But Crane, a four-term treasurer, acknowledged Monday that his office six years ago lacked adequate controls on decision-making, leaving too much power with individuals.
Legislative Services auditors last week issued a report saying Crane's office fell short of its duty to protect the state's money. Idaho has already lost $10 million, and it faces more than $14 million in unrealized losses from the 2008 transactions.
Now, however, Crane maintains he has bolstered the team that invests Idaho's money and insists the inadequate controls are history. He made the comments in an hour-long afternoon interview in his office with reporters where he gathered seven of his office's employees to help explain and defend his handling of investments.
"We've fixed it. We've addressed it," Crane said. "I'm very proud of the direction we've made, the restructuring we've made."
Crane, first elected in 1998, said he plans to seek a fifth term.
On Friday, state auditors released the report concluding his office inappropriately transferred mortgage-backed securities with a total face value of $86 million from an investment fund he oversaw for local governments, called the Local Government Investment Pool to an account that he manages for state agencies known as the Idle Pool.
Crane made the shift after the ratings agency Standard and Poor's warned him it was considering a downgrade of the local government fund, barring action to improve its balance sheet.
Among other things, however, auditors criticized Crane's office for exchanging the securities at their face value, rather than their lower fair market value, at the time of the transactions.
The difference was nearly $20 million at the time.
Crane's office sold the securities last year, resulting in a $10 million loss.
"This is an exchange transaction that should have been handled at arm's length (and) should have had adequate internal controls in place to protect the interests of both parties," auditors wrote. "The transactions were completed at amounts in excess of fair market value."
At Monday's afternoon meeting, Crane insisted the state auditors' critical report didn't properly consider that securities transfers between the local government and state accounts at their face value, not their market value were common and perfectly appropriate, according to his office's rules.
Though Standard and Poor's was considering a downgrade as the value of the homes pledged as collateral for the mortgage bonds plunged, Crane today insists that only with hindsight's benefit can anybody today conclude his office disregarded its fiduciary duty.
His investment manager at the time, Liza Carberry, assured him the mortgage-backed securities would continue to perform as they had in the past, irrespective of Standard and Poor's concerns, he said.
"All the risk that I was aware of was that the rating of the Local Government Investment Pool ... and there was no downside to the Idle Pool," Crane said. "So that's why it made sense to me. Looking back, of course, hindsight is 20-20."
April Renfro, a certified public accountant who oversees Idaho's Legislative Audits Division, says she stands by her auditor's report.
Additionally, state Sen. Dean Cameron, R-Rupert, has suggested Crane's office needs additional oversight to protect against similar transactions occurring.
On Monday, Cameron was still seeking clarification from Crane on why he denies his office did anything to expose state taxpayers to undue risk, while simultaneously protecting the local government fund from losses from the mortgage bonds.
"I still have concerns," Cameron said. "Am I satisfied? No."