Prior to Patrick Padilla's first term as Bernalillo County Treasurer, investment of county funds was normally handled by the

county investment officer. Although the investment officer was responsible to the treasurer, the treasurer was normally not involved in day to day investment decisions. State law and regulations governed the types of investments that could be made with county and other government funds. During Patrick's first term, the investment officer made several bond purchases for which the county did not have sufficient funds. He had over committed the county by more than seventy million dollars, $70,000,000.00. The first payment due for the bond purchases was eighteen million dollars $18,000,000.00. To meet that obligation Patrick began liquidating assets, such as CD's, and with assistance from various investment advisors, public and private, Patrick developed some innovative short term investment strategies that would raise the additional funds needed in time to meet the unfunded obligations. Raising the funds was critical to save the county's bond rating. Part of this strategy involved short term investing of county funds in investment vehicles that took advantage of fluctuations in Government backed

securities and deposits. Patrick believed these investments, though complex, were legal and would assist in raising the necessary funds. Bottom line was the county had to come up with $70 million in a short time and Patrick did it. An independent CPA, on contract for the annual audit of the treasurer's office, reviewed some of these new investments and made a finding that the investments were not lawful and was very critical of all the short term activity, clearly the CPA didn't understand the problem or the investments. The auditor's findings were turned over to the District Attorney and Patrick was accused of unlawfully investing County funds. The findings were not correct but the damage to Patrick was done. Patrick received massive negative publicity and lost his bid for reelection. The truth was that the investments in question were both legal and very successful, Patrick's decisive actions and innovative investment strategy had raised the necessary funds and saved the County's bond rating. Instead of being praised for his actions he was accused of being a criminal and run out of office, all as

the result of an audit by an individual who had insufficient knowledge as to the propriety of the short term activities and complex investment strategies employed by Patrick. Patrick was aquited on the criminal charges and Patrick filed a civil law suit against the auditor which was settled to Patrick's satisfaction. The terms of the settlement were confidential. Many of Patrick's then innovative investments are now commonly used by those tasked with investing government funds. Bernalillo County is one of only some 30 counties in the country to have a triple A bond rating. I am a retired attorney who represented Patrick in his civil suit and I hope the truth will prevail .