Six defendants dropped from pay-to-play suit

Marc Correra, center, in 2009. New Mexican file photo

A New Mexico District Court judge on Friday dropped several individual defendants from a lawsuit stemming from state pay-to-play investment scandals that date back to former Gov. Bill Richardson’s administration.

However, the Texas company that employed them and two principals in the firm still are on the hook.

The case, filed earlier this year by the State Investment Council, involves HM Investment Partners of Dallas. In 2007, the council invested $30 million with HM. That investment, according to court records, eventually cost the state more than $2.6 million.

The case is one of three pending lawsuits the State Investment Council has filed over bad investments involving politically connected placement agent Marc Correra, who shared in more than $22 million from investment firms doing business with the state during the Richardson years. Correra’s father, Anthony Correra, was a Richardson fundraiser and confidant. Marc Correra is described in court documents as Richardson’s “de facto gatekeeper for certain investments at the [State Investment Council], including private equity funds.” Both Correras are named in another pending suit filed more than seven years ago.

HM signed an agreement to have a company represented by Marc Correra introduce its agents to potential investors. But the lawsuit says HM “did not need an introduction to [the State Investment Council], as it is a public agency.”

The company knowingly agreed to pay Correra as a condition to obtaining an investment, the complaint says.

“Defendants understood they had to ‘pay to play’ because they knew or should have known that there was no legitimate reason to pay Marc Correra,” the council says in the suit. “They knew or should have known they were participating in a fraudulent scheme, even if they did not know all the details of the scheme or the identities of everyone involved.”

Judge Francis Mathew, in the First District Court in Santa Fe, on Friday agreed with lawyers for the defendants that six HM employees who had been named in the suit should be dismissed.

Charles Wollmann, a spokesman for the State Investment Council, said the judge dismissed those people “without prejudice,” which means they could face the allegations in a new suit.

“Additional evidence in discovery could bring those defendants back into the case,” Wollmann said, “once we establish they, as individuals, were compensated financially for the New Mexico investment.”

But Mathew refused to dismiss two defendants: John Muse, a founder and principal of HM, and Joseph Colonetta, a principal who in 2007 gave presentations on HM to the State Investment Council and the council’s Private Equity Investment Advisory Committee.

The State Investment Council also is pursuing a case filed in 2011 against Anthony and Marc Correra, former State Investment Officer Gary Bland — who was hired by Richardson at the recommendation of Anthony Correra — and Guy Riordan, a Richardson friend who was banned from the securities industry in 2009.

The council filed another suit this year against a Dallas hedge fund management firm called HFV and Clark Hunt, the owner of the Kansas City Chiefs, who the council claims secured $300 million in state investments by using the Correras’ influence with Bland.

In a separate case, a state district judge in July approved a settlement between the state and a Chicago-based investment firm, Vanderbilt Capital, for $24.25 million. Vanderbilt had lost about $90 million in state funds through bad investments, though a judge did not determine there was evidence the company had committed fraud.

Saul Meyer, who was a partner in Aldus Equity Advisors, which contracted with the State Investment Council during the Richardson years, pleaded guilty in a New York corruption case. In his plea statement, he admitted that he “recommended certain proposed investments that were pushed on me by politically connected individuals in New Mexico.”

“I did this knowing that these politically connected individuals or their associates stood to benefit financially or politically from the investments,” he said, “and that the investments were not necessarily in the best economic interest of New Mexico.”

Later, he implicated the Correras as the “politically connected individuals.”

Contact Steve Terrell at 505-986-3037 or sterrell@sfnewmexica­ Read his blog at

(0) comments

Welcome to the discussion.

Thank you for joining the conversation on 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.