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updated 11/12/2010 3:13:36 PM ET 2010-11-12T20:13:36

State Auditor Hector Balderas announced Friday his office is looking into possible bid-rigging of construction and maintenance contracts at New Mexico correctional facilities.

He declined to name the contractors, saying his audit isn't completed and could expand. The contracts involve work such as roofing and security-equipment installation at state-owned facilities, and were issued between 2007 and this year, Balderas said in an interview with The Associated Press.

An initial review has found about $10 million worth of contracts that are "high-risk for potential excessive billing or collusion," he said.

The Corrections Department asked the auditor's office to look into the contracting matter, according to Balderas, and his office had received a tip through its fraud hot line.

If wrongdoing is found, the state auditor can refer cases to authorities for prosecution.

"Unlawful profiteering on the backs of New Mexico's taxpayers will not be tolerated," Balderas said.

At issue are a mix of no-bid contracts and some contracts issued after competitive bidding, he said.

The special audit will be done by a team from the Special Investigations Division of the auditor's office. Balderas said it's uncertain when the audit will be finished.

The Corrections Department operates prisons across the state, including Santa Fe, Los Lunas, Grants, Roswell, Springer and Las Cruces. The agency also houses state inmates in privately operated prisons at Hobbs, Santa Rosa, Grants and Clayton.

A department spokeswoman had no immediate comment on Balderas' announcement.

Copyright 2010 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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