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Tax Secretary Demesia Padilla Resigns

Tax Secretary Demesia Padilla Resigns

The warrant, which was filed in State District Court in Sandoval County, said that of the $128,763 in income that Padilla might not have reported, $47,753 came from QC Holdings, which “appears to be a short-term lending institution, catering to individuals needing income to sustain until their next paycheck.”

Search Warrant Says Padilla And Hubby Might Have Dodged Taxes

Padilla Allegedly Siphoned $25,000 From Former Client’s Accounts

Unreported Income From a Payday Lender

BY DENNIS DOMRZALSKI

New Mexico Taxation and Revenue Secretary Demesia Padilla resigned Thursday, the day after the state Attorney General’s office filed a search warrant alleging that she and her husband embezzled more than $50,000 from one of Padilla’s former clients, and that Padilla might not have reported $128,000 in income in addition to her state salary.

The warrant also alleged that Padilla, who has been a cabinet member since 2011, did work for the former client up until 2013 and didn’t report either the income or the work on her financial disclosure statement as required by state law.

The warrant, which was filed in State District Court in Sandoval County, said that of the $128,763 in income that Padilla might not have reported, $47,753 came from QC Holdings, which “appears to be a short-term lending institution, catering to individuals needing income to sustain until their next paycheck.”

The warrant said the AG’s office is seeking the state income tax returns for Padilla and her former accounting firm, Padilla & Garcia; the tax returns of the former client, Harold’s Grading & Trucking; and the tax returns of Padilla’s husband, Jessie Medina Jr.

Gov. Susana Martinez said Padilla resigned today.

“As a former prosecutor, I take any allegations of misconduct seriously and don’t believe anyone is above the law,” Martinez said in a written statement. “That is why I ordered the tax department to fully cooperate with the Attorney General’s Office during the course of their investigation. New Mexico faces pressing issues — particularly with our budget — and that must continue to be our focus as we move forward, which is why I accepted her resignation and will quickly appoint a new secretary.”

The investigation into Padilla’s finances began in the summer of 2015 when State Auditor Tim Keller said a preliminary probe by his office was focused on whether Padilla pressured Tax and Revenue employees to give preferential treatment to one of Padilla’s former clients. That information was turned over to Attorney General Hector Balderas’ office.

According to the warrant, there were 38 transactions totaling $25,360 that went from the bank account of Harold’s Grading & Trucking into a Chase EPAY account between Dec. 11, 2011 and Jan. 31, 2013. The automated transfers weren’t authorized by any of the trucking company’s employees, the warrant said.

In addition, between January of 2009 through January 2013, 12 checks and 32 automated transactions totaling $32,636 went from the trucking company’s account to Padilla’s husband, the warrant said. Those transfers also weren’t authorized by the trucking company, the warrant said.

Padilla’s attorney, Paul Kennedy, was not immediately available for comment.

The warrant said that an employee of the trucking firm started looking into the company’s problems in February 2013 after some of the company’s payroll accounts bounced. The employee “noticed numerous payments were made electronically to a Chase account appearing on the statements as ‘CHASE EPAY,” the warrant said. The employee “stated that she knew Harold’s Grading & Trucking did not have a Chase account at the time. She [the employee] stated she later learned the Chase account belonged to either Demesia Padilla or her husband.”

Investigators later learned that the Chase account belonged to Padilla, the warrant said.

Trucking company manager Jonathan Dominguez told investigators that “he was furious upon learning about the unauthorized transfer of money from the business account to the Chase account,” the warrant said, while adding, “During his interview he stated he believes Demesia took money from the company bank account without anyone knowing or allowing her to do so.”

Investigators also discovered that during a two-year period, “approximately $128,763 of unexplained income” was deposited into Padilla’s account at Kirtland Federal Union. That income “did not include her salary as the State of New Mexico Cabinet Secretary for the Taxation and Revenue Department,” the warrant said.

“Evidence of criminal activity, either the failure to properly report income on the Financial Disclosure Statement and/or potential tax evasion or similar crimes, will be held within the tax returns filed by Demesia Padilla.”

 

 

 

 

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Dennis Domrzalski is managing editor of ABQ Free Press. Reach him at dennis@freeabq.com.
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  • Anonymous
    December 15, 2016, 8:11 pm

    Did the Governor obstruct the investigation?

    When these allegations came out last year Martinez’s said this: We believe these are nothing more than unsubstantiated claims that are being driven by disgruntled former employees, who either work for the State Auditor or were fired for sexual harassment.

    Today she says this: As a former prosecutor, I take any allegations of misconduct seriously and don’t believe anyone is above the law. That is why I ordered the tax department to fully cooperate with the Attorney General’s Office during the course of their investigation.

    REPLY
  • Anonymous
    December 16, 2016, 4:41 am

    Yesterday’s resignation of Governor Martinez’s Tax and Revenue Cabinet Secretary should raise new questions in the FBI’s investigation as to why tax audits skyrocketed from 666 in 2011 to 18,000 in 2015.

    Did Governor Martinez collude with Demesia Padilla and use tax audits as retaliation against her political foes?

    http://nmpoliticalreport.com/19144/report-fbi-looking-into-tax-and-rev-audits/

    REPLY
The following two tabs change content below.
Dennis Domrzalski is managing editor of ABQ Free Press. Reach him at dennis@freeabq.com.