Hearings To Start on Banking Commissioner’s Job

On a regular basis, the Daily Update will follow up on earlier posts to concisely explain what happened and what’s happening next. Here are two updates, both connected to the continued fallout from the investment Ponzi scheme run by a Meredith mortgage firm that was closed in November 2009.

Banking Commissioner

After months of talking about it, the Executive Council and Gov. John Lynch will begin hearings on Nov. 29 to decide the fate of Banking Commissioner Peter Hidlreth. The five-member council and Lynch met in a special Columbus Day session Monday (Oct. 11). They considered whether or not to hold hearings, which could result in firing Hildreth. He’s accused of not providing adequate oversight to safeguard the public from Financial Resource Mortgage, despite numerous consumer complaints.

Lynch asked for Hildreth’s resignation earlier this year following the Attorney General’s report in May that faulted Hidlreth’s department, the Attorney General’s office and the Securities Bureau for poor handling of the FRM matter. Hildreth did not resign and is on paid leave. Lynch cannot fire him without Executive Council approval, and getting that can be a lengthy process.

The Executive Council first asked for a “petition for removal” in June. Petition complete, the council voted unanimously Monday to move ahead with the hearings where Hildreth will have the opportunity to defend himself. Hildreth was appointed in 2001 by then-Gov. Jeanne Shaheen and reappointed in 2007 by Lynch.

In particular, the 10-page petition said that despite warning signs in audits of FRM and from consumer complaints, Hildreth did not “take further investigative and regulatory steps to safeguard the public, (and) the Bank Department failed to take adequate measures to ensure that FRM conducted its business in a manner compliant with the public interest and with state and federal laws and regulations.’’

The council will act as judge and jury in the hearings, after which the council will reinstate, reprimand or remove Hildreth from his job.

Legislative Committee

The Joint Legislative Committee to Review the State’s Regulatory Oversight of Financial Resources Mortgage met Tuesday to review public comments from the 84-page draft report it released Aug. 31. The report included an investigation of the regulatory structures that led to the lack of clear oversight of FRM and made recommendations for lawmakers to modernize and strengthen regulations to protect future investors.

It’s not known when the bipartisan panel will meet next, but it needs to have a its final report completed and issued by 10 a.m. on Dec. 1. That’s when the committee’s term of service expires and the 2011-2012 Legislature will be sworn in.

Posted by Hilary Niles on Oct 15 2010. Filed under agencies & departments, banking & lending, Commerce, executive council, Government, Justice, Money, securities & investments, Weekly Briefing, white collar crime. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry