TRADE SECRETS

ARIZONA'S TRADE REPRESENTATIVE TO MEXICO WAS CUTTING DEALS WITH HIS FRIENDS AND FAMILY. A SECRETARY REPORTED THE PROBLEM--AND PROMPTLY GOT CANNED.

Last October was crunch time for the North American Free Trade Agreement. Ross Perot had been babbling about sucking sounds. No one knew whether NAFTA could pass Congress. A golden opportunity to cut political deals was at hand.

Deals were being struck not just in Washington, D.C., but in Mexico City, as well.

NAFTA opponents were winning the public relations war when Arizona Governor J. Fife Symington III boarded America West Airlines Flight 32 on the morning of October 20 for a nonstop flight to Mexico City. Officially, Symington was on a political good will mission meant to underscore his fervent support for NAFTA to Mexican President Carlos Salinas de Gortari.

"We are all making calls across the USA to Congressmen to push hard for approval, and I am still very optimistic and pray that Congress does the right thing," Symington later wrote to Salinas.

But Symington was not just seeking Salinas' assistance on opening the Mexican market for Arizona business. Symington and Arizona's top trade representative to Mexico, Jorge Z. Mej¡a, also were helping an Oregon businessman with no apparent ties to Arizona--no ties, that is, other than a friendship with the governor.

Symington and Mej¡a used the meeting with Salinas and a later conference with the Mexican energy secretary to catapult the governor's friend, J. Bradford Bishop, to the pinnacle of Mexican politics, placing him on an inside track for lucrative contracts from the Mexican national electric utility.

"My friend, Brad Bishop of Carson Energy, was . . . deeply gratified to have met you," Symington wrote in an October 29 letter to Salinas. "As you may know, Mr. Bishop is keenly interested in infrastructure investment in Mexico."
Victoria Guerra, an executive secretary in Arizona's Mexico City trade office, knew little about Bishop or his trip. While she was opening office mail, though, Guerra ran across a $3,000-plus check from Bishop to her boss, Mej¡a.

Guerra knew that procurement laws strictly prohibit state officials such as Mej¡a from profiting through their public positions.

So she reported the payment to her superiors.
It took them less than a month to take action.
They forced her to resign.
@rule:

@body:No one had more experience running the Mexico City trade office than Guerra. The executive secretary, who has a master's degree in English from Ohio's Oberlin College and also speaks German and Spanish fluently, was hired four months after the office opened in March 1992. She became the de facto director in March 1993 after the sudden death of former director David Clay.

For the next six months, Guerra ran the day-to-day operations of the office and represented Arizona at official functions. Commerce officials were so pleased with her performance that she was the guest of honor at an April 1993 dinner attended by former Commerce Department director and Symington confidant Jim Marsh and Deputy Commerce Director David Guthrie.

Among other duties, she kept track of office expenses and filed a monthly accounting ledger with Commerce officials in Phoenix. Guerra began to detect problems with Mej¡a's expense reports soon after he was appointed to the job in August of last year. Among those problems were Mej¡a's failure to pay routine office expenses and salaries, sources familiar with the Mexico City operation say. Guerra also questioned contracts between the trade office and firms that have ties to members of Mej¡a's family.

Guerra met with New Times in Mexico City, but declined to be quoted for this story. State documents obtained through the public records law, however, detail many of the events leading to her forced resignation.

"Within a month I began to notice that the office was being managed in a manner very differently from the way it had been under Mr. Clay," Guerra wrote in a January 24 letter to William Bell, assistant director for personnel services.

"The office funds, expenditures and expense reports to Arizona were particularly curious."
The accounting irregularities ballooned into a larger potential problem for Mej¡a in late October. Mej¡a was in Arizona on a 14-day get-acquainted visit when Guerra discovered Bishop's $3,306 check while routinely opening the office mail.

After consulting with friends in the Commerce Department in Phoenix, Guerra decided to forward a copy of the check to one of her superiors, International Trade Director Dorothy Bigg.

"When Mrs. D. Bigg received the fax of this document and asked Mr. Mej¡a (who at the time was in Arizona) for an explanation, he found a very simple excuse for it and promised to Mrs. Bigg that he would return it to the sender and ask him to rewrite it in the name of the Mexican company which had done the translation," Guerra wrote in her letter to Bell.

But according to Guerra's letter, Mej¡a didn't tell Bigg one crucial fact about the Mexican company, which, Mej¡a had said, performed translation services for Bishop. Mej¡a, Guerra charges, failed to mention that the company was owned by his sister-in-law.

(Bigg, Mej¡a, Guthrie and other Commerce Department officials declined to be interviewed for this story.)

Guerra's fate was sealed upon Mej¡a's return to Mexico City. The 47-year-old tennis and computer buff was furious with Guerra for sending Bishop's check to Phoenix.

Late on the afternoon of December 10, Guerra wrote, "Mej¡a informed me that I was fired, and either I signed a letter of 'VOLUNTARY RESIGNATION' or he would not give me a dismissal payment."

Guerra reluctantly resigned her position.
Mej¡a immediately appointed his 23-year-old niece, Silvia Allen, to Guerra's job.

@rule:
@body:Jorge Mej¡a did not do well in the initial round of interviews conducted by Commerce Department officials searching for a director for Arizona's Mexico City trade office. State procurement records show Mej¡a barely scraped into the upper third of the pack of 60 applicants for the position.

But sometime between that first impression and a second round of interviews, Mej¡a's stock soared with Bigg, Guthrie and two other Arizona trade officials reviewing bids to run the Mexico City trade office. Suddenly, Mej¡a, who initially was rated no better than average, was among the finalists for the position.

Once making that leap, it was clear sailing for Mej¡a, whose scorecard racked up the most points in each succeeding interview round. It's unclear why Mej¡a was so highly rated. His business and educational background is far from impressive when compared to those of other applicants for the position, several of whom had advanced degrees in international trade and extensive business experience.

Mej¡a's educational history is particularly thin. He claimed to have graduated from a teaching university in Mexico, but couldn't produce a diploma. He told Commerce officials in an August 2 letter that he was unable to obtain a copy of the diploma from the Ministry of Education because the agency was "undergoing a substantial reorganization."

Commerce officials tried to confirm his graduation independently, but were unable to do so, state records show.

Mej¡a did produce another diploma while documenting his accomplishments for state officials. The diploma was awarded for attending a one-week course at Maharishi International University in Fairfield, Iowa, and is graced by the likeness of His Holiness Maharishi Mahesh Yogi. During his stay in America's heartland, Mej¡a studied such subjects as "Vedic Mathematics and Financial Management: Do Less and Accomplish More."

In an abbreviated r‚sum‚ Mej¡a circulated with state officials, Mej¡a also claimed to have "postgraduated from Stanford University (Advanced Management College)" and "postgraduated in management from UCLA." Neither Stanford nor UCLA has any record of Mej¡a attending the universities, and there is no such thing as the "Advanced Management College" at Stanford.

(Mej¡a did attend a three-month management-development program at UCLA in 1981. He also spent a week at Stanford's Sierra Camp in 1984, taking 60 hours of management courses.)

Mej¡a's employment background cannot be called overpowering, either. For the last four years, he has operated a consulting business out of the apartment he shares with his wife. Mej¡a admitted in a videotaped interview with Bigg that he wasn't making much money from the firm.

The consulting business was started in July 1989, a month after Mej¡a left his position as a divisional vice president for Maritz Travel Company, where he worked for eight years. He briefly held jobs with American Express Travel Co. and the Americana Coral Beach Hotel.

Despite his apparent lack of academic and business credentials, Mej¡a caught the eye of Commerce officials by making what they considered a strong personal impression and developing a solid business plan for running the office, state procurement records indicate.

But he was offered the job before Commerce officials had even finished conducting their review of his past employment, Commerce Department records show.

@rule:
@body:Exactly how Mej¡a fits into the Symington-Bishop relationship is unclear. And the governor's connection to Bishop, the Lake Oswego, Oregon, businessman, is also a mystery at this point.

Symington and members of his staff refuse to discuss the governor's ties to Bishop and his energy firm. (Although there appear to be no direct business links between Bishop and Symington, the governor has had a long-standing interest in the energy sector. One of the first companies he formed was the Symington Oil & Gas Co., now known as Wicklow Management Co.)

Bishop has also declined to return New Times' phone calls. Mej¡a cut short an interview in Mexico City before the Bishop visit could be discussed.

It is clear that Symington has helped Bishop meet with top Mexican officials more than once. Last July, the governor wrote a letter to Sonoran Governor Manlio Fabio Beltrones, urging him to meet with Bishop to discuss construction of a gas-fired electric generating plant.

Documents turned over to New Times by the Governor's Office, however, raise as many questions as they answer about the Symington-Bishop-Mej¡a troika.

In one instance, six pages of a letter faxed to the Governor's Office from Bishop's company--a letter sent five days after the Salinas meeting--are missing. Douglas Cole, the governor's press secretary, says those pages just aren't in the state file.

If the missing pages are anything like the last page, however, the letter must have been a fascinating document.

On the bottom of the eighth page is a copy of the $3,306 check from Bishop to Jorge Mej¡a. The check supposedly was for translation services. Bishop, it seems, had arranged for Mej¡a to translate several books given to him by Mexican officials.

Mej¡a should have known it would be improper to contract with Bishop. Four months earlier, during a job interview, Mej¡a told Bigg, the state's international trade director, that he had thoroughly read the state's procurement rules and understood the conflict-of-interest provisions--provisions that preclude him from receiving money from businessmen seeking help from the Mexico City trade office.

So far, Mej¡a has escaped serious repercussions from the Bishop check.
Commerce officials clearly are concerned about the possibility of scandal in one of their three international trade offices, which are under scrutiny this year by the legislature.

"We can't afford a failure down there," Bigg wrote in a December memo that specifically referred to the Mexico City operation.

A $300,000 appropriation for the Mexico City trade office is up for renewal during this legislative session. Some state legislators want Arizona businesses to contribute to the cost of running the Mexico office, as well as those in Taiwan and Japan--a move strongly opposed by Commerce.

With damage control becoming the overriding factor, the person who blew the whistle on Bishop's check to Mej¡a became expendable. But removing Guerra from the state payroll cannot make her allegations disappear. And those allegations involve a lot more than one $3,000-plus check.

@rule:
@body:Guerra is a slim, gracious woman with years of experience and extensive contacts in Mexico City's diplomatic and business community. She wasn't about to leave her job at the trade office without a fight. But she also knew there were two ways to conduct the battle--in public or through proper government channels. She chose the latter, and continues to decline on-the-record interviews.

In mid-January, Guerra sent a five-page letter to Bigg outlining a dozen "irregularities" in Mej¡a's direction of the office. Many of them involve trivial matters, such as the hiring of an office maid and purchase of new stationery. But several are more serious. (A copy of the January 17 letter made its way to New Times from a source other than Guerra.)

In addition to the Bishop check, Guerra claimed, Mej¡a had commissioned two ethically questionable contracts, one involving a telemarketing campaign operated by his niece, and the other the purchase of $21,000 worth of computer equipment.

Commerce Department records reveal that Bigg placed little credence in Guerra's complaints.

"While my initial inclination is to totally disregard her assertions as typical of a disgruntled employee who has been terminated, perhaps you would clarify this, just to be sure we have all bases covered should she spread these rumors further," Bigg wrote in a January 24 memorandum to Mej¡a.

Mej¡a covered those bases a week later in a three-page note to Bigg, offering a series of explanations of Guerra's allegations. Bigg accepted Mej¡a's statements as gospel.

"After much discussion and thorough investigation of your allegations," Bigg wrote in a February 25 letter to Guerra, "we have come to the conclusion that Jorge [Mej¡a] has done nothing unethical or illegal."
It is clear that investigation was not, in fact, very thorough.
@rule:

@body:After obtaining copies of the bids Mej¡a said he had received from three computer retailers, New Times visited those same Mexico City firms and obtained price quotes for some of the same equipment purchased by the state last October.

The first stop was Computiendas Denki, the company that won the $21,118.90 trade-office contract, where Ricardo Targa said he was Computiendas Denki's supplier and was authorized to sell equipment to individuals for the same price as Computiendas Denki.

New Times provided Targa with a list of computer equipment that included items purchased four months earlier by Mej¡a for the state trade office.

Targa said he would sell the equipment for $2,557, about half the price that the state had paid Computiendas Denki last October.

The next stop was AR-TEK, a computer retailer that submitted the highest of three bids for the contract.

AR-TEK's manager, Carlos Soto Rodriguez, produced an estimate for the equipment that was slightly higher than the price submitted to Mej¡a several months earlier. In responding to a request for a price quotation, however, Rodriguez unknowingly provided other important information.

The fine print on his business card contained two addresses. One was for his own store. The other was the address for none other than Computiendas Denki, the "low" bidder to provide Mej¡a with computer equipment.

The third firm that had submitted a "bid" to provide Mej¡a's office with computers was Excelencia en Sistemas Computacionales, which doesn't appear in the Mexico City phone book.

A two-story residential building stands at the site listed as the address for Excelencia. The building had no signs indicating it was a business. An elderly woman who came to the door said she did not know Jose Collepardo, the person submitting Excelencia's bid for the state contract.

"There is no Jose Collepardo here," she said.
The woman said her address matched the one given for Excelencia. But there was no Collepardo and there were no computers for sale, she said.

In short, two of the bids for the computer equipment supplied to Mej¡a's office came from companies that share the same address. The third bid was submitted by a company that doesn't appear to exist.

None of this could possibly surprise Guerra. She warned the state in a January 17 letter that the computer contract appeared to be unusual.

Guerra told Bigg that all three bids for the computer equipment arrived on the same fax transmission, and that Mej¡a had planned with a friend to steer the computer contract to the friend's business.

"It all happened exactly as he [Mej¡a] planned it," Guerra wrote.
@rule:
@body:Mej¡a's penchant for doing business with friends and relatives hardly stops at computers or translation. And Lisa Weigt, marketing director for the state tourism office, found out the hard way just how poorly Mej¡a's family can perform.

Weigt entrusted Jorge Mej¡a with ensuring that more than 600 wholesale and retail travel agencies were invited to attend a three-day affair at Mexico City's most expensive hotel. The tourism office was sponsoring a trade mission for 13 representatives of hotels and convention bureaus across Arizona. Each of the representatives paid $700 to attend the events.

Mej¡a seemed like a natural to assist in this project, given his background in hotel and travel-agency management.

Mej¡a offered Weigt the services of his niece's telemarketing company--manned by his son, his niece and a friend--to help with invitations for the October 25 to 27 trade mission. The tourism office agreed to pay the telemarketing company $1,700 to handle the arrangements.

Once again, Mej¡a crossed the state's conflict-of-interest rules for state contractors by steering business to family members. But no one from Arizona seemed to care.

Even with Mej¡a's assurances that invitations would be sent and follow-up calls made, something gnawed on Weigt's mind as the date for the trade mission approached. Weigt relayed her deep concerns about the situation in an October 8 letter to Mej¡a:

"My biggest fear is that the wholesalers will not attend the function on Monday. This day is so important. If this day goes well the delegates will all be happy. (If their [sic] happy so am I.)"
Mej¡a eased Weigt's fears somewhat when he called her three days before the event and told her he had received confirmations from twice the number of wholesale travel companies Weigt had expected to attend the first day of the three-day trade mission.

Weigt made last-minute arrangements with the Hotel Nikko to add more table settings for breakfast and lunch to the conference room to accommodate the bigger crowd promised by Mej¡a. The last-minute change added $1,215 to Monday's bill, bringing the total for the day to $4,000.

The Arizona travel delegation was up bright and early on October 25, heading for the Hotel Nikko's conference room and the trade mission's kickoff breakfast. Within minutes of the delegation's arrival, it was clear there was a major problem. The 8 a.m. starting time came and went; no Mexican tourist representatives appeared. Breakfast was served. Still no action.

Panic filled the air as Lisa Weigt and Arizona Office of Tourism public relations liaison Leia James scrambled to determine why no one had shown up. Everyone was stunned.

"They [state officials] were as shocked as we were" by the lack of response, says Lupe Pickrel, who attended the conference for Flagstaff's Little America Hotel.

And where was Jorge Mej¡a, who three days earlier told Weigt that the telemarketing team had 80 confirmations for the breakfast? He had scurried out the door of the Hotel Nikko to meet his wife, and then headed to the airport to fly to Phoenix for a 14-day, all-expenses-paid tour of Arizona.

His niece's telemarketing team was left behind to handle the disaster.
Two months after the trade show, Mej¡a sent a letter to Weigt demanding that the tourism office pay the telemarketing team, records obtained from the office under the state public records law show.

"I hope this delay in payment has nothing to do with the poor attendance to [sic] October 25, 1993," Mej¡a wrote.

The tourism office caved in to Mej¡a's demand for payment, cutting a check for $1,715.18. The check was made out to his niece's company--which also employs Mej¡a's son, Jorge Mej¡a Jr.

@rule:
@body:Commerce officials couldn't help but notice the strange activities occurring in Mexico City under their new director. So a memorandum was prepared and distributed.

"Your family members are not allowed to do work for or contract with your respective offices. This is clearly a conflict of interest which cannot occur," reads a November 22 memo issued by Deputy Commerce Director David Guthrie.

Once again, there is little doubt that Mej¡a received the message. He confirmed he understood the policy in a letter to Dorothy Bigg. The letter was written January 31, about seven weeks after Mej¡a had forced Victoria Guerra to leave the trade office.

"I now realize that as a matter of policy, I should not involve family members in providing services to the State," Mej¡a wrote.

A few days later, Arizona's trade office in Mexico City was ready to award a contract for accounting services. Among other duties, the new accountants would be responsible for dealing with Mexican tax authorities.

A small accounting firm named CONFIE Corporativo Fiscal Empresarial was awarded the $200-per-month (plus expenses) contract on February 9.

Mej¡a's wife is an employee of the firm.

Show Pages
 
My Voice Nation Help
0 comments
 
Loading...