Stephens Inc. Asks Legislators to Consider Changes to Securities Law

by Gwen Moritz  on Wednesday, Jan. 22, 2014 5:10 pm  

Securities Commissioner Heath Abshure

Speaking under oath after Abshure, Stephens General Counsel David Knight said Abshure's statements to the commission had been "inconsistent." Of the email from Freydl, Knight said, "Well, you know, I know when I've been threatened."

"One thing that was clear to me" at the meeting with Abshure, Knight said, was that if Stephens had agreed to donate $20,000 to NASAA, "we would have been done."

When Lowery asked Abshure whether it would have been better for Abshure to suggest a donation to an organization of which Abshure was not president, Abshure responded: "As to appearance, absolutely. As to benefit to the state, I don't think that at all."

After the hearing, Abshure said he would no longer allow any violator to make a payment to a third party in lieu of a fine or any other creative settlement.

"At this point, all I feel comfortable doing is levying a fine or taking someone's license away."

Crews Settlement

Abshure again told legislators that Crews & Associates asked to avoid paying a fine when the ASD investigated its role in the sale of problem-plagued bonds issued by Bamco Gas LLC. Because Crews had cooperated with the investigation and had voluntarily repaid all investors, Abshure said he thought Crews had "earned the right to have that amount treated as a contribution rather than a fine."

Crews President Jim Jones and outside counsel Mike Miller were available for questioning by the committee, but they were not sworn in and they were not asked about their experience in negotiating with Abshure.

After the meeting, however, Arkansas Business asked Miller, who said he was present for the negotiations, whether Crews had in fact asked for a way to avoid paying a fine.

"No," Miller responded.

Told that Miller disputed his version, Abshure reiterated his previous statements.

"Crews asked me if there's a way we can avoid a fine," he said.



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