A federal judge on Friday rebuffed prosecutors’ last-minute attempt to add 10 new charges to those on which former state Treasurer Martha Shoffner is scheduled to be tried beginning March 3.
U.S. District Judge Leon Holmes granted defense attorney Chuck Banks’ request to separate the 10 new charges, handed up last week by a federal grand jury, from the 14 charges on which Shoffner was indicted in May and for which she has been scheduled for the March jury trial since July 9.
He said a separate trial will be scheduled for a later date on the new charges.
“Contrary to the government’s argument, Shoffner is not required to give up her right to a speedy trial on the fourteen counts previously charged in order to avoid being forced to trial without time to prepare against new charges,” Holmes wrote in a two-page order on Friday, after conducting a telephone conference with attorneys.
The original charges accuse Shoffner, 69, a Democrat from Newport, of accepting $36,000 in cash payments from an unnamed bond broker in return for steering much of the state’s bond business toward him. The charges cover a period of time beginning in mid-2010 and ending in May, when she was arrested. They consist of six counts of extortion, one count of attempted extortion and seven counts of accepting a bribe.
The latest charges are 10 counts of mail fraud and accuse Shoffner of using $9,800 in contributions for her re-election campaign to pay off personal credit-card debts for items including clothing and cosmetics. They cover 10 credit-card payments made between Nov. 5, 2010, and Oct. 9, 2011, although the indictment accuses her of devising a scheme to illegally use the campaign funds starting in October 2009, when she opened a bank account in the name of the campaign fund.
Banks said Friday after Holmes issued the order, “We’re pleased to get it, and we’ll move forward.”
U.S. Attorney Christopher Thyer said through a spokesman that he had no comment on the order.
In dueling motions filed earlier this week, Banks called the timing of the new charges so close to the trial date “disappointing and unreasonable,” and prosecutors responded that the new charges stemmed from documents that were only recently obtained. They said they wouldn’t object to the trial date being postponed.
Banks, who has said Shoffner is ready to get the trial over with, complained that the mail-fraud charges unfairly added a new dimension for which she hadn’t prepared. He said the new charges could prejudice her by inviting jurors to make “impermissible inferences” about separate allegations involving money.
Prosecutors responded that both sets of charges overlapped in time and constituted part of a “common scheme or plan.”
In his order Friday, Holmes wrote that if joining two groups of charges appears to prejudice Shoffner, the federal rules of criminal procedure permit the court to order separate trials. He then noted, “Here, requiring Shoffner to go to trial on the ten counts of mail fraud on March 3 would certainly prejudice her inasmuch as she has not had an opportunity to prepare to defend against these charges.”
Shoffner became the first state treasurer to resign the office when she stepped down on May 21 after six years in office. That was the day after a federal complaint was filed accusing her of accepting cash payments of at least $36,000, as well as $6,700 in cash campaign contributions, from the unnamed broker on multiple occasions, most recently being the preceding weekend, when it said FBI agents surreptitiously listened in as the broker, working as a confidential informant, delivered an apple pie to her house in a box in which he had placed $6,000 in cash.
The treasurer’s office manages more than $3 billion in investments for the state and serves as the board of trustees for the Arkansas Public Employees Retirement System, Arkansas Teacher Retirement System and Arkansas State Highway Employees Retirement System. The criminal complaint was filed more than four months after Shoffner told lawmakers that she hadn’t received any compensation from a Russellville-based bond broker or other brokers that do business with the state.
The questions arose after legislative auditors said the treasurer’s office purchased $1.69 billion in bonds from broker Steele Stephens from May 2008 through May 2009, when he worked at Apple Tree Investments, and from June 2009 to May 2013, while he worked at St. Bernard Financial Services of Russellville. They said the amount is double the amount that theoffice purchased from any other broker during that time.
Shoffner, however, told lawmakers that her office “didn’t consciously show preference” to the broker who had received more business than the others. But her chief investment officer, Autumn Sanson, disputed that, telling lawmakers that Shoffner instructed her to do more business with St. Bernard.
Prosecutors have said Shoffner was partially motivated by her struggle to pay the rent on a Little Rock apartment in 2011, after years of living rent-free since taking office in 2006, in a house downtown that a Texas lawyer used as an office. Shoffner moved to another Little Rock apartment after the lawyer allowed the building to go into foreclosure because his firm didn’t use it anymore.
The FBI has said in court documents that the broker paid Shoffner $6,000 about every six months so she could pay what she said was her $1,000-a-month rent. Although Shoffner owned a home in Newport, she had made frequent remarks about not being able to afford a home in Little Rock to avoid a daily 90-mile commute, according to a witness’s account cited in court documents.
As treasurer, Shoffner was paid $54,304 a year.
On May 31, after the criminal complaint was filed but before a federal grand jury had reviewed her case, Shoffner appeared before Holmes with the intention of pleading guilty to a single count of extortion. Holmes ended up not accepting the plea, however, when Shoffner refused to admit that she had any intention to commit a crime when she accepted money from the broker.
The following week, prosecutors took her case before a grand jury and she was indicted on the 14 charges.
Front Section, Pages 1 on 02/15/2014