Bill Richardson Withdraws as Obama's Commerce Pick

New Mexico's governor is entangled in a grand jury investigation of CDR Financial Products, a corporate donor that won a big state contract

By the Associated Press

WASHINGTON—New Mexico Gov. Bill Richardson on Sunday, Jan. 4, announced he was withdrawing his nomination to be President-elect Barack Obama's Commerce Secretary amid a grand jury investigation into how a corporate political donor won a lucrative state contract.

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 in the New Mexico affair.

A federal grand jury is investigating how a California company that contributed to Richardson's political activities won a New Mexico state contract worth more than $1 billion. 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 that he and his administration acted properly.

Keeping his governor's post

"But I have concluded that the ongoing investigation also would have forced an untenable delay in the confirmation process," Richardson said. "Given the gravity of the economic situation the nation is facing, I could not in good conscience ask the President-elect and his Administration to delay for one day the important work that needs to be done."

Richardson said he will remain as governor and said he told Obama: "I am eager to serve in the future in any way he deems useful."

The announcement came ahead of Obama's Monday meetings with congressional leaders on a massive economic recovery bill he wants lawmakers to pass quickly.

Obama said he has accepted "with deep regret." Richardson's withdrawal, first reported by NBC News.

"Governor Richardson is an outstanding public servant and would have brought to the job of Commerce Secretary and our economic team great insights accumulated through an extraordinary career in federal and state office," Obama said. "It is a measure of his willingness to put the nation first that he has removed himself as a candidate for the Cabinet to avoid any delay in filling this important economic post at this critical time. Although we must move quickly to fill the void left by Governor Richardson's decision, I look forward to his future service to our country and in my administration."

$1.48 million in fees

A person familiar with the proceedings has told the Associated Press that the grand jury is looking into possible "pay-to-play" dealings between CDR Financial Products and someone in a position to push the contract through with the state of New Mexico.

State documents show CDR was paid a total of $1.48 million in 2004 and 2005 for its work on a transportation program.

Richardson ran against Obama in the Democratic Presidential campaign, but withdrew after finishing poorly in the Iowa caucuses and the New Hampshire primary.

He is one of the most prominent Hispanics in the Democratic Party, having served in Congress and as President Bill Clinton's ambassador to the United Nations and as U.S. Energy Secretary. As governor, he has kept up an international profile as a specialist in negotiating with countries regarded as rogue nations. Obama also considered him for the post of Secretary of State.

CDR and its chief executive officer, David Rubin, have contributed a total of at least $110,000 to three political action committees formed by Richardson, according to an AP review of campaign finance records.

The largest donation, $75,000, was made by CDR in June 2004—a couple of months after the transportation financing arrangement won state approval—to a PAC Richardson established before the Democratic National Convention that year.

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