New Arkansas Treasurer Dennis Milligan ran afoul of a state anti-nepotism law in his initial round of hiring, his office confirmed to me today. 

Spokesman Grant Wallace provides the details:

Yes, the first cousin of the treasurer, Sam Swayze, was hired to work in the office. He was the former Investment manager assistant and worked in the investment section under Ed Garner who reports to Autumn Sanson. He was paid $63,000/annually. He has been relieved of his duties and was allowed to resign in order to not inhibit his ability to gain future employment with the state if he so desired. His last day was last Friday, February 13.

During our due diligence review of new employee paperwork and SFIs [statements of financial interest], we discovered the relationship and that first cousin was a named relationship in the state nepotism policy. The nepotism policy was extended to Constitutional officers in 2010 via §25-16-1001.

Swayze went to work Jan. 14, so he was paid for about a month of work. Wallace said he didn’t know if the discovery about his ineligibility would trigger any requirement for repayment. He said he would check.

Also, there is a penalty provision in the statute.

If anyone approves a position and authorizes compensation to an employee in violation of this law, the person will be charged with a Class A misdemeanor. A public official who knowingly violates this law shall be subject to a civil penalty of one thousand dollars ($1,000). 

Wallace said the office absolutely had made an honest mistake and had not knowingly violated the statute. I’ve asked if the office believes the “knowing” defense applies not only to the public official, but to the misdemeanor required for anyone who approves a position and authorizes compensation in violation of the law. He promised to seek a response.

UPDATE: The treasurer’s office has referred my further questions to the attorney general’s office. I’ve asked that office additionally whether there should be a referral to a prosecutor of a review of the misdemeanor provision.

“We’re reviewing it,” spokesman Judd Deere said.