He hasn’t publicly revealed when he will leave his post, but Treasurer David Petersen began to clear out his office this week.
Arizona Capitol Times has learned that Governor Napolitano is considering at least three people as interim treasurers. They are: Richard Pentrenka, former chief deputy treasurer who lost to Mr. Petersen in the 2002 Republican primary; Richard Houseworth, former superintendent of the Arizona Banking Department (now the Department of Financial Institutions); and Elliott Hibbs, former director at the revenue and administration departments.
Meanwhile, acting on statutory authority, the Department of Administration on Oct. 27 began oversight of day-to-day operations at the troubled agency, DOA Director Bill Bell said.
He said his decision to assign agency accountants to the Treasurer’s Office on a daily basis came after a meeting Oct. 26 with Mr. Petersen.
The accountants are reviewing past “transactions,” Mr. Bell told the Board of Investment in a special meeting Oct. 30. The board oversees $10 billion in investments of state and local government funds.
At the meeting, Mr. Petersen, who under a plea agreement with the Attorney General’s Office pleaded guilty to a class 1 misdemeanor and must resign by Dec. 1, told the board he made a “mistake” by not disclosing a $4,200 commission he received from a character education organization.
But Mr. Petersen said he has been vindicated of “rumors and allegations” regarding possible felonies investigated by the Attorney General’s Office.
The treasurer said he would like the DOA accountants to take a look at the Local Government Investment Pool (LGIP) because it has not been reconciled for more than a year.
Board member Stephen Barnes complained that the board had not been told that.
Chief Deputy Treasurer Blaine Vance said the situation doesn’t mean there are problems with the LGIP, only that it has to be reconciled among three separate accounting programs.
DOA director: ‘Not assuming treasurer’s role’
“My interest is to hold that office together until issues are resolved,” Mr. Bell said. “We are not assuming the treasurer’s role. We have no ax to grind.”
He said DOA has visited the Treasurer’s Office over the past three months because of the “turmoil” within the agency.
Mr. Vance became the second employee to file a whistleblower claim against Mr. Petersen, asking for more than $2 million in damages. His claim, along with a $3.5 million claim from former chief of staff Tony Malaj, is in DOA’s hands for settlement or denial.
Because of his role with DOA, Mr. Bell has recused himself from being involved with the claims, he said.
Arizona Capitol Times also reported Mr. Petersen in February asked at least two staff members if visits to pornographic Web sites on his computer could be detected by the AG’s office, which had seized his and other computers two weeks earlier.
“That always bothers me,” Mr. Bell said of the pornography matter.
Mr. Petersen says he requested that DOA come in after he was served with Mr. Vance’s whistleblower claim, but there are indications Mr. Bell called the treasurer into his office and didn’t give him much choice.
Mr. Bell of DOA has statute on his side, specifically A.R.S. 41-735.
“[T}he department shall have access to, and authority to examine, any and all books, accounts, reports, vouchers, correspondence files and other records, bank accounts, money and other property of any state agency, whether created by the constitution or otherwise,” the law reads.
“An officer or employee of any such agency, having such records under his control, shall permit access to and examination thereof upon the request of the director or his authorized representative. Any officer or person who knowingly fails or refuses to permit such access and examination is guilty of a class 2 misdemeanor.”