Hildreth Removal Hearings Begin Monday
The Executive Council hearings to determine the fate of state Banking Commissioner Peter Hildreth will go ahead as scheduled on Monday morning. A Merrimack County Superior Court judge on Wednesday rejected Hildreth’s motion to delay the proceedings (see the Union Leader Story here).
Hildreth is accused of failing to act against Financial Resources Mortgage of Meredith. According to federal and state investigators, FRM ran an $80 million Ponzi scheme for almost a decade before the company collapsed in November 2009. As many as 150 investors and private lenders were defrauded out of more than $30 million. On Oct. 6, Gov. John Lynch and the five-member Executive Council approved a petition of removal against Hildreth.
The hearings are set to begin at 8 a.m. Monday in Room 306 of the Legislative Office Building. It’s uncertain how long they could last, especially given that Hildreth’s lawyer has an extensive witness list. A Lynch spokesman said Tuesday that “additional hearings will be scheduled throughout the week as needed.” In other words, don’t expect a quick process.
FRM Committee Completes Work
Speaking of FRM, the joint House and Senate legislative committee investigating the scandal and the state’s regulatory structure for securities and investments has had its final meeting and issued its final 100-page report of findings and recommendations for future legislative action.
“This provides a roadmap with policy options for the next legislature to consider to better protect lenders and investors going forward,” said Sen. Maggie Hassan (D-Exeter), who served as co-chair of the committee with Rep. Ed Butler (D-Hart’s Location).
The draft report recommends changes to the state’s consumer protection laws, clearer jurisdiction for the state’s banking and securities regulators and better inter-agency communication to protect investors, lenders and consumers. It also recommends that private citizens be provided with more options to resolve complaints when they believe that regulators have failed to act promptly or appropriately.
“The challenge for the Legislature will be to enact reforms to ensure that regulators will detect fraudulent business conduct quickly and will have the authority, the tools, the mandate and the resources to limit exposure of the public to such behavior,” the report reads.
“This is one piece of a very large puzzle and we understand that the next Legislature will look not only at this report but at any new information that comes forward,” Butler said.
But, as Front Door Politics suggested earlier this week, taking the recommended actions may prove easier said than done. Committee member and incoming Senate President Peter Bragdon (R-Milford) said “some of these recommendations can be easily addressed, but others are more philosophical and will take longer.”
The 25-member joint committee, made up of the House and Senate Commerce committees, was created in the spring following requests by those defrauded by FRM. The legislative investigation was also sought by lawmakers such as Rep. Jim Splaine (D-Portsmouth) who were skeptical that executive branch investigations into the scandal would be thorough and complete. Since May, the committee took testimony from many state agencies such as banking securities and the attorney general’s office, as well as members of the public who ere defrauded.
You can hear an audio transcript of the committee’s final meeting on Nov. 23 here.
Come Back Monday
The State House is closed today for the Thanksgiving holiday weekend.
This Daily Update was written by Michael McCord.