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Wednesday, May 22, 2013

Salesman in Shoffner probe resigns from securities firm

Posted By on Wed, May 22, 2013 at 9:11 AM

Steele Stephens, the securities salesman whose large share of state Treasurer Martha Shoffner's state bond investments triggered a federal investigation that led to a criminal charge against her, yesterday submitted a resignation by fax to his employer, St. Bernard Financial Services, based in Russellville.

Robert Keenan, chief executive officer of the firm, said Stephens, who worked from an office in his Little Rock home, did not state a reason for his resignation and did not talk to him. Keenan said he'd notified securities regulators of Stephens' departure from the firm. He left blank the reason for his departure on the required reporting form, except to say the departure was "voluntary," because he said he could only speculate as to motivation.

Keenan continues to believe, as he told me yesterday, that Stephens was the as-yet unnamed confidential informant who was wired with surveillance equipment in a visit to Shoffner's house last Saturday in Newport. The informant delivered a pie in which $6,000 in $100 bills was hidden, the sixth in a series of similar payments that a federal extortion charge said were made in return for significant bond business. Two well-placed sources have told me Stephens was the informant. He has not responded to requests for comment. The cooperating witness was given immunity from federal prosecution for help that began in January 2012. We first reported on the unusual concentration of Shoffner's bond business in October 2011.

Steele Stephens' resignation came about the same time as Shoffner's resignation from her $53,000 state job, a term that runs through 2014. Gov. Mike Beebe will appoint a replacement to complete the term. It's not yet clear how soon that appointment will be made.

I asked Heath Abshure, the state securities commissioner, about the resignation. He said it doesn't end his agency's review of whether a securities salesman made payments to Shoffner and whether the salesman's firm knew about it. The Securities Department has a one-period in which to act against a licensee, even when no longer working.

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