republican in a mostly Democratic state, she rose from a deputy county clerk in Southern New Mexico to become the second-highest-ranking Republican in the state.

She won the secretary of state job in 2010, in part by promising to bring order to an office that had been rocked by scandals involving her two predecessors. During a hard-fought re-election campaign, she used the slogan “Leadership that’s working.”

But even as she was still enjoying that victory, her sagging personal bank account and spotty campaign finance filings depict a financial picture bordering on chaos, the figures in the complaint show. At the same time, a review of online court records by The New Mexican showed no liens, bankruptcies or other indicators of financial distress.

On Dec. 23, Duran and her husband had overdrawn their personal First National Bank joint checking account by $2,042.56, Balderas says in the criminal complaint. The next day, Christmas Eve, was worse for Duran. In five transactions, she spent another $3,126 from an account already in the red. That meant she was overdrawn by a total of $5,169.19.

Duran, 60, followed with a flurry of financial maneuvering. On Dec. 26, a direct deposit from “the state of New Mexico” was made into her checking account, but she also had three more debits, Balderas’ investigators wrote in the criminal complaint. She was in the hole $3,921.17.

Then came Dec. 29. She deposited $4,660 into the account. Most of it was cash. But she also included a $500 check from lobbyists Marla Shoats and Dan Weaks. Shoats and Weaks had listed the purpose of the check as a campaign contribution, not a gift or personal loan. With those deposits, Duran had the account in the black again, but Balderas said it was one of many examples of her illicitly using campaign funds for her personal benefit. An examination of Duran’s campaign records by The New Mexican confirmed the $500 check was never reported in filings for her 2014 campaign. It was one of 18 checks from contributors over a two-year period, totaling more than $4,300, that were never reported in campaign filings, as required by the very campaign finance law Duran is charged with enforcing.

After paying overdraft fees and the state’s gross receipts tax, and withdrawing another $700 at the Sandia Resort & Casino north of Albuquerque, Duran ended the day with the balance of $2.15 in her checking account. Her salary as secretary of state is $85,000 a year.

Duran could not be reached for comment Saturday. Her lawyer, Erlinda Johnson, said in an email Saturday, “We continue to conduct our legal research into the propriety of the investigative methods used in this case. We have grave concerns that the AG’s office may have abused the grand jury process during their investigation. We will file the appropriate motions to dismiss with the Court once our research and analysis is completed.”

Deborah Maestas, chairwoman of the Republican Party of New Mexico, said in a statement Saturday, “We respect Dianna Duran and her legal team’s rights to present the facts and defend these allegations.” Maestas added, however, that “if allegations are true she needs to be fully accountable under the law. The Attorney General must hold elected officials of both parties to the same legal and ethical standards without partisan bias.”

• • •

Duran is the second secretary of state in New Mexico to face criminal charges. In 2009, then-Attorney General Gary King charged Rebecca Vigil-Giron, a Democrat who had left office at the end of 2006, with 50 criminal counts related to the misuse of federal money earmarked for a voter-education campaign. The charges included fraud, embezzlement and money laundering. Her case lingered for years in state courts.

The U.S. attorney, New Mexico’s top federal prosecutor, eventually charged Vigil-Giron’s co-defendants, political consultant Armando Gutierrez and lobbyists Joseph and Daisy Kupfer. But the federal government never charged Vigil-Giron.

Gutierrez and the Kupfers were convicted on federal charges. A state district judge dismissed the charges against Vigil-Giron in 2012, saying more than three years of delays in the case were caused by the prosecution.

Duran, a native of Tularosa, worked in the office of the Otero County clerk for more than 20 years, starting in 1979. During that time, she twice was elected as county clerk, serving two-year terms from 1988 to 1992. For most of the other years, she was a deputy clerk.

In 1992, her last year as county clerk, Duran was elected to a state Senate seat. She rarely, if ever, broke from her Republican colleagues on major issues. As a senator, Duran consistently voted for gun rights, longer sentences for criminals and anti-abortion legislation. She opposed higher taxes, gay rights and liberalizing drug laws.

Duran eventually was elected Republican caucus chairwoman in the Senate. In 2001, she introduced a bill that didn’t make it far in the Legislature but would become her signature issue for the rest of her Senate career and for her tenure as secretary of state. She wanted photo identification to be a requirement to vote.

As a former county clerk, Duran said, in-person voting fraud was a problem or potential problem. She said mandating photo identification was the best way to curtail fraud at the polls. Her bills and similar ones by other Republican legislators were defeated by Democrats, who said most voter fraud could be linked to mail-in ballots while Duran was focused on in-person voters.

• • •

In 1998, Duran ran her first race for secretary of state. She lost to Democrat Vigil-Giron.

But in 2010, conditions were more ripe for a Republican victory in that race. Not only was that a GOP “wave” year nationwide, incumbent Secretary of State Mary Herrera, a Democrat, seemed to be ensnared in one controversy after another, mostly having to do with conflicts with her own staff. Some alleged Herrera was doing campaign work from the office.

Herrera fired top staffers after they talked to reporters. She also quarreled with county clerks around the state, including fellow Democrats. In the 2010 election, Duran received support from six Democratic county clerks, including then-Santa Fe County Clerk Valerie Espinoza. (Espinoza endorsed Democrat Maggie Toulouse Oliver instead of Duran last year).

With her victory in 2010, Duran became the first Republican elected as New Mexico secretary of state since 1928. She was the GOP’s top vote-getter — even ahead of Gov. Susana Martinez, who was elected to her first term that year.

Despite winning bipartisan support in that election, soon after taking office, Duran’s fierce dedication to voter identification alienated many Democrats.

During the 2011 legislative session, Duran testified in favor of a voter ID bill in a committee and raised allegations of voter fraud against unidentified immigrants.

She claimed her office had cross-checked voter registrations with a state Motor Vehicle Division database, and had found 117 foreign nationals who had registered to vote. All of these, she said, had listed Social Security numbers on voter registration forms that didn’t match their names. At least 37 of those actually voted in state elections, Duran said.

Later that year, Duran turned over about 64,000 voter registration records to the State Department of Public Safety for investigation of what she called possible voter fraud. That was more than 10 percent of the 607,700 people who voted in the state in the previous general election.

Duran said at the time that she didn’t consider all 64,000 cases to be potential voter fraud cases. “I’m just trying to assure the accuracy of our voter files,” she told The New Mexican.

The American Civil Liberties Union sued Duran, saying she had made claims that she could not back up and then tried to hide information from public view.

No charges of voter fraud ever came out of files she turned over to the Department of Public Safety.

• • •

One of the attorney general’s charges against Duran dates to March 2010, when she issued a $600 check from her campaign account with Wells Fargo Bank to Sean Davis for “equipment & work on campaign.” But the check, signed by Duran and supposedly endorsed by Davis, was deposited in Duran’s personal checking account.

Davis, who is from Duran’s hometown of Tularosa, told Balderas’ investigators that he never worked on Duran’s campaign and that he did not receive any payment from her for campaign work. He also said he did not endorse the check, though his name appears on it.

In her campaign expenses for her re-election in 2014, Duran listed $3,177.27 in payments to her husband. She said the money was reimbursement for travel, supplies and a parade. But a check for $2,850 issued on Nov. 20 to her husband was not included in that total and was never recorded in campaign filings, according to the complaint.

The same day the check was issued, it was deposited in the couple’s personal account, bringing the balance up to $4,946. Also that day, withdrawals totaling $4,500 were made from the personal account at Sandia Resort & Casino. The casino, under subpoena, later supplied investigators data from Duran’s players club account — a rewards program for frequent gamblers — showing about that same amount of activity that day, according to the complaint.

Oliver, the Bernalillo County clerk who narrowly lost to Duran last year, said in a statement Saturday that she was “shocked and saddened” by the charges against Duran and hopes there is “a swift and fair resolution of this matter.”

She added, “The duties performed by the secretary of state are immensely important to the day-to-day function of our state government, local business operations and election processes. Ensuring accountability and faith in the office that protects our right to vote has to be our highest priority right now.”

• • •

During last year’s campaign, in July 2014 — about the time that a tipster had alerted the Attorney General’s Office that Duran was making some unusual financial transactions involving her personal and campaign bank accounts — Duran tangled with Democratic gubernatorial candidate Gary King, who was the sitting attorney general. Duran said King had received campaign contributions that exceeded the legal limit.

Noting that King had accepted $10,400 from a Taos couple and $5,700 from a Santa Fe retiree after the primary, Duran demanded King give $10,900 in contributions to the state’s public election fund. Under state campaign finance laws, individuals and political action committees can donate up to $5,200 per primary election and another $5,200 per general election to a candidate for statewide office.

King argued the contributions were legal because they are to help retire his primary election debt. He had loaned about $535,000 to his campaign during the primary. After King filed a lawsuit requesting the state Supreme Court settle the dispute, Duran changed her stance and said King could keep the contributions.

But the initial allegations are strikingly similar to one of the charges in Balderas’ complaint against Duran. The complaint accuses Duran of under-reporting campaign contributions from Mack Energy Corp. of Artesia. It contributed a total of $12,700 to Duran’s re-election, but she reported only $10,400 of Mack Energy’s’s donations.

The criminal charge against Duran says Mack Energy on Aug. 22, 2014, contributed $5,200 to Duran’s campaign. “This check was not endorsed,” Balderas’ investigators say in the criminal complaint. But it was deposited in the secretary of state’s account at First National Bank on Sept. 4.

Then Duran filed a campaign report in which she said Mack Energy had donated $2,900 to her, a claim at odds with the fact that the company wrote her a $5,200 check.

Mack C. Chase, founder of Mack Energy, said Saturday he didn’t know anything about the charges against Duran.

He declined to comment further.

• • •

The charges are the latest and most stark development in what had been a deepening divide between Balderas and Duran over campaign finances.

In February, the two announced the formation of a joint task force to look at issues regarding New Mexico’s campaign finance reporting, enforcement, referral process and best practices. Shortly after being sworn into office for their current terms, the two met to discuss how their agencies could work together.

The task force met only twice. In June, Balderas made his own recommendations, which included mandatory fines for late reports. Balderas said he remained concerned about Duran’s efforts to enforce campaign finance laws.

Duran responded by saying that Balderas had been late three times with his own campaign finance reports. Then Duran admitted that she had been wrong, as only one report from Balderas had been late.

Among the 18 checks Balderas lists as contributions to Duran that were never reported in campaign filings was one written on July 17, 2012, by a Republican activist in Albuquerque named Billie Crouse. It was for just $25.

In an interview Saturday, Crouse said she’d been interviewed by an attorney general’s investigator. But she didn’t realize until called by a reporter that her check was part of charges against Duran. Hearing about the accusations “made me sick to my stomach,” she said. “I really like her.”

Criminal complaint and information filings

  

(13) comments

Devin Bent

Gambling is an addiction that destroys many lives. Those newspapers and politicians who rake in money from the casinos should remember this.

Rod Lievano

This is sad all around. But, illness or not, she - or somebody - knew what she was doing.

Let's take a moment to pray for the people of New Mexico.

Larry Davis

Please take a moment to pray for Diane & her family.

Thomas Franks

I just want to add, truly great reporting! I feel sorry for all involved, and I'm not a" bleeding heart liberal: as I'm sure I'll be called (more like a curmudgeon of an independent) but it IS a psychological illness. Yet, of course, one is STILL responsible for one's behavior, and one's destruction of the public trust by such an important individual. It's just as I get older, I just feel an almost Buddhist like compassion for the many ways intelligent and powerful people, who at one time wanted to do some good, self-destruct.

Andrew Lucero

Well, one thing is for sure, Duran has some serious splainin to do! --- Now if we could only get Hector to investigate the missing 30 million from the parks bond with the same vigor, we might get somewhere!

Mike Johnson

[thumbup]

And if only even a single GOP person were involved with that fraud, he would!

James Wilson

In a reality zone, Duran would be facing prison time. But a SF judge recently sentenced a murderer to probation--someone who confessed to emptying a gun into someone. What are the odds? Expect Duran to play the victim--it's a sickness, an addiction. Waah waah, I need help . . . Hello, probation.

Keep smokin' pot, liberals!

Joseph Hempfling

Wonder if She used a State Car to do all her running around between casinos ?? And will
we taxpayers be reimbursed for the milage or as usual, just let it slide ?

Peter Romero

Why won't anyone go after Bill Richadson ? oh I forgot, we can't investigate our own political parties.

Raymond McQueen

But wait!

As a staunch Republican, anchored in family values and leading a self-proclaimed crusade against the potential one case of voter fraud in the state, Secretary of State Duran should be given a pass on this one! Give us all a BREAK!

Prince Michael Jauregui

Congratulations to the entire staff of The SFNM, for a truly prize-worthy piece.


"Money, it's a hit
Don't give me that do goody-good bulls***"
Pink Floyd

Larry Davis

It appears that Diane and / or her husband suffered from a gambling addiction.

James Wilson

All that gambling. And who knows how many trips to the buffet.

Welcome to the discussion.

Thank you for joining the conversation on Santafenewmexican.com. Please familiarize yourself with the community guidelines. Avoid personal attacks: Lively, vigorous conversation is welcomed and encouraged, insults, name-calling and other personal attacks are not. No commercial peddling: Promotions of commercial goods and services are inappropriate to the purposes of this forum and can be removed. Respect copyrights: Post citations to sources appropriate to support your arguments, but refrain from posting entire copyrighted pieces. Be yourself: Accounts suspected of using fake identities can be removed from the forum.

Get up-to-the-minute news sent straight to your device.

Topics

Breaking News

Special Offers & Promotions