Tolbert: DCCC Hits New Low With Ad Attacking Delta Trust & Bank (UPDATED)

This has certainly been a year of some horrible television ads like nothing Arkansas has ever seen. But in their efforts to help elect Mayor Patrick Henry Hays, the Democratic Congressional Campaign Committee (DCCC) has just begun running a new ad that is perhaps the worst ad of the season. Not only is it slimy, but it may ever be slanderous in my opinion.

The ad is a continuation of the “guilt by association” line of attacks started by Hays for Congress and supplemented by the DCCC in the past couple of weeks by trying to make a connection between Hill’s $250 donation to Martha Shoffner and his bank’s business – all legal – with the state treasurer’s office.

The newest ad from the DCCC kicks this up a notch by directly attacking Delta Trust & Bank, where Hill served as CEO.

“Who is French Hill looking out for?” asks the new ad. “Hill and others at his bank donated to the corrupt State Treasurer. Then taxpayer money directed to his bank increased 800%. Then Hill’s bank has been fined thousands for illegal investment sales. They even push risky reverse mortgages on seniors – schemes the AARP says could lead straight to foreclosure.”

It is hard to even know where to begin with this bit of absolute nonsense.

First, as has been repeatedly pointed out over the last few days in the press, Delta Trust had no involvement in the scandal which took down Martha Shoffner – a member of Hays’ and the DCCC’s party I will point out. The scandal involved a completely separate bond broker.

The taxpayer money that the ad claims was “directed” to Delta Trust was actually the total amount of bond purchases. The state purchased these bonds as an investment on which they earned interest and received this interest and principal back when the bonds matured or were sold. Delta Trust made a commission on this – again legally – but did not get to keep the money as the ad seems to imply.

These new charges are way out there. The ad segues straight into accusing the bank of being “fined thousands for illegal investment sales.” The ad offers no citation for this charge so I do not know where it is coming from. It implies that it has to do with Shoffner, which of course is completely false.

It also implies that selling reverse mortgages is somehow an attack on seniors. It seems to try to play up the worn-out playbook of how Republicans are mean to seniors with this odd bit of nonsense. Reverse mortgages may or may not be a good deal for some people, but they are hardly scandals and certainly not illegal.

The ad takes what was already an absurd line of attacks and brings it up to the point of slander. I would not at all be surprised if this ad ends up attached to a lawsuit. The DCCC is risking being sued with these blatant distortions of the truth and may even have violated state law.

Hays needs to unequivocally disavow this ad immediately. This potential slander against an Arkansas bank should not be tolerated. If he does not have the courage to do this, he has no business representing Arkansas in Congress.

If he can’t stand up to the DCCC on this outright attack on a business in the district he seeks to represent, then he is proving he is incapable of standing up for Arkansans in Washington.

UPDATE – I heard back from David Bergstein with the DCCC as to what they were referring to in the ad when they state – “Hill’s bank has been fined thousands for illegal investment sales.”

“In September 2004, Delta Trust Investments Inc. sold securities in North Dakota while not registered as dealers and agents in the state. As a result, Delta Trust Investments Inc. paid a $2,000 civil penalty. According to a FINRA BrokerCheck Report, Delta Trust Investments and its agent sold securities in North Dakota while it was not registered as a dealer and while its agent was not registered,” said Bergstein, who pointed to this report from the Financial Industry Regulatory Authority which regulates broker dealers.

A few notes notes here showing how bogus this claim is.

First, this is the only regulatory event that FINRA shows in their entire history for Delta Trust. That is extremely low for a broker dealer.  How low? Of the top 15 broker dealers in Arkansas researched by The Tolbert Report on FINRA website’s “Broker Check,” Delta Trust Investments is the only one that has only one regulatory event. THE ONLY ONE! The average for these 15 broker dealers is just over 92.

Translation – Delta Trust has the cleanest record with FINRA of any of the top Arkansas broker dealers and the DCCC is attacking them for it.

Here is the note from the FINRA report on the 2004 event showing a pretty reasonable explanation.

“Client is a personal friend of agent and frequently moves due to his job. Client’s address was changed to North Dakota without compliance notification. When compliance realized that trades had been done in a state that the firm was not registered in, trading was stopped until registration could be made,” says the report.

So a client moved to North Dakota where Delta Trust was not registered. When they realized the mistake, they paid the fine, registered in North Dakota, and offered to rescind the trades.

Also, note that this was in 2004. It not only had nothing to do with Martha Shoffner’s scandal – as the ad tries to imply with their false timeline – but took place before she was even elected.

In addition to all this, the AARP is not pleased with the unauthorized mention of their organization in the ad. This is a trend.  Businesses such as Blue Bell were upset with Hays using them in one of his ads – way back when his ads were still positive.

But this latest attack on Hill’s former bank is a completely bogus claim on what appears from FINRA to be the cleanest bank in the state.

It’s all being done in an attempt to smear French Hill. Again, Hays should renounce this ad immediately and loudly.