Richardson Drops Bid for Commerce Secretary Post

In this Wednesday, Dec. 3, 2008 file photo, New Mexico Gov. Bill Richardson, listens during a news...

In this Wednesday, Dec. 3, 2008 file photo, New Mexico Gov. Bill Richardson, listens during a news conference in Chicago. Richardson says he is withdrawing his nomination to be President-elect Barack Obama's commerce secretary amid a grand jury investigation. Obama said in a statement Sunday, Jan. 4, 2008 that he accepted Richardson's withdrawal "with deep regret" but that the governor was putting the nation first to avoid any delay in filling the Cabinet post. (AP Photo/Charles Dharapak)

(AP)

New Mexico Gov. Bill Richardson abandoned his nomination to become commerce secretary under pressure of a grand jury investigation into a state contract awarded to his political donors — an investigation that threatened to embarrass President-elect Barack Obama.

Richardson insisted he would be cleared in the investigation and Obama stood by the governor as an "outstanding public servant." But both men said it has become clear that a grand jury probe would not be finished in time for Richardson's confirmation hearings and could keep him from filling the post in a timely matter.

Richardson's withdrawal was the first disruption of Obama's Cabinet process and the second "pay-to-play" investigation that has touched Obama's transition to the presidency. The president-elect has remained above the fray in both the case of arrested Illinois Gov. Rod Blagojevich and the New Mexico case.

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A federal grand jury is investigating how a California company that contributed to Richardson's political activities won a New Mexico transportation contract worth nearly $1.5 million. Richardson said in a statement issued by the Obama transition office that the investigation could take weeks or months but expressed confidence it will show he and his administration acted properly.

Obama spokesman Robert Gibbs said he expected a new commerce secretary to be nominated soon but didn't have a timetable. Gibbs said the problem with Richardson's nomination wasn't a matter that those tasked to look into his background missed something.

"I think the totality of our Cabinet picks is impressive and I think our vetters have done a good job," Gibbs told reporters traveling with Obama as he moved to Washington on Sunday night.

A senior Obama adviser said Richardson gave assurances before he was nominated last month that he would come out fine in the investigation and the president-elect had no reason to doubt it. But as the grand jury continued to pursue the case, it became clear that confirmation hearings would have to be delayed for six weeks or even longer until the investigation was complete, said the adviser, speaking on condition of anonymity about the discussions because they were private.