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Regulator: 'Catastrophic' failure of NMFA controls

SANTA FE, N.M. -- The state's top securities regulator says a fake audit at the New Mexico Finance Authority went undetected for months and was distributed to investors because of a complete breakdown of the agency's management and oversight.

Securities Division Director Daniel Tanaka told a legislative committee Thursday the release of the audit with misleading financial information was a "catastrophic systemic failure in the controls surrounding the audit progress.

NMFA ex-controller Greg Campbell has been indicted for securities fraud and forgery, but a legislator complained that no other executives are facing criminal charges. A grand jury declined to indict the authority's chief operating officer.

Rep. Sheryl Williams Stapleton, an Albuquerque Democrat, said that "the brother has taken the hit for everyone above him and I think that is so unfair."

Campbell is black.