Witnesses Portray Martha Shoffner As Cranky, Demanding

LITTLE ROCK — Federal prosecutors drew testimony Thursday from current and former Arkansas treasurer's office employees about how the state missed profit opportunities by selling bonds early and angry outbursts by former Treasurer Martha Shoffner, who is accused of illegally accepting $36,000 from a bond dealer.

The government also worked to block part of Shoffner's lawyer's trial strategy. In opening statements, attorney Chuck Banks told jurors his client should have been cited by the state Ethics Commission for not reporting gifts rather than face federal indictment.

Before the jury was brought in Thursday, Assistant U.S. Attorney Charles Ray White cited case law that would block Banks from saying the wrong law is being applied to the alleged offenses.

U.S. District Judge J. Leon Holmes asked Banks to approach the bench if he intended to use the tactic during cross examination but withheld a formal ruling to give Banks time to write a reply. At stake is whether Banks can continue his tactic in closing arguments, which aren't expected until next week.

Shoffner is being tried on 14 extortion and bribery counts for allegedly steering bond business to dealer Steele Stephens, whose father Shoffner knew from her hometown of Newport.

Stephens was given immunity by prosecutors and is expected to testify. The indictment says he wore a listening device while delivering a payment to Shoffner, which led to her arrest and resignation last year.

Supervising Senior Auditor Joey Buddenberg of the state auditor's office testified that Shoffner had approved a number of trades that involved selling bonds before they matured, costing the state earnings.

"We like explanations for anomalies but we didn't get an explanation beyond, it was what the state treasurer wanted to do," Buddenberg said. "We didn't get satisfactory answers when we asked why these transactions were occurring."

Debbie Rogers, chief deputy treasurer, testified that Shoffner would decide which broker would get the trade when the office needed to make a bond transaction. Chief Investment Officer Autumn Sanson said the same thing and told jurors she repeatedly advised Shoffner against certain transactions and against sending so much business to Stephens, who was with the Russellville-based firm St. Bernard.

Sanson said when she challenged Shoffner, the treasurer told her the office could justify the transactions. Buddenberg said the office had no supporting analysis regarding the trades. An analysis by auditors showed the state missed out on $434,000 worth of earnings.

Sanson said her stances created tension between her and Shoffner. Sanson also described angry, profanity-laced outbursts by Shoffner and said she complained about her staff's competence.

When auditors were reviewing the books, Sanson said, she was asked about the questionable bond trades but could only offer the explanation that, "I was instructed to do so."

She said she felt Shoffner would fire her had she refused or cancelled the transactions.

Cord Rapert, 27, a Jonesboro pharmaceutical salesman and a "distant cousin" of state Sen. Jason Rapert, R-Conway, said he worked two stints as an assistant in Shoffner's office, also helping on her campaigns.

"I was treated horribly," Cord Rapert said. "Nights and weekends were not my own." He said he frequently had to run errands for Shoffner and used his own money to buy her food and pay for her dry cleaning.

He described outbursts of ill temper by Shoffner, saying she'd yell and pound on a desk if something as innocuous as a letter to the Boy Scouts wasn't phrased correctly.

"She didn't understand what was going on in the office, but she ran the office," he said.

Banks asked several witnesses whether Shoffner had the sophistication and background to be a hands-on boss and described her as a figurehead whose role was to promote the work of the office while others did the day-to-day work.

Rapert said that when he submitted his resignation, Shoffner crumpled up his letter, threw it at him and fired him.

Rapert said he'd discussed his impressions of the treasurer's office with his cousin and a number of other legislators on the Joint Audit Committee. Banks said in openings that current and former treasurer's employees tainted the views of auditors and legislators by supplying information to undermine Shoffner.

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