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The problem with Rep. Ben Ray Lujan’s House financial disclosures

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BY CHRIS MANNING
Libertarian Candidate, New Mexico Congressional District 3

For many of you reading this article it will be the first time you’ve ever heard of me. Let me introduce myself, I’m Chris Manning and I’m running for the United States Congress in New Mexico’s CD 3, and I’m a Libertarian, hence why you’ve never heard of me. It’s okay, as the state’s newest major party it will take time before we have grown large enough to warrant the same attention as the Republican and Democrat candidates.

Before we get into the meat of my article let me first tell you about my day job. I’m a staff auditor for my family’s accounting firm. The majority of our business is auditing governmental organizations and non-profits. I’m not a CPA or a CFE, I have a degree in Secondary Education.

I spend most days checking compliance and the internal controls of school districts, non-profits, water companies, and acequias throughout the state. So naturally after I decided to run and secured my name on the ballot I began to examine Congressman Ben Ray Lujan’s House financial disclosures and FEC reports to get a better understanding of how and where his campaign’s money came from, and more importantly how he spent it.

After reviewing the congressman’s public disclosures it is apparent he failed to disclose liabilities and income he was required to disclose from 2008-2012. The congressman took out two loans in 2007-2008 in the amount of $200,000 and he earned more than $30,000 in interest by loaning this money to his campaign. According to Lujan’s FEC records he took out a $50,000 loan from Century Bank Federal Savings Bank, De Vargas branch with a 5 percent interest rate.

In his July 2008 filing Lujan lists a $150,000 loan from Valley National Bank with a 7 percent rate. The Congressman earned a total of $31,423.33 in interest from 2008-2012, yet he never listed this income on his financial disclosures as he is required to do. Additionally, the congressman earned more interest than what the terms of his loan stated he should have received.

On the $150,000 loan his schedule C (FEC Form 3) states he would receive a 7 percent interest rate. Depending on how you amortize the loan it would result in different interest amounts owed to Lujan. I called the FEC information and public records department to request a copy of the loan documents from the bank as is required by FEC guidelines to have been submitted. They advised me that the campaign did not submit those documents.

The congressman’s Schedule C should also have been signed by a representative of the bank to confirm the loan terms on the FEC Form 3 were accurate. There is no signature on the Schedule C making it is impossible to independently verify the accuracy of the congressman’s documents. No matter how you amortize the loan the Congressman collected more than the 7 percent rate listed.

A loan of $150,000 with a one year term and a 7 percent interest rate with monthly payments would total $5,748.14 in interest payments. If you extended the terms to a 42 month loan rather than the 12 months listed in the FEC filings interest payments would total $19,559.47. However, the Congressman received $30,999.71 in interest payments. This means the Congressman realized about a 10.85 percent return over 42 months.

If we assume the interest was compounded monthly and all payments were applied toward accrued interest first, and then to principal based on the dates the actual payments were made, according to his FEC disclosures, the congressman realized more than an 8.66 percent return.

So not only did the congressman fail to disclose both the liability and the interest income, he also collected between $6,000 and $25,000 more in interest than the terms of his loan stipulated. This is fraud funded on the backs of his donors. The interest income was also required to be reported to the IRS. If the congressman failed to report the interest income to the IRS, that could be tax evasion. It is apparent Ben Ray Lujan has been less than honest and forthcoming when filing his house financial statements.

This is why I filed a complaint with the House Ethics Committee to investigate these omissions. I’m calling on the congressman to release his tax returns for every year he has been in office as Sen. Warren has done. The people of this state and the voters deserve to know if the congressman has additional income and liabilities he has failed to disclose. The people of this state deserve an honest representative who will be transparent and forthcoming when it comes to their financial disclosures.