Embattled New Mexico Insurance Superintendent Eric Serna has agreed to retire as part of a settlement approved by the Public Regulation Commission.
Serna, who has been on paid leave since last month, is under investigation by the attorney general for his dealings with a bank that does business with the state Insurance Division.
He will retire as of June 14 and has agreed not to sue the PRC under a settlement that Vice Chairman Jason Marks described as allowing the superintendent to leave “on a dignified note.”
Serna in a letter to the PRC said the “inaccurate rumors, innuendo and speculation” had been disruptive, and he hoped his retirement would allow the division to re-focus on its work.
“The incessant attacks and baseless allegations from those who hope to attain some political gain at my expense is sad and hurtful,” he also wrote.
The mid-June date allows Serna to attend a Washington, D.C., meeting of the National Association of Insurance Commissioners, of which he is secretary-treasurer. No state money would be spent on the trip and he could not vote on substantive issues under the agreement.
Until that time, Serna will be on vacation leave and subject to the same restrictions of his administrative leave: no official actions, no contact with PRC employees and access to his office only to pickup personal belongings.
The attorney general’s investigation will continue, although the PRC will drop its separate internal investigation of Serna.
Attorney General Patricia Madrid said in a statement that Serna’s retirement is “an appropriate action.” She said she didn’t know when her office’s investigation would conclude.
Gov. Bill Richardson said in a statement he supported Serna’s decision to retire. In 29 years of public service, Serna has “served the people of New Mexico ably, promoted economic development and helped the underprivileged,” Richardson said.
The five-member PRC accepted the agreement with only Commissioner E. Shirley Baca voting no. She said she didn’t object to Serna’s retirement, but said any settlement contingencies amounted to “holding us hostage.”
She objected to Serna’s keeping the position and title of superintendent for another month.
“It’s like nothing ever happened. … Suddenly he just retired,” she said in an interview.
Marks said the agreement was good for the PRC and the public, saving a potentially long and expensive legal fight had the commission fired Serna.
Marks said Serna’s retirement was sought by PRC members, including Chairman Ben R. Lujan and Marks, and that the agreement was negotiated largely by Lujan.
“The continued entanglements with (Serna’s) private interests and official duties and the ongoing controversy just tells us that it was time to move on,” Marks said in an interview. He was the only commissioner to attend the meeting in person; the others were on the phone.
Century Bank, of Santa Fe, won a contract in 2003 to act as the depository for hundreds of millions of dollars in securities that insurance companies are required to post.
For a time, the division’s contract with the bank included fees higher than allowed by law.
The bank has contributed $129,000 to Con Alma Health Foundation, which Serna helped found. He was its board president until he resigned that position recently.
Serna has said the contract with the bank had nothing to do with its donations to the nonprofit Con Alma, which provides grants to health providers.
Separately, Serna has been named in a lawsuit that alleges that title insurance firms tried to persuade him to raise rates by donating to Con Alma. The superintendent called the allegations “laughable.”
And Serna recently defended his intervention in an automobile accident insurance claim involving his daughter, saying he didn’t do anything improper.
Serna, 57, a Democrat, has been insurance superintendent since 2001. He served for 17 years as a member of the elected State Corporation Commission, a regulatory agency that was a predecessor to the PRC. Before that, he was secretary of the Employment Security Department — now the Department of Labor — under then-Gov. Bruce King.
Serna was appointed to be a regional outreach coordinator for the U.S. Department of Agriculture after losing two elections for the 3rd District congressional seat.
No replacement has been determined yet.
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