The Bernalillo County Court in downtown Albuquerque

The Bernalillo County Court in downtown Albuquerque

No one is disputing that Armando Gutierrez wrote checks totaling about $750,000 that were deposited into the bank account of Joseph and Elizabeth Kupfer.

But state prosecutors allege that the payments were part of an elaborate embezzlement and fraud scheme in which Gutierrez, the Kupfers and former Secretary of State Rebecca Vigil-Giron stole millions of dollars in federal taxpayer money awarded to Vigil-Giron’s office for voter education.

Prosecutors allege that the stolen money came from a pot of federal voter education money that helped pay for more than 40,000 TV and radio advertisements that ran in English, Spanish and Navajo and starred Vigil-Giron in the months leading up to the 2004 general and 2006 primary and general elections.

Gutierrez, his attorney now says, hired Joe Kupfer as a subcontractor to help him write and produce the ads, which is where the nearly $750,000 in deposits come from, attorney Miles Hanisee said Wednesday.

“There is nothing inappropriate about hiring subcontractors,” Hanisee said. “It happens all the time.”

Hanisee offers an explanation for the origin for the money the Kupfers’ deposited, but it leaves some questions unanswered.

A federal audit released last year into how New Mexico spent the federal voter education money makes no mention of those subcontracting payments to Kupfer, or to a second subcontractor Gutierrez used. In fact, the audit, publicly released in May 2008 by the inspector general of the Elections Assistance Commission, said Gutierrez could not account for $2.2 million of the approximately $4.8 million the state spent on the federal Help America Vote Act money earmarked for voter education.

Hanisee said Wednesday that the federal auditors were incompetent, adding that “There was no scenario in which Gutierrez would say there were no subcontractors.”

According to Hanisee, Gutierrez used two subcontractors in his work for Vigil-Giron, with Kupfer earning up to $800,000 for his work. The other subcontractor, Charlie O’Dowd of Working Boy Productions, made between $75,000 and $100,000, Hanisee said Wednesday.

The roughly $900,000 paid to Kupfer and O’Dowd comprised part of the $2.2 million that the federal audit said Gutierrez couldn’t account for, Hanisee said, adding that he didn’t know what might explain the rest of unaccounted-for money.

But Hanisee was clear about one thing. “There’s not missing money here,” he said.

A spokesman for attorney general’s office, which is prosecuting the case, declined Wednesday to respond to Hanisee’s comments. An attorney for Joe Kupfer could not be reached for comment.

Last year’s audit paints a different portrait of Gutierrez than Hanisee’s. It reported that invoices that Gutierrez “submitted to the Office of the Secretary of State … did not reflect actual cost incurred in the performance of the contract because Gutierrez submitted only plans and budgets as a basis for payment.”

“Also, we noted that there were no payroll or other records identifying the time the Contractor and his staff may have worked on the contract. Therefore, we asked the Contractor if any other records existed that he had not given to us in response to our original request, such as time sheets, daily logs, or diaries,” the audit reads.

After auditors asked Gutierrez about his expenses, they followed up asking him again if he had any receipts.

“The Contractor said that he would check records in storage and advised that it would take several weeks for him to search for those records. We checked back with Gutierrez after several weeks and he said that he had not looked for any other records,” the audit reads.

Hanisee said Wednesday that the federal auditors weren’t clear with his client.

Gutierrez and Kupfer knew each other

While many facts remain unclear regarding the embezzlement and money-laundering scheme that is alleged to have happened, it is clear that Gutierrez and Kupfer were known to each other. Gutierrez, Hanisee said, picked Joe Kupfer because he knew of the other man’s expertise in certain areas.

In fact, it appears clear from state records and interviews that Gutierrez knew Joe Kupfer well prior to tapping him to help him work on the ads for Vigil-Giron.

From 2000 to 2005, Gutierrez had a contract with the New Mexico Office of Attorney General under Patricia Madrid, where Joe Kupfer’s wife, Elizabeth, worked as administrative services director. That contract, which ultimately paid Gutierrez $1.1 million, called on Gutierrez to create ads and other media, records show — similar to the responsibilities Vigil-Giron later assigned to him in 2004.

According to records obtained by the Independent, Elizabeth Kupfer signed at least 12 purchase orders authorizing payments to Gutierrez on behalf of the AG’s office between 2001 and 2005.

“I’m not surprised that they knew each other from the AG’s days,” Hanisee said of Gutierrez and Joe Kupfer. “It’s fair to say that Armando and Joe were familiar with the caliber of each other’s work based on past experience.”

Joe Kupfer was asked to perform several services for Gutierrez in the work he did for Vigil-Giron. Among them was ensuring that the ads that ran met various governmental requirements, Hanisee said.

More than 40,000 TV and radio advertisements ran in English, Spanish and Navajo and starred Vigil-Giron in the months leading up to the 2004 general and 2006 primary and general elections.

“The other role that Joe played is preparing the ads. He was in the studio on many occasions,” Hanisee said, adding that Kupfer had a hand in scriptwriting and production.