Former State Treasurer Martha Shoffner (D) had her guilty plea rejected by a federal judge on Friday (May 31) after refusing to admit she took cash payments in exchange for steering an inordinate amount of state bond business to a Russellville firm.
Shoffner, 68, has admitted to accepting $36,000 in in cash from an unnamed informant believed to be a securities dealer with Russellville-based St. Bernard's Financial Services. Shoffner was arrested nearly two weeks ago on federal extortion charges after the informant delivered $6,000 to her in a pie box at her Newport home on Saturday, May 18.
On Friday in federal court, Shoffner was asked by U.S. District Judge Leon Holmes if the money she received led her to push millions of dollars of bond business to St. Bernard's, which has received an extraordinarily disproportionate amount of bond business from the Treasurer's office in the last two years.
Shoffner told the judge she did not accept the money in order to steer business to the firm, but to simply pay her rent.
Judge Holmes said he could not accept Shoffner’s plea based on the fact that her admission to taking the money did not also include her acknowledgement that the act included steering bond business to St. Bernard's.
The case now goes to trial, with an undetermined date, unless prosecutors and Shoffner's legal team can produce a second plea deal. Shoffner is represented by former U.S. Attorney Chuck Banks.
She could face up to 20 years in prison and be fined $250,000.
Shoffner could also face state charges stemming from the practices of her office and the cash payments she received. She could also be facing an investigation by the IRS and state tax officials for her failure to declare income, as well as state ethics charges for her lack of disclosure of the gift receipts.