# State Treasurer's-Office Israel Bonds Operational Pathway The Arkansas State Treasurer's office Israel Bonds operational pathway is documented end-to-end in the Treasury R1 (7-7-25) production for the May 2025 Thurston $20M purchase, with cross-confirming partial documentation of the November 2023 Walther $10M transaction. The pathway involves seven discrete operational principals across three institutions, follows a documented sequence of approximately six stages, and produces both a DCI-side Order Approval document and a BNY-side custodial holdings statement. ## The operational principals **Treasurer's office (the institutional purchaser):** - **Steve Pulley**, Senior Investment Officer (the order-placer) - **Celeste Gladden**, wire operations (executes the wire to BofA) - **Bill Huffman**, Chief Deputy Treasurer (target-setter; signs QIB Accredited Investor letter for Rule 506 compliance) - **Steven Kilgore**, Investment Accounting Director / Internal Audit (custodial policy review) **DCI (the institutional seller):** - **Lawrence Berman**, National Managing Director (sales pitch; rate sheet transmission) - **Bill Mulvey**, VP Operations (Book Entry custodial migration; sample statements; APERS coordination) - **Mark Ng**, Registered Principal Associate Director Central Processing (Computershare wire reconciliation) - **Steven Hill**, Operations Approver (signs the Payment Validation after wire clears) **Custodial chain:** - **Bank of America** (Treasurer's-office wire bank; New York routing per the standard DCI wire instructions, ABA 026009593) - **Computershare Trust Company N.A.** (DCI's fiscal agent; receives the wire at Bank of America NY) - **BNY (Bank of New York)** with the **DTC vault** (Treasurer's-office investment custodian for certificate-format bonds prior to April 2025 Book Entry migration) - **Computershare IsraelBondsDirect platform** (DCI's recordkeeping platform after April 2025 Book Entry migration) ## The six operational stages (May 2025 Thurston purchase) **Stage 1: DCI sales pitch.** Berman emails Pulley directly with a rate sheet. The 4/16/2025 12:06 PM Berman email to Pulley: > Hi Steve, I've attached our current institutional rates for your review. > > I just talked to Bill Huffman, and he told me you were planning to bring the portfolio up to $55M, with the purchase of 3 and 5 year paper. That would be a total purchase of $20M. Attached: April 15th - April 30th 2025 Rate Sheet, 12th Series Institutional Offering Circular January 2024, Wiring-Instructions-(1).pdf, 2024 Accredited Investor Letter. The pitch includes pre-conversation target ratification (Berman has already spoken to Huffman about the $55M target) and pre-supplied compliance documentation (the QIB letter for Pulley to fill out). **Stage 2: Treasurer's-office order placement.** Pulley emails Berman back with the discrete bond positions to purchase. The 4/16/2025 2:20 PM Pulley reply: > Hey Larry, thanks for all of the information on the current issue. Pencil us in for $10MM of the 3yr 4.66% along with $10MM of the 5yr 5.17%. Did you need us to update the QIB? The order matches Huffman's pre-conversation target exactly: $20M total in 3+5 year structure. Pulley's order is sent four hours after Berman's pitch. The wiki has no documentation of any internal Treasury investment-merits review between the pitch and the order; the documented record shows Pulley moving from receipt of the pitch directly to order placement. **Stage 3: QIB Accredited Investor compliance.** Pulley emails Huffman the Accredited Investor Letter for signature (4/21/2025 9:04 AM). Huffman signs (4/21/2025 9:14 AM acknowledgment via Outlook for iOS). Gladden transmits the signed letter to Berman (4/22/2025 10:47 AM): > Larry, Please see our Accredited Investor certification, attached. The QIB Rule 506 private placement compliance step. The 12th Series Institutional Bonds are sold only to qualified institutional buyers per the SEC private-placement exemption; the QIB letter attests Treasurer's-office accreditation status. **Stage 4: Treasurer's-office wire to Bank of America.** Gladden initiates the wire to Bank of America in New York per the DCI wire instructions: | Field | Value | |---|---| | Bank Name | Bank of America | | Bank ABA | 026009593 | | Bank Address | 100 West 33rd Street, New York, NY 10001 | | Account Name | Computershare Inc.aaf SOI Wire Purchase account | | Account Address | 150 Royall Street, Canton, MA 02021 | | Reference | Purchaser Name and Bond Type | The wire is sent for May 1, 2025 settlement (Berman: "I've attached wire instructions for May 1 as well"). The May 2025 wire is documented as successfully completing without the November 2023 BofA hold difficulty. **Stage 5: DCI Operations Approval.** Once Computershare receives the wire, DCI's internal Order Management System generates the Payment Validation document. The 5/5/2025 Payment Validation document (Order ORD-2087155) carries Operations Approver "Steven Hill" signature and "Approved" status. Two bonds documented: | Pay Date | Issue Date | Denomination | Amount | Report Number | |---|---|---|---|---| | 05/01/2030 | 05/01/2025 | 1 @ $10,000,000.00 | $10,000,000.00 | 2025-667-12IIB05FX-2193057-1 | | 05/01/2028 | 05/01/2025 | 1 @ $10,000,000.00 | $10,000,000.00 | 2025-667-12IIB03FX-2193057-2 | The Report Number encoding "12IIB05FX" reads as "12th Series Institutional Investment Bond, 5 year, Fixed" — the bond product taxonomy is preserved in the report number string. The CAT 50 designation is consistent across both bonds; CAT codes are DCI's internal bond classification system. **Stage 6: Custodial recordkeeping.** Per the wiki's prior documentation at [[state-treasurer-israel-bonds-holdings]], the Thurston purchase appears in the Treasurer's-office Computershare statement dated 5/5/2025 (the sample statement Mulvey sent to BNY/APERS on 6/30/2025) as CUSIPs 46514X2P3 (3Y) and 46514X3P2 (5Y). The April 2025 Book Entry custodial migration (Kilgore's policy-review concurrence; Mulvey's coordination) was completed before the Thurston settlement, so the new positions are held in Computershare's IsraelBondsDirect Book Entry format rather than in BNY's DTC vault as physical certificates. ## The November 2023 Walther transaction (operational difficulty case) The 11/1-11/2/2023 wire-pending email thread documents a partial operational pathway for the Walther $10M purchase that experienced operational difficulty between Stage 4 and Stage 5. The thread chronology: - Stage 1-2 are not in the present production (the Walther order placement occurred prior to 11/1/2023) - Stage 4 (Treasury wire): Gladden released the $10M wire 11/1/2023 at 10:57 CDT - Wire status check: Berman 11/1/2023 4:18 PM: "Hi all, as of 4:36EST we still did not see the wire at Computershare" - Reconciliation: BofA confirmed wire was sent but with a "DOMESTIC WIRE HOLD" status: 11/2/2023 03:04 AM the wire finally cleared - Mark Ng coordinated Computershare-side acceptance after the deadline - Berman's 11/2/2023 11:41 AM post-event message: "Thanks to Bill and Mark, we were able to get Computershare to accept the wire even though it came in after the contracted deadline for wires" - DCI institutional pressure: Berman 11/1/2023 1:58 PM: "If not received today, have to cancel the transaction" The Walther transaction documents that Stage 4 wire execution carries operational risk: BofA may place a fraud-prevention hold on a $10M outgoing wire (Gladden: "in the past I have seen this is done in relation to fraud prevention and is out of our control"); the hold can take up to 12+ hours to clear; Computershare's deadline window is the same calendar day; without active cross-team reconciliation under DCI deadline pressure, a wire hold could result in transaction cancellation. The Walther transaction succeeded after the cross-team intervention by Berman, Mulvey, Mark Ng, Pulley, Gladden, and presumably Treasury-side BofA contacts. The Thurston May 2025 transaction did not encounter this difficulty. Berman's 11/2/2023 post-event "Let's keep this in mind for the any future transactions, and maybe wire a day early to avoid the same problem" advice may have been incorporated. ## Documented pathway gaps The Treasury R1 batch does not document several pathway components that would complete the operational picture: - **Pre-Stage 1 internal Treasury review.** The wiki has no documentation of any Treasury investment-merits review of the Israel Bonds product (credit assessment, alternatives analysis, allocation analysis) preceding the Berman pitch. The 10/8/2024 "Israel Internal Credit overview" document Pulley sent McKim as a FOIA-response attachment in December 2024 may contain such material, but the document text is not in this production. Whether any 2025 update of internal credit overview preceded the Thurston purchase is not documented. - **SBOF approval.** The State Board of Finance is the Treasurer's-office investment oversight body. The May 2025 Thurston purchase is reported to SBOF after the fact in the 5/12/2025 prepared remarks ("we have purchased Israeli bonds in amounts consistent with our historical levels"); whether SBOF approval was required or whether the Treasurer's office acts under standing delegated authority for Israel Bonds purchases is not documented. The 4/17/2025 Kilgore SBOF custodian-policy review was operational/administrative on the Book Entry migration, not on the underlying purchase decision. - **Documented decision authorization at the Treasurer or designee level.** The order chain documents Pulley placing the order and Huffman signing the QIB letter. Whether Thurston personally authorized the $20M target before Huffman conveyed it to Berman, or whether Huffman acted at his own discretion, is not documented in this batch. - **The wiring-instructions account number** (the Computershare account number at Bank of America) is redacted in the present batch. The reference field convention "Purchaser Name and Bond Type" appears to be the standard cross-institution identifier. ## The Milligan-era operational pathway (Sub-batch 2 extension) The Treasury R2 Sub-batch 2 Israel Purchases production extends the operational pathway documentation backward to the Milligan-era 2018-2021 transactions. The pathway template (DCI sales pitch → Treasurer's-office order placement → QIB compliance → wire to Bank of America → DCI Operations Approval → custodial recordkeeping) was structurally consistent across the Milligan-Walther-Thurston eras with three substantive variations: (1) **The order-placer role rotated across Treasurer eras.** Brady (Chief Deputy Treasurer-Operations) placed Milligan-era orders 2019-2021; Pulley (Senior Investment Officer) replaced Brady's order-placer function from the Walther November 2023 transaction onward. Sanson (Chief Investment Officer) placed the January 2019 $30M order before Brady fully assumed the Treasury role. The Treasurer's-office order-placer identity is therefore not stable across Treasurer eras; the operational pathway tracks the office (Chief Deputy Treasurer / Senior Investment Officer) more than the individual. (2) **Custodian changed from Bank of America Merrill Lynch to Bank of New York Mellon between October 2021 and April 2023.** Milligan-era purchases (2018-2021) used Bank of America Merrill Lynch Global Custody and Agency Services (Chicago office; contacts Rick Ledenbach 2018, Mirza Omercajic 2020-2021, Robert Godoy / Andrew Phillips 2021). Lowery-era onward (April 2023+) used Bank of New York Mellon Global Custody (Pittsburgh PA office; contacts Jeffrey Marcus, Arnold Dorville, Paul Mastros). The BofA-to-BNY transition spans the Lowery interregnum. (3) **The custodial format evolved from physical certificates to book entry.** 2018-2021 Milligan-era purchases were physical certificates held in the custodian bank's vault (BofA Chicago, later DTCC Vault). 2023+ purchases continued to use physical certificates in DTCC Vault until the April 2025 Book Entry migration that Pulley coordinated with Mulvey. The Thurston May 2025 purchase is the first Treasury Israel Bonds purchase issued directly in Book Entry format (held in Computershare's IsraelBondsDirect platform rather than in any custodian bank's vault). ### The Milligan-era order-placement template Brady's Milligan-era order-placement emails followed a consistent template across four documented transactions (January 2020, May 2020, February 2021, October 2021). The 1/21/2021 11:40 AM Brady order: > [!evidence] Israel Purchase 02-01-2021_Redacted.pdf p.14, 1/21/2021 11:40 AM > Larry: per our conversation on Tuesday, the State of Arkansas / Treasurer of State would like to put in for the following: $5MM of the 5 year Jubilee Fixed Rate Institutional Bonds (8th Series) at 1.35%; $5MM of the 3 year Jubilee Issue Bonds (11th series) at .73%. If I did this correctly, I'll get out of the middle and let Celeste and your wonderful team complete this order/request. As always, Treasurer Milligan appreciates the opportunity to stand with and invest in Israel. God Bless – Jason Brady's template ("I'll get out of the middle and let Celeste and your wonderful team complete this order") explicitly delegates Stage 4 (wire execution) and Stage 5 (operations approval coordination) to Gladden as Investment Manager. The Sanson-to-Gladden Investment Manager transition was complete by January 2020 per Gladden's signed BofA custodial letters; Sanson's role as Chief Investment Officer ended sometime between January 2019 and early 2020. Brady's "stand with and invest in Israel" closing rhetorical formula appears in the January 2021 order and propagates across the wiki's documented 7-year period: Walther's October 2023 press release ("Arkansas stands with Israel"), McKim's October 2024 Israel Prayer Ceremony draft, Milligan's October 2024 Capitol Rotunda speech, Brady's 2024-2025 ATRS and APERS outreach. ### The Berman-Brady-Milligan personal relationship The Milligan-era Sub-batch 2 emails document the substantive personal closeness of the Berman-Brady-Milligan working relationship. Berman's 1/21/2021 11:55 AM reply to Brady's February 2021 order: > [!evidence] Israel Purchase 02-01-2021_Redacted.pdf p.14, 1/21/2021 11:55 AM > Jason, you did it right, and thank you very much! We remain very grateful to Treasurer Milligan and your great team for your continued support and investment in the State of Israel. I likewise will get out of the way and leave our side of the transaction to our experts, Luis. Bill, and Brad. I know Celeste and Luis have worked in concert in our past transactions. > > Thanks again for the order. Hope to see you in person soon! You, Grant and of course Treasurer Milligan, have an open invitation to visit Rose and me here in New Orleans! Y'all welcome anytime! See, I'm learning! Berman's personal "Y'all welcome anytime" New Orleans invitation to Brady, Wallace, and Milligan; Berman's reference to "Treasurer Milligan and your great team"; Berman's first-name basis ("Larry") in Brady's salutations across all four Milligan-era order emails — all document the personal closeness of the Berman-Brady-Milligan working relationship that the seed-list framed as Milligan's "long-standing personal relationship with Lawrence Berman." ### The October 2021 in-person NYC visit Brady's 10/4/2021 6:00 AM order email opens: "Robert and Celeste: We need to follow up with Luis at IB today to purchase the bond/s offered us last week while in NYC." The "while in NYC" reference establishes that Brady, Romanik, and Gladden traveled to New York City in late September or early October 2021 and met Luis Jimenez personally at DCI's 641 Lexington Avenue headquarters. This is the first wiki-documented in-person Treasury-DCI face-to-face meeting; the operational pattern is replicated four years later in the April 14-15, 2025 multi-official Capitol tour Brady orchestrated from his Auditor's-office role. ### The maturity disposition pattern All six Sub-batch 2 documented Treasury Israel Bonds maturities follow the same operational disposition pattern: maturity proceeds returned to the Treasury general account at the custodian bank, NOT directly rolled into new Israel Bonds purchases. | Maturity Date | Amount | Treasurer Era | Disposition | |---|---|---|---| | 3/1/2020 | $20M | Milligan | Returned to Treasury BofA account; pre-funded by 1/15/2020 $20M new purchase per Brady's "we will NOT reinvest" explicit policy | | 1/1/2021 | $30M | Milligan | Returned to Treasury BofA account; not reinvested in Israel Bonds | | 5/1/2023 | $8M | Lowery | Returned to Treasury BNY account (custodian transition documented); not reinvested in Israel Bonds | | 2/1/2024 | $5M | Walther | Returned to Treasury BNY account; not reinvested in Israel Bonds | | 1/1/2025 | $10M | Thurston-transition | Returned to Treasury BNY account; not reinvested in Israel Bonds (memo-predicted) | | 5/1/2025 | $7M | Thurston | Returned to Treasury BNY account same day as $20M new purchase; new purchase financially distinct (memo-predicted) | The pattern supports the substantive framing that Treasury Israel Bonds purchase decisions are made independently of maturity events; maturity proceeds are returned to the general account and new purchases are made (or not made) from general account cash on the basis of a separate Treasurer or designee decision. Brady's 1/9/2020 1:28 PM order-placement email made the disposition pattern explicit five years before Pulley's 4/16/2025 order: "When the State of Arkansas' $20MM bond matures in March, we will NOT reinvest that amount since we are investing $20MM now." ### The maturity operational pathway (BNY era) The Walther-Lowery-Thurston era maturity pathway has five stages, parallel to the purchase pathway: 1. **Computershare maturity notice** (60+ days pre-maturity). Letter from DCI President & CEO (Israel Maimon through ~2022; Dani Naveh from ~2022 onward) to Treasurer's-office Investment Manager (Gladden) addressing the bondholder and inviting reinvestment. 2. **Gladden Letter of Instruction to BNY**. Gladden requests BNY withdraw the physical bond from the DTC Vault and ship it to Computershare for redemption. The letter is on Treasurer-of-State letterhead (Lowery 2023, Walther 2024, Thurston 2025) but signed by Gladden as Investment Manager. 3. **BNY ships bond to Computershare via FedEx**. Documented tracking numbers from the 2024-2025 maturities: 408540696105 (12/26/2024 shipment for 1/1/2025 maturity), 408540738572 (4/28/2025 shipment for 5/1/2025 maturity). Computershare Israel Bonds receiving contacts: Kerrie Vernava (through end-2024), Tanesia Morris (April 2025+). 4. **Gladden W-9 and redemption request to Computershare**. Treasurer's-office submits redemption request letter, W-9 (Arkansas Treasurer of State, signed by Gladden), and updated wire instructions. 5. **Computershare wires maturity proceeds to Treasury BNY account**. Net of redemption pricing per the bond's terms. The BNY-era maturity pathway therefore involves Computershare as the fiscal agent (issuing the bond, holding the registration, paying maturity proceeds), BNY as the Treasury custodian (holding the physical certificate in DTC Vault, releasing the certificate for redemption), and the Treasury Investment Manager (Gladden) as the operational principal coordinating both sides. ### Custodial transition documented contacts **Bank of America Merrill Lynch (2018-2021):** - Rick Ledenbach (2018), Global Custody and Agency Services, Bank of America Merrill Lynch, IL4-135-18-51, 135 South LaSalle Street, Chicago IL 60603 - Mirza Omercajic (2020-2021), Assistant Vice President, Global Custody and Agency Services, IL4-540-21-03, 540 West Madison Street, Chicago IL 60661, T 312-992-0609 | F 312-453-4443, [email protected] - Robert Godoy (2021), Associate, Account Manager, Phone 312-904-0748, [email protected] - Andrew Phillips (2021), Associate, Backup Account Manager, Phone 312-904-1838, [email protected] - Treasury Account Name: Treasurer State of Arkansas, Account Number 603186 - Trade Settlement Place: DTCC Vault (post-2020); BofA Vault (2018-2019) **Bank of New York Mellon (2023-present):** - Jeffrey D. Marcus, Corporate Actions, Global Portfolio Services, BNY, 500 Grant Street Room 151-2600, Pittsburgh PA 15258, T 412-234-8056, [email protected] - Arnold Dorville, Corporate Actions, BNY, [email protected] - Paul Mastros, Global Portfolio Services, BNY, [email protected] - BNY rebrand: "We've simplified our company umbrella brand to BNY" (from BNY Mellon) — completed during 2024 - Treasury Custody Account number: redacted in production ## Sub-batch 3 refinements ### The 2/3/2025 Berman escalation pattern (Pulley caution → Huffman supportive position) Sub-batch 3 documents the operational mechanic by which DCI routes around Treasury investment-staff caution to elected-Treasurer-appointed Chief Deputies. When Pulley's 2/3/2025 12:23 PM response to Berman's January reinvestment pitch was non-committal ("we are watching the situation with rates, tariffs and Fed policy to determine when to take advantage of our next buying opportunities"), Berman escalated 2 hours and 14 minutes later (2/3/2025 2:17 PM) to Burleson and Huffman without Pulley: > Hi Ken, Hi Bill, I wanted you to see Steve's response. Not sure exactly what's going on, but we had the best rates last period we've had in several months, and they continue to be solid today. Huffman's 2/4/2025 11:12 AM response closed the moment of caution: > I hope all is well. Thank you for the update. Our office continues to be supportive of your program. Steve and I have visited regarding buying opportunities. We look forward to continuing our relationship. Thank you. Bill. The escalation pattern documents an operational pathway addition: DCI bypasses the Senior Investment Officer's caution by routing to the Chief Deputy Treasurer (Huffman) and Deputy Treasurer (Burleson). The Chief Deputy's standing supportive framing operates as the Treasury-office position, ratifying the relationship even when the investment officer's analytical posture is cautious. Pulley placed the 4/16/2025 $20M Thurston order ten weeks later. The wiki adds the escalation pattern as a documented operational mechanic available to DCI when Treasury investment-staff response is non-committal. ### The Berman/Bradley Young November 2024 Little Rock visit (previously undocumented) Sub-batch 3 documents a previously-undocumented Berman/Bradley Young visit to Little Rock in November 2024. Berman's 12/23/2024 11:09 AM email references "when Brad and I were in town last month"; Berman's 4/17/2025 2:40 PM thank-you to Thurston confirms "After meeting Bill and Ken on our earlier trip to Little Rock, we knew that our partnership with the Arkansas Treasurers office was in capable hands." The visit met Bill Huffman (Chief Deputy Treasurer) and Kenneth Burleson (Deputy Treasurer) — Thurston-era Chief Deputy and Deputy. The November 2024 visit is the in-person predecessor to the 4/15/2025 Capitol meeting and to Huffman's 2/4/2025 supportive-framing email. The wiki adds the November 2024 visit to the documented Berman in-person engagement timeline: September 2021 NYC trip with Brady-Romanik-Gladden + Milligan; November 2024 Little Rock visit with Huffman/Burleson; April 2025 Capitol meeting with Thurston + team. ### The Thurston procedural correction on the 4/15/2025 meeting venue Sub-batch 3 documents Thurston's 4/12/2025 7:05 AM Saturday email correcting Milligan/Brady's framing of the 4/15/2025 Berman/Young Capitol meeting: > It appears there has been a miscommunication or misinformed assumption. At no time was I lead to believe this meeting involved the Auditor or that it was to take place in the Auditor's office. I spoke to Mr. Berman directly. I scheduled him to meet with the Treasurer and staff in our offices. Sandra Blount (Executive Assistant to Treasurer Thurston) confirmed the corrected Treasury Suite 220 venue to Berman 4/14/2025 with cover note "I apologize for any confusion." The procedural-correction documents that Thurston scheduled Berman directly, not through Brady, and pushed back on the Milligan/Brady framing of the meeting as an Auditor's-office event. The 4/15/2025 meeting occurred at Treasury Suite 220, not Auditor Suite 230. The wiki refines its prior framing of the 4/15 meeting (per Sub-batch 1) to capture the procedural friction over Auditor-versus-Treasury attribution. ### The Berman pre-approval pattern on Treasury press communications Sub-batch 3 documents that Berman pre-reviewed and approved the 10/27/2023 Walther press release on the November 2023 $10M purchase before McKim circulated to the internal Treasury team. Heather McKim's 10/27/2023 2:55 PM internal email: "By the way, Larry was good with it too, just wanted me to send it to you all. I will run any changes by him as well." DCI exercises editorial pre-approval on Arkansas Treasury Israel Bonds public communications. The press release Berman approved produced the framing the Wickline 10/28/2023 Arkansas Democrat-Gazette article reproduced (Sanders quote, Walther 1948-friendship-and-biblical-Christian-Zionist quote). The PR machinery activation following Pulley's 10/24/2023 12:12 PM order placement ran in hours, not days: 10/24 1:32 PM Munson SBOF remarks draft; 10/25 SBOF appearance; 10/25 11:42 AM McKim multi-state announcement list; 10/27 press release. Eric Munson's 10/23/2023 forward of the Texas Comptroller Hegar 10/13/2023 $20M Israel Bonds press release served as the contemporary model for Walther's framing. ### The Israel Ministry of Finance directive pattern Sub-batch 3 documents five instances 2019-2025 of Berman explicitly disclosing Israel Ministry of Finance directives to DCI on what to sell and at what spreads. The pattern documents that DCI's pricing and issuance are operationally subordinate to Israel Ministry of Finance directives. The "spreads" and "amounts" Berman pitches to Treasury staff are Ministry-directed, not market-derived. The pattern bears on the operational pathway in that Stage 1 (DCI pitch) is structurally Ministry-directed pricing pass-through; the rate spreads Treasury staff evaluate are not market-discovered prices but issuer-government-directed offering yields. ### The DCI exclusive-briefing pattern (Yali Rothenberg, January 2025) Berman's 1/7/2025 invitation to Pulley + Burleson + Huffman for an "exclusive briefing" with Israel's Accountant General Yali Rothenberg on 1/15/2025 documents direct DCI-Israel-government engagement with Treasury staff coincident with the post-1/1/2025-maturity reinvestment decision window. The briefing was substantively a sales context. The wiki adds the exclusive-briefing pattern as an additional Stage 1 mechanic — DCI bringing Israel-government officials to brief state-purchaser staff at decision-relevant timing, blending issuer-direct analytical content with sales pitch. ### Steven Kilgore's documented procedural-compliance review function Sub-batch 3 documents Steven Kilgore (Investment Accounting Director / Internal Audit) performing the internal procedural-compliance review function on Israel Bonds operational changes. Kilgore's 4/17/2025 12:55 PM SBOF policy review on the Computershare book-entry custody question concluded "I don't find a barrier to using Computershare for Israel bonds, assuming no ongoing fees are involved." The review covered SBOF Master Custodian policy interpretation, Broker-Dealer fee-arrangement assessment (Computershare as "agent or arm of the issuer"), and recordkeeping adequacy. The wiki adds Kilgore's procedural-review function to the operational pathway documentation: internal procedural compliance is reviewed by Investment Accounting Director / Internal Audit (Kilgore) when operational changes (custody method changes) require it; review is procedural-compliance, not substantive-investment-merits. ## Tensions This concept page is the documentary surface for one open tension: - [[T045 - Treasury 20-Year Pattern Institutional Operational Continuity vs Political-Statement Durability]] — is the twenty-year Treasury Israel Bonds pattern best characterized as institutional operational continuity (a normalized program operating across five elected-Treasurer transitions with structurally durable operational pathway), or as the durability of a political-statement purchase pattern operating outside normal Treasury investment-decision criteria. Statement A reads the cross-Treasurer-era pathway durability, the cross-political-party operational history (including Democratic-Treasurer-era Stubblefield purchases), the SBOF "consistent with our historical levels" framing, and the institutional-program characterization; Statement B reads the Dortch 12/6/2024 "political statement at the direction of the elected Treasurer" framing, the Brady-era "stand with and invest in Israel" order-placement rhetorical formula and its propagation across the 7-year wiki-documented record, the HOLD-vs-override pattern, and the 2/3/2025 Berman-escalation-around-Pulley-caution pattern as evidence of political-statement durability. Status: open. Related to [[T002 - Treasury HOLD Recommendation vs Subsequent Override]] at a different level of abstraction. - [[T047 - April 2025 Capitol Meeting Procedural Attribution Auditor vs Treasury Origin]] — was the 4/15/2025 Berman-Thurston meeting an Auditor-originated event within the broader Capitol tour Brady orchestrated, or a separately-scheduled Treasury-originated event Brady incorrectly attributed to the Capitol-tour framing. Statement A reads the Capitol tour as the operational frame with the Treasury-side scheduling as procedurally separate but operationally integrated; Statement B reads the Thurston 4/12/2025 procedural-correction email as dispositive on the categorical separation between the Auditor-coordinated tour and the Treasury-direct Berman meeting. Status: open. ## Cross-references [[treasury-foia-r1-7-7-25]] [[treasury-foia-r2-9-23-25]] source pages [[steve-pulley]] [[celeste-gladden]] [[bill-huffman]] [[steven-kilgore]] Treasurer's-office principals in the pathway [[lawrence-berman]] [[bill-mulvey]] [[mark-ng]] [[steven-hill]] DCI principals in the pathway [[bny]] Treasurer's-office investment custodian (BNY/DTC vault) [[state-treasurer-israel-bonds-holdings]] companion concept page on the resulting CUSIP-level holdings [[independent-credit-analysis-gap]] concept page; Stage 1-2 (DCI pitch → Pulley order placement) at the documented Thurston transaction proceeds without documented intervening Treasury-side credit review [[auditor-multi-official-capitol-tour]] concept page; the 4/15/2025 Berman-Thurston Capitol meeting is the Stage 1 precursor to the documented Thurston purchase ## Treasury R3 2-19-26 production: the Feb 17 2026 transaction pathway The Treasury R3 (2-19-26) production extends the documented operational pathway to a third Treasurer's-office Israel Bonds purchase: the Feb 17 2026 $10M 5-Year single-tenor transaction (Thurston purchase #2). The R3 transaction follows the same six-stage pathway as the May 2025 Thurston ladder transaction with three documented variants: (a) the Stage 1 DCI sales pitch is Berman cold solicitation on a specific maturity event (not a target-portfolio-level conversation pre-mediated by Huffman); (b) the Stage 2 order acceptance is faster (2h 12m vs ~4 hours); (c) Stage 5-6 (DCI Operations Approval and custodial recordkeeping) are presumably in book-entry form via the Computershare IsraelBondsDirect platform (the post-April 2025 default), but the operations approval document is not separately produced in R3. ### Stage 1: Berman cold solicitation on the 2/1/2026 maturity (1/14/2026 2:31 PM) Berman's email to Pulley (cc John Thurston, Kenneth Burleson, Bill Huffman, Bradley Young), Subject "Maturing Bond Feb 1-$5M": > [!evidence] Redacted communications.pdf, Berman to Pulley, 1/14/2026 2:31 PM > The State has a $5M Bond maturing on Feb 1 which we are hoping you will reinvest. I have attached our current Institutional rates above and am happy to answer any questions you might have. Please review and let's follow up in the next few days. If you decide to reinvest, I suggest you wire on Monday Feb 2, but by terms of our prospectus, you have until Jan 6th to wire funds and you will still receive a Feb 1 dated purchase with the rates above. > > ... If you are interested in buying the next bond in book entry form to avoid the extra paperwork, I'm happy to discuss that with you. Additionally, if you wanted to add funds to this maturity, we would of course be more than happy to discuss that as well! Attachment: 2026 Institutional Offering Rates January 15th - January 31st.pdf (the 13th Series rate sheet). The pitch follows two operational patterns: (a) **maturity-event-anchored solicitation** — the pitch is framed around the maturing 8th Institutional CUSIP 46514TZG6 $5M position; (b) **explicit upsell invitation** — "if you wanted to add funds to this maturity, we would of course be more than happy to discuss that as well!" The upsell pattern was operationally validated by Treasury's acceptance of a $10M new purchase against a $5M maturity. ### Stage 1.5: Jimenez offers funding-mechanism variant (1/14/2026 3:50 PM) Luis Jimenez forwards to Gladden with an alternative operational mechanism: > [!evidence] Redacted communications.pdf, Jimenez to Gladden, 1/14/2026 3:50:41 PM > Hi Celeste, Just wanted to make sure you know there was an option for the State to reinvest without exchanging funds. If you'd like to reinvest the upcoming maturing bond then we can use the bond as the funding for the new bond. Let me know and I can complete the paperwork to reinvest it with this method. The "reinvest without exchanging funds" mechanism is documented as available but not selected by Treasury. The Feb 2026 transaction proceeded with separate maturity redemption (2/1/2026) and new purchase wire (2/17/2026), maintaining the documented operational independence of maturity and new-purchase cash flows. ### Stage 2: Pulley same-day acceptance (1/14/2026 ~4:30-ish PM) Pulley's response email is preserved only in reply-tail fragment retained within Berman's 4:43 PM reply. The visible fragment confirms book-entry settlement preference: "[Book] entry settlement. Book entry settlement should make life easier for all of us. Thanks again!" Berman's 4:43 PM reply confirms: "Yes, should make things much easier Steve. I hope your custodian will agree!" The order-acceptance turnaround from Berman's 2:31 PM cold solicitation to Pulley's ~4:30 PM acceptance is approximately **2 hours and 12 minutes**. The substantive merits analysis (alternatives shopping, yield comparison, credit re-evaluation, sovereign-credit-watch consideration) is not preserved in the documentary record. The acceptance was within a sub-half-day window; whether Pulley placed phone calls or consulted other Treasury staff during the 2:31 PM - 4:43 PM window is undocumented. ### Stage 3: Compliance preparation (1/22/2026 - 2/3/2026) - 1/22/2026: Treasury overnight-forwards the maturing certificate (8th Institutional CUSIP 46514TZG6) to Computershare per Berman's instructions. Gladden coordinates with BNY (Jeffrey D. Marcus, Paul Mastros, Arnold Dorville) on DTC Vault cert release; tracking number documented in the BNY Corporate Actions reply chain. - 1/22/2026 11:20 AM: Berman follow-up to Pulley pushing for finalization ("Now that the cert has been forwarded, I wanted to follow up on the Feb 1 reinvestment"). - 2/2/2026 3:36 PM: Luis Jimenez emails the formal order confirmation to Gladden + Pulley with attachments: "2025 Accredited Investor Letter 8-1-2025.pdf" (the blank QIB template for the August 2025 PPM cycle) and "Arkansas State Treasurer Investment Form 2-2026 (Book).pdf" (the new-bond order form). Bond details documented: > [!evidence] Redacted communications.pdf, Jimenez to Gladden + Pulley, 2/2/2026 3:36:33 PM > 13th Series Institutional Jubilee Fixed Rate Bond 5-Year > Cusip: 46515DSQ6 > Issue Date: 2/15/2026 Maturity Date: 2/1/2031 > Interest Rate: 4.93% > Interest Payment Dates: May 1 & November 1 > First Coupon Date: May 1, 2026 > Interest Calc Method: Actual/365 > > The wire should be sent on February 17th, 2026. - 2/3/2026 2:30 PM: Gladden returns the signed Accredited Investor letter to Jimenez: > [!evidence] Redacted communications.pdf, Gladden to Jimenez + Pulley, 2/3/2026 2:30:04 PM > Please see accredited investor letter, attached. We will wire funds on Feb 17. The signed PDF is named "State of Arkansas Accredited Investor.pdf" but is not separately produced in R3. The signatory identity is not visible in the extract; the Huffman-precedent on the May 2025 transaction suggests Chief-Deputy-Treasurer-level signature was obtained. ### Stage 4: Wire execution (2/17/2026) - 2/12/2026 12:51 PM: Bradley Young confirms wire timing with Gladden ("Just confirming your below email that you are wiring the funds on Tuesday, the 17th"). - 2/17/2026 9:34:42 AM CST: Kathie Insalaco (klinsalaco) inputs the $10M wire in the Bank of America Outgoing Payments system. Template Name "Israel Bond," Template Code "Israel Bond," Beneficiary Information "Arkansas State Treasury, Israel Jubilee Bond - 5 Year." - 2/17/2026 9:36:51 AM CST: Janice Cohens (jcohens) approves the wire under dual control. Transaction Number T0Q1XIIT0KEGASJB. - 2/17/2026 9:46:00 AM: Gladden emails Bradley Young (cc Jimenez, Pulley, Berman) with wire confirmation attachment ("Wire Confirm 2-17-26.pdf"). The wire dual-control assignment is **Insalaco-as-inputter / Cohens-as-approver**. Pulley as Senior Investment Officer is NOT in the wire dual-control chain. The Treasury cash-management function (Insalaco + Cohens) executes the wire on Pulley's prior authorization; the investment-officer-vs-cash-management functional separation is documented in the dual-control chain. ### Stage 5-6: DCI Operations Approval and custodial recordkeeping The R3 production does NOT include the DCI Operations Approval (Payment Validation) document for the Feb 17 2026 wire, in contrast to the R1 production's 5/5/2025 Payment Validation document (Order ORD-2087155, Steven Hill approver) for the May 1 2025 wire. The R3 production was made 2 days after the wire (2/19/2026); the DCI Operations Approval document is presumably generated by DCI's Order Management System within 1-7 business days post-wire. The Feb 17 2026 Operations Approval document is a future FOIA target. The bond is documented as held in book-entry form per Pulley's 1/14/2026 confirmation to Berman and Jimenez's 2/2/2026 order confirmation referencing "Book" in the Arkansas State Treasurer Investment Form 2-2026 (Book).pdf attachment filename. The position will appear on subsequent Computershare Bondholder Statements at the IsraelBondsDirect Book Entry recordkeeping platform. ## Variant pattern documentation: Feb 2026 vs May 2025 The Feb 2026 transaction documents three operational-pathway variants from the May 2025 transaction: (1) **Stage 1 sales-pitch framing**: May 2025 was Huffman-target-pre-mediated ("you were planning to bring the portfolio up to $55M, with the purchase of 3 and 5 year paper. That would be a total purchase of $20M"); Feb 2026 was maturity-event-anchored with upsell-pitch (initial $5M reinvestment + "add funds" upsell). The Feb 2026 pattern does not require a pre-Berman-pitch Chief-Deputy-Treasurer conversation; the Berman-Pulley channel alone can produce a new-money override. (2) **Stage 2 order-acceptance turnaround**: May 2025 ~4 hours (12:06 PM pitch → 2:20 PM order); Feb 2026 ~2 hours 12 minutes (2:31 PM pitch → ~4:43 PM acceptance). The Feb 2026 acceptance is documented as faster, consistent with reduced internal friction over the second transaction in the same DCI-Treasury working relationship. (3) **Stage 5 DCI Operations Approval handler**: May 2025 was Berman-as-managing-director with Steven Hill approver; Feb 2026 is Luis Jimenez-as-operational-principal (with Berman cc'd but in supporting role). Berman's 1/14/2026 4:43 PM reply explicitly delegated to Jimenez: "If you have any questions on the redemption process or the book entry process for purchases, please reach out to me, or better, Luis Jimenez copied above, as he's the real operations expert in our office as you know!!" Jimenez sent the 2/2/2026 order confirmation; Bradley Young sent the 2/12/2026 wire-timing confirmation. The Berman-Pulley relationship at the senior level continues, but operational-detail execution has migrated to Jimenez at DCI's National Sales operations team. The operational pathway is structurally durable across the two Thurston purchases with these three documented variants. The pathway remains DCI-pitch-driven (Treasury does not initiate purchases through its own cadence), Pulley-as-order-placer (the Senior Investment Officer role is the order-placer authority), Chief-Deputy-Treasurer-as-QIB-signatory (Huffman in May 2025; presumed-Huffman-or-other in Feb 2026, not visible in extract), Gladden-as-wire-coordinator (the Investment Manager role coordinates the wire and DCI compliance), and Treasury-cash-management-dual-control-as-wire-executor (Insalaco + Cohens in Feb 2026; not visible separately in the May 2025 documentation but likely the same dual-control structure). [[treasury-foia-r3-2-19-26]] source page [[janice-cohens]] [[kathie-insalaco]] Treasury cash-management staff documented at the Feb 2026 wire dual-control level