The Auditor's Office as Pension Investment Channel

An office with no investment authority over Arkansas pension funds played at least seven documented operational roles in the bond issuer's sales pipeline. The FOIA record establishes the office's function as access intermediary.

The Arkansas Auditor of State is a constitutional accounting office. Under Arkansas law, the Auditor has no investment authority over the Arkansas Teacher Retirement System (ATRS), the Arkansas Public Employees’ Retirement System (APERS), or the State Treasury. The Auditor does not manage pension assets, does not sit on pension investment committees, and plays no formal role in the Treasury’s bond purchases.

The FOIA record, however, establishes that during the period covered by this investigation, the Auditor’s office served as the principal coordination point for the bond issuer’s institutional sales activity inside Arkansas state government. The office played at least seven documented operational roles in that activity.

Seven documented operational roles

1. Multi-official scheduling. On April 11, 2025, Auditor Dennis Milligan and Executive Assistant Wendy Spadoni sent four meeting-arrangement emails within eighteen minutes — scheduling the issuer’s national managing director and southeast regional executive director with the directors of APERS and ATRS, with the State Treasurer, and with the APERS Investment Finance Subcommittee Chair. Every meeting was set in Room 230 of the State Capitol — the Auditor’s own office. A planner note in Spadoni’s calendar dated March 31, 2025 — “★ Larry Berman trip 13th 14th or 15th” — corroborates pre-planning.

2. APERS-board introduction. Auditor’s-office deputy Jason Brady sits on the APERS Board of Trustees as the Auditor’s appointee. At the May 15, 2025 APERS Investment Finance Subcommittee, Brady introduced the bonds to the board, telling members “it had come to his attention” that the instrument was available and citing the State Treasury’s $55 million in existing holdings as a precedent the pension system might follow.

3. Correspondence drafting. The Auditor R2 production confirms that Brady drafted formal Milligan correspondence on the bonds — including the April 7, 2025 letter to State Senator Jim Dotson, then the Senate Co-Chair of the Joint Committee on Public Retirement and Social Security Programs.

4. National-network speech preparation. Brady also drafted Milligan’s April 24, 2025 Spring National Meeting speech for the State Financial Officers Foundation (SFOF). The full SFOF-pipeline context appears at /findings/sfof-pipeline/.

5. Internal-communications relay. The Auditor R2 production records that on the evening Mark White sent the ATRS Board a heads-up about the Arkansas Times investigation, Brady forwarded that internal communication to Milligan’s personal AOL email address — routing state business outside official state email — and forwarded the same chain the next morning (a Saturday) to Communications Director Stacy Peterson.

6. Press-response coordination. When Arkansas Times reporter Jennifer Lenow sent APERS a request for comment about the sovereign bond authorization, APERS Executive Director Amy Fecher’s first action was to forward the inquiry to Brady at the Auditor’s office, with Spadoni copied. The FOIA record places the Auditor’s office in the de facto role of media-response coordinator for APERS — an agency over which the Auditor has no statutory authority.

7. Public-facing video production. Auditor’s-office video producer Kurt Underwood produced an “I stand with Israel” YouTube video published on October 7, 2024. The same Auditor’s-office video apparatus hosted the April 16, 2025 SFOF video recording session referenced in the SFOF pipeline.

The senior-leadership tier

The Auditor’s-office coordination on the bonds and on SFOF activity is not limited to Milligan and Brady. The FOIA productions identify a parallel functional tier:

  • Wendy Spadoni, Executive Assistant to the Auditor — orchestrator of the April 2025 Capitol tour and the issuer’s primary day-of-trip contact.
  • Kristina Duke, Assistant Chief of Staff to the Auditor.
  • Melissa Corrigan, Chief of Staff to the Auditor — senior leadership coordinating SFOF communications and the issuer’s engagement tracking.
  • Stacy Peterson, Director of Communications to the Auditor — designer of the October 2024 public-facing solidarity campaign and coordinator with Brady on the SFOF Spring speech.
  • Kurt Underwood, video producer.
  • T.J. Fowler, General Counsel — formal legal authority over Auditor FOIA responses.

The Auditor’s-office org chart relevant to the investigation is documented in full at the wiki source page on Auditor’s Office Senior Leadership Structure.

What the pattern means for the fiduciary record

The Auditor’s office is not within the Act 498 fiduciary chain. Pension benefit plan trustees and treasurer’s-office officials are. But the operational record matters for fiduciary review under A.C.A. § 24-2-611(d), which requires trustees to “make a reasonable effort to verify facts relevant to the investment and management of trust assets.”

When the primary information channel reaching a pension board on a particular instrument is an office with no investment authority — staffed by a single individual (Brady) who is simultaneously a member of the board receiving the introduction — § 24-2-611(d)’s “reasonable effort to verify facts” requires a fiduciary record reflecting independent verification through other channels. The FOIA productions do not document such a record at the adopting agencies.

The Pension Investment Transparency Act is designed to produce exactly the verification record § 24-2-611(d) implicitly demands: independent credit analysis from the fund’s own consultant or staff before purchase, written comparison against alternatives, board-material disclosure of liquidity characteristics, a written fiduciary determination of pecuniary-factors compliance, and public posting within thirty days.