State lawmakers heard from Arkansas Treasurer of State Martha Shoffner (D) on Monday (Sept. 17) to answer questions about her investment policies. At the hearing, a key senior manager in Shoffner’s office asked about “whistleblower” status.
An audit report issued Friday by the Arkansas Division of Legislative Audit raised issues with business practices in Shoffner’s office, as was previously reported by Talk Business blogger Jason Tolbert.
Shoffner has steered an extraordinary amount of investment business to St. Bernard Financial Services in Russellville. Friday’s audit report found “significant deficiencies” with how several large bond transactions were conducted. One finding included:
Subsequent to June 30, 2011, the Treasury sold bonds from its investment portfolio to selected bond brokers before the bonds reached maturity and subsequently purchased similar bonds from the same investment brokers, resulting in a net economic loss of $58,172. This practice differs from the Treasury’s previous practice of holding bonds until maturity.
Legislators issued a subpoena for Shoffner to appear before an audit committee on Friday, but the Arkansas State Police were unable to locate her. However, she appeared on Monday.
Shoffner couldn’t explain the investment practices in question. One of her chief deputies, Autumn Sanson, asked today’s Joint Auditing Committee if she could be covered under the Whistleblower Protection Act over questions regarding the bond investments.
Sanson says she felt the sale was premature.
“I just advised that we do not sell bonds early. I don’t know if that’s my duty to tell what’s ethical,” Sanson said.
Dustin Barnes with our content partner, Fox 16 News, has video coverage of today’s hearing. You can access it here.