There has been a movement over several decades to privatize core government functions. Private prisons come to mind. Turning incarcerating people into a business model. The results have been predictable and tragic.
Less known is that the same trend is happening in attorney general offices across the country. “Outsourcing” public cases to private lawyers is increasingly the norm. As a direct result of this effort, the New Mexico AG’s office is losing its unique and institutional ability to protect and promote the interests of New Mexico citizens.
The AG has, for a variety of reasons, seen an erosion in the in-house expertise it needs to prosecute or oversee cases on behalf of the public. Let’s look at just three areas: consumer litigation, water rights adjudication and Medicaid fraud.
With respect to consumer litigation, the AG’s office is aggressively moving in the direction of hiring outside counsel instead of developing in-house expertise. This creates several problems, not the least of which is the outside attorneys hired by the AG have a purpose beyond representing the state of New Mexico: namely, getting paid. The outside law firm is put in a position of weighing its own financial interests against the protection of New Mexico citizens.
If the AG’s office handled most of these cases in-house, as it has aggressively done in the past, the sole focus would be the welfare of the citizens of New Mexico. The effect of exporting legal expertise was dramatically evidenced in the Vivint case, where the AG declared victory after the outside lawyers were paid, documents were removed from public review, the Consumer Settlement Fund received money, and yet no money went to the affected consumers. They are now on their own to try to get their own justice.
The AG’s office has argued it is hiring outside firms to go after the “big fish.” It does not help New Mexico consumers to go after big fish when the focus is not on getting recovery to the consumer but on paying outside lawyers. And it encourages the public’s perception that some of these outside lawyers either have close ties with the AG’s office or have provided campaign contributions.
On water litigation, for the period July 1, 2019, to June 30, 2020, the AG’s office sought $1.1 million for a no-bid contract for one outside law firm. The AG told the Legislative Finance Committee that the outside law firm receiving the money had the only lawyers in the country capable of handling the litigation — a claim that turned out to be manifestly untrue. The focus was not on New Mexico’s interests but the private firm’s interest.
The lack of regard for institutional knowledge has manifested itself in other ways. In the years 2017-19, our AG’s Medicaid Fraud Control Unit has had the fewest total criminal indictments, fraud convictions or recoveries of all similarly sized units in the country. The reviewing agency found the reason for the poor performance was simple: lack of institutional expertise.
The office had 27 staff departures and 27 hires, with only six staff remaining consistent over the three-year review period. The report dramatically demonstrates what happens when developing and keeping in-house expertise is disregarded or ignored.
I am an attorney and a legislator. I do not want or seek these types of contracts or cases. I do not handle the type of consumer litigation that comes before the AG’s office nor do I intend to. But this is a growing problem that is right in front of us. With each passing year, the problem seems to become worse.
For that reason, I plan to introduce a constitutional amendment that will set up a Department of Consumer Affairs within our executive branch to ensure the interests of the public will be paramount and will restrict this outsourcing of core public functions.