- Associated Press - Friday, August 14, 2015

LITTLE ROCK, Ark. (AP) - Arkansas’ auditor is asking a judge to issue a temporary order giving her control of up to $151 million in unclaimed federal bonds owned by state residents.

Lawyers for Auditor Andrea Lea contend that if Pulaski County Circuit Judge Alice Gray doesn’t issue the order, then the money will go into federal coffers. They say the U.S. Treasury Department possibly could claim them as soon as Tuesday, the Arkansas Democrat-Gazette (http://bit.ly/1IQF3LX ) reported.

“If the court does nothing, (the) Treasury will have unilateral authority to make sure this money will not come back to Arkansas,” Lea’s attorney, David Thompson, told the judge. “The question becomes, does this money come back to Arkansas or stay in Washington? That’s really the choice before the court.”

Arkansas can claim title to bonds that are unclaimed for at least seven years past maturity, under a state law that went into effect July 23. The state still will have to go through federal courts to assert ownership following a favorable circuit court ruling, which Thompson said could take “years and years.”

But the Treasury Department has proposed a new rule that would allow it to keep the bonds, Thompson said.

Several of the judge’s questions to Lea’s attorneys couldn’t be definitively answered, such as the total of bond owners in Arkansas or why Lea waited until Aug. 5 to file her lawsuit when the Treasury rule change was proposed July 1.

Gray said she was uneasy giving the state title to bonds of people who don’t know their property is being taken, even if it’s only temporary. She said she was uncomfortable acting quickly with not enough evidence to go on and noted there wasn’t anyone to contest Lea’s petition.

“This is $151 million,” she said. “You’re asking the court to decide with no evidence. All we have is attorneys’ arguments.”

She said her decision on the court order will come as soon as possible.

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Information from: Arkansas Democrat-Gazette, http://www.arkansasonline.com

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