"I'm getting angry just talking about it," Abshure told ArkansasBusiness.com on Tuesday.
Abshure, 34, was most recently a partner at the Williams & Anderson firm in Little Rock and previously a staff attorney for the Securities & Exchange Commission in Washington, D.C. He was appointed to lead the Arkansas Securities Department by Gov. Mike Beebe in December.
The department has a longstanding relationship with the AARP for the purpose of educating older Arkansans about solid investment practices. But that relationship is going to be expanded by training AARP volunteers to help with investigations as well. These "senior sleuths" will, for example, attend "free-lunch seminars" in which investment opportunities are pitched in order to spot potentially fraudulent claims, Abshure said.
"It's absolutely imperative that seniors have access to the capital markets," he said. "...I just want to get the bad guys out so the good guys can get to them."
Some free-lunch sales pitches are completely legitimate, Abshure said, and even bad operators rarely defraud investors at the seminars themselves. But later, in one-on-one meetings with intrigued potential clients, high-pressure tactics too often lead seniors to make hasty decisions by discouraging them to from reviewing the investment with any other advisor.
"They don't want anyone else to look at it," Abshure said. "If it's not fraud, it's at least a bad sales situation."
Using More Tools
Abshure said the cut in pay he took by becoming securities commissioner - a job that pays about $90,000 a year - has been more than made up by the satisfaction he feels in his new job.
"This is kind of my dream job, and it allows me to combine two things that are very important to me," he said. Those things are securities regulation and his love for "all things Arkansas."
Abshure believes that regulating "reasonably" removes bad actors from the market and creates more business for legitimate securities firms. The department under his direction will "be more preventative rather than reactive" to securities violations, he said, but it will also make more use of available enforcement tools than it has in the past.
In addition to cease-and-desist orders, which have been the department's stock in trade, Abshure said he wouldn't hesitate to file civil lawsuits against bad actors, including suits seeking to recover money taken by fraud. The department hasn't used that tool to its fullest potential in recent years, he said, but Abshure has already filed suit in Pulaski County Circuit Court seeking an injunction against a Bentonville "construction and investment firm" that continued to advertise unregistered investment products on its Web site even after a cease-and-desist order was entered earlier this month.
The Arkansas Securities Department regulates stockbrokers and financial advisors, mortgage brokers, the one remaining state-chartered savings and loan association (Corning Savings & Loan Association), and money transmission and currency exchange services.
It does not have jurisdiction over variable annuities, which are treated as securities by the SEC but which Arkansas law defines as insurance products and places under the control of the Arkansas Insurance Commission. But Abshure said he might get involved in regulating variable annuities if they are being sold by anyone other than a licensed insurance agent - or even by an insurance agent if he recommends that a client sell other securities in order to buy a variable annuity.
"Then I think he's backed himself into my jurisdiction," Abshure said.