Feds: Investment figure ran Ponzi scam

ALBUQUERQUE (KRQE) - Federal prosecutors accuse investment banker Hassan Nemazee of being a miniature version of swindler Bernard Madoff, but in political circles Nemazee was a giant.

He gave tens of thousands of dollars to prominent Democrats including thousands to Gov. Bill Richardson's campaign committees.

Prosecutors say Nemazee, like the imprisoned Madoff, ran a Ponzi scheme using money from new investors to pay purported dividends to earlier ones. Madoff's scheme reached into the billions while Nemazee is alleged to have scammed $292 million.

KRQE News 13 has learned Nemazee owns part of a company--Carret Asset Management--that has a big contract with the New Mexico State Investment Council.

Since 2007 the state reportedly paid Carret $1.7 million to manage $200 million of public money.

Before being arrested in August and indicted in September Hassan Nemazee was big time. He was a national finance chair for Hillary Clinton's presidential run.

Nemazee also gave thousands of dollars to Barack Obama, Bill Clinton, and Joe Biden.

In a YouTube.com clip recorded years ago from CSPAN, Nemazee introduces then Sen. Biden at a forum on Iran.

"I am fortunate to count him as a personal friend," said Nemazee. Biden's personal friend is accused of conning banks out of $292 million.

In 2006, Nemazee donated thousands of dollars to Richardson committees. Shortly after those contributions the Carret company of New York landed a $200 million deal with the State Investment Council.

Late last year Nemazee, his wife and his business partner gave thousands to Richardson's failed presidential campaign. Forbes Magazine puts the total at roughly $30,000 and also quoted Nemazee's lawyer as declining comment.

An SIC spokesman said Richardson appointee Gary Bland made the decision to hire Carret. Bland stepped down as the State Investment Officer last month amid a separate federal pay-to-play probe.

According to Forbes, Nemazee was co-chair of the firm, but the SIC spokesman said a review launched after Nemazee's arrest found he had no operational control of the company. Thd spokesman says the status of all equity managers working with New Mexico remains under review.

News 13 was unable to reach Bland for comment.

Richardson's office said the governor had nothing to do with hiring the company. However a spokesperson declined to answer News 13 questions about whether Richardson returned any of Nemazee's campaign contributions.