Arkansas State Treasurer Martha Shoffner Targeted in Criminal Probe

by George Waldon  on Monday, Jan. 7, 2013 12:00 am  

Between July 22, 2009, and Oct. 5, 2011, bond trades for the State Treasurer generated commissions totaling more than $2.3 million for Apple Tree and St. Bernard, thanks to Steve and Steele Stephens.

Committee members were perplexed by the inordinate volume of business and a series of transactions where bonds were sold early and replaced with lower yielding bonds.

The decision to deviate from past Treasury practice of holding bonds to maturity cost the state $783,835 in reduced profits in eight transactions involving St. Bernard, according to the Legislative Audit Division.

Shoffner couldn’t explain why the trades that produced less money for the state and more commissions for St. Bernard made economic sense or why her office did so much more business with the company.

The Legislative Audit Division concluded that the “concentrated use of this one broker offered no apparent advantage to the State.”

Conflicting testimony before the legislative committee that Shoffner did/didn’t direct her staff to do more bond business with St. Bernard only raised more questions.

Shoffner acknowledged that the elder Stephens is a good friend but told legislators last month that he and his son didn’t receive preferential treatment in dealing with her office.

She also told the committee she received no financial benefit from St. Bernard or others doing business with her office.

Investigators are following the money and cross-checking testimony given to the Legislative Joint Auditing Committee.



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