The Broker-Dealer Regulatory Record

Arkansas Securities Department and FINRA records on the for-profit broker-dealer through which Arkansas state-government sovereign debt purchases have flowed — and why A.C.A. § 24-2-618(e) applies.

The bonds at the center of this investigation are not sold through ordinary fixed-income channels. They are sold exclusively, in the United States, through a single for-profit broker-dealer (FINRA CRD# 11148). The Arkansas Securities Department’s records on that broker-dealer — obtained through our Round 4 FOIA response on April 20, 2026 — establish a regulatory history that bears directly on Arkansas’s prudent-investor rule, including its single-agent / exclusive-agency provision at A.C.A. § 24-2-618(e).

The Arkansas registration

The broker-dealer’s Arkansas registration became effective June 25, 1984. By its terms, the registration scope is limited to a single category of instruments. The Web CRD records describe the registered scope as “BONDS FOR THE STATE OF ISRAEL” — the verbatim filed text.

That single-issuer scope is unusual in the broker-dealer registration regime. The Arkansas Securities Department records confirm only two other states (North Dakota and Arizona) have registered the same broker-dealer with the same single-issuer scope. In every other state where the broker-dealer is registered, the registration is general — covering the full range of instruments the firm is authorized to sell.

For Arkansas pension fiduciaries, the structural consequence is straightforward: when a fiduciary selects the underlying instrument, the fiduciary is simultaneously selecting this broker-dealer as the exclusive agent for the transaction. There is no competitive market channel and no alternative broker-dealer through which the same instrument can be acquired in Arkansas.

The 1986 suspension

On April 1, 1986, the Arkansas Securities Department issued Order 86-27-S suspending the broker-dealer’s Arkansas registration for failure to designate a principal. The order was signed by then-Securities Commissioner Beverly Bassett. The suspension was vacated on July 22, 1986 after the broker-dealer cured the deficiency.

The 1986 suspension is not a present-day disqualification. It is, however, part of the regulatory record an Arkansas pension fiduciary should be expected to have reviewed as part of the “extraordinary care and caution” A.C.A. § 24-2-618(e) requires when entering an exclusive-agency arrangement.

The FINRA disclosure events

FINRA’s Current Disclosure Summary for the broker-dealer records four regulatory occurrences spanning 1983 through 2014:

  • 1983 — SEC currency reporting matter.
  • 1984 — North Carolina consent order on selling securities while unregistered in that state.
  • 1997–98 — NASD action for operating with an unregistered principal; the broker-dealer paid a $9,500 fine.
  • 2014 — Control affiliate disclosure.

In 2000, NASD granted the broker-dealer special accommodations on the suitability requirements otherwise applicable to its sales activity, citing in the regulatory record that the firm’s customer base is “basically limited to those who have some religious, cultural or ideological affinity for Israel.” Full regulatory record (PDF).

A suitability accommodation premised on customer affinity is not, on its face, a determination of investment merit. Arkansas’s pecuniary-factors standard requires the opposite: an evaluation made on financial-effect factors, set apart from affinity.

The Arkansas-registered agents

The Arkansas Securities Department records identify three currently Arkansas-registered agents of the broker-dealer: Jacqueline Rady Miron, Nir Chaim Fisher, and Samuel Libchaber. Mr. Libchaber holds the most recent Arkansas registration on file.

Why A.C.A. § 24-2-618(e) applies

Arkansas’s prudent investor rule at A.C.A. § 24-2-618(e) provides:

“Single agent or exclusive agency delegations by the trustees shall be discouraged, but, if the trustees enter into an exclusive agency delegation, the trustees shall have exercised extraordinary care and caution in selecting the exclusive agent.”

That provision has three operative elements:

  1. Single-agent or exclusive-agency arrangements are discouraged. This is the default posture of the statute. Trustees do not earn neutrality by entering into such arrangements; they earn additional scrutiny.
  2. If trustees enter into one, they must have exercised “extraordinary care and caution.” “Extraordinary” is the statute’s word. It signals a heightened standard above the ordinary care otherwise required of a prudent investor under §§ 24-2-610–619.
  3. The standard applies to the selection of the exclusive agent — not only to the merits of the underlying instrument.

A pension fiduciary acquiring instruments offered through this single broker-dealer is entering an exclusive-agency arrangement within the meaning of § 24-2-618(e). The regulatory record summarized above is, at minimum, the record a fiduciary would need to demonstrate having reviewed in order to satisfy the statute’s “extraordinary care and caution” element. The FOIA productions to date establish that no such review is documented at any of the adopting Arkansas state-government entities.

The Pension Investment Transparency Act addresses exactly this gap. PITA’s five procedural provisions — independent credit analysis before purchase, written risk/return/liquidity comparison, secondary-market disclosure before a vote, written fiduciary pecuniary-factors determination, and public posting within thirty days — produce the contemporaneous record § 24-2-618(e) implicitly demands when an exclusive-agency arrangement is entered into.