Auditor cites improper use of public funds at Western New Mexico University

SILVER CITY, N.M. -- Top officials and regents at Western New Mexico University failed to uphold their fiduciary responsibilities by consistently running afoul of travel and purchasing policies, according to investigators with the New Mexico state auditor's office.

The agency made public its findings Tuesday, saying a review of spending between July 2018 and June 2023 identified numerous instances of wasteful spending and improper use of public funds. The review cited more than $363,000 in spending that didn’t comply with university rules.

State lawmakers started raising questions last year about international trips by university President Joseph Shepard, his wife’s use of a university purchasing card and spending on high-end furniture. At the time, Shepard said that regents vetted his spending requests and that he was familiar with policies and procedures that govern the spending of public money.

Despite the scrutiny, regents threw their support behind Shepard. They declined to stop international travel despite a recommendation by the state Higher Education Department that a cost-benefit analysis be done before trips resumed.

State Auditor Joseph Maestas sent a letter Monday to the university Board of Regents President Mary Hotvedt. In it, he noted that the review found “a concerning lack of compliance” with established university policies.

“Without strong and committed leadership to reinforce the internal control system, the university remains at significant risk for fraud, waste, and abuse,” Maestas wrote. “Effective governance is crucial in setting the tone at the top, embracing accountability and transparency, and ensuring that all employees understand the importance of these controls and adhere to them diligently.”

When asked if Shepard would comment on the findings, the university provided a statement from Hotvedt that indicated the concerns have been addressed by university leadership and that an independent audit was pending.

Hotvedt said university policies have been updated and travel and procurement procedures have been revised. Staff also is being trained to ensure compliance, and an independent analysis is being done to determine any benefits from the university's international initiatives.

The university declined to say whether there would be any sanctions for the policy violations.

The state auditor's investigation looked at more than 400 instances of domestic and international travel and lodging that didn’t comply with university policies and rules. That included trips that Shepard took that appeared unrelated to official university business, such as conferences and events where his wife was a guest speaker.

Shepard’s wife, Valerie Plame, is a former CIA operations officer who ran unsuccessfully for New Mexico’s 3rd Congressional District in the 2020 Democratic primary.