United States President Joe Biden speaks about government plans to boost American manufacturing during a brief appearance in the South Court auditorium of the White House in Washington on January 25, 2021.
Kevin Lamarque | Reuters
Wall Street and financial firms across the country hire a legion of lobbyists as the Democrats who now control the White House, Senate and House prepare to contain their industry with tighter regulations and increased scrutiny.
These companies include private equity juggernaut Blackstone, credit card and banking company Discover Financial Services, consumer credit reporting giant Equifax, and tech-powered Members Exchange. Investors in the latter company include BlackRock, Bank of America, Goldman Sachs, JP Morgan, and Morgan Stanley.
Each of the companies hired lobbyists with ties to both parties, demonstrating their desire to include key players in a closely-knit congress. Democrats hold only small majorities in both houses.
President Joe Biden has nominated several Wall Street critics for key administrative roles, including Rohit Chopra, a longtime ally of progressive Senator Elizabeth Warren, D-Mass., As director of the Consumer Financial Protection Bureau.
Meanwhile, Senator Sherrod Brown, D-Ohio, who is the expected chairman of the Senate Banking, Housing and Urban Affairs Committee, plans for the committee to "aggressively monitor the largest banks and other financial firms," CNBC said Tuesday.
Blackstone, led by former Trump supporter Steve Schwarzman, recently hired Ryan McConaghy, an associate at Forbes Tate lobbying shop. McConaghy, who once served as an advisor to Senate Majority Leader Chuck Schumer, D-N.Y., Will work for Blackstone's administrative department on "Financial Services and Taxation Issues," a report on lobbying disclosure said.
The company also brought in Matt Trant of the National Group to help with "tax laws, banking laws, labor laws," according to the lobbying registration form.
The company has spent millions on influence campaigns over the years. Last year, Blackstone spent over $ 5 million on lobbying-related expenses, according to the bipartisan Center for Responsive Politics.
A Forbes Tate spokesperson would only acknowledge McConaughy's advocacy for Blackstone and refuse to comment. Trant and a Blackstone spokesman did not respond to a request for comment.
Owl Rock Capital
Owl Rock Capital, a New York-based asset management firm co-founded by three Wall Street veterans, recently hired Arnold & Porter Kaye Scholer, a white-shoe law firm, to stand up for it. Owl Rock reached out to the company last year but terminated the agreement in June, according to a report on lobbying disclosure.
The Owl Rock campaign is made up of people who have previously worked with Sens. Susan Collins, R-Maine and John Barrasso, R-Wyo. A fourth quarter report said Owl Rock paid the law firm $ 150,000 to stand up for the House and Senate on "issues related to corporate development company regulation." Lobbying for Owl Rock began in late October.
Before Biden became president, Owl Rock hired another law firm, Sidley Austin, to lobby. One of his lobbyists working on the Owl Rock account is former Republican MP Peter Roskam of Illinois.
The Owl Rock website states, "Owl Rock Capital Group and Dyal Capital Partners announced that they have entered into a definitive business combination agreement with Altimar Acquisition Corporation to create Blue Owl Capital Inc." December reports show the new company went public through a SPAC.
One person familiar with the lobbying efforts said the previous attitudes had less to do with Biden becoming president and more to do with the work the new company will do in the stock market. This person declined to be named in order to speak freely.
Owl Rock is a direct lending platform focused on medium-sized businesses.
A member of the Arnold & Porter Kaye Scholer team did not respond to a request for comment. Roskam did not respond to a request for comment. An Owl Rock press representative did not respond to a request for comment.
Discover and exchange members
Headquartered in Illinois, Discover has an in-house lobbying team, but recently hired a non-partisan lobbying firm, Federal Hall Policy Advisors.
Federal Hall specializes in working with financial services companies. On behalf of Discover, the focus will be on "Dodd Frank Law Issues and Lending Issues," according to a disclosure report. The Dodd Frank Financial Regulation Bill was signed by former President Barack Obama in 2010. Parts of the law were repealed by former President Donald Trump.
Cliff Roberti, co-founder of the company, told CNBC that the concern of the broader financial services sector was linked to potential committee hearings, along with regulation by certain agencies, including the CFPB.
"It is unlikely that Congress will pass major financial reform laws because of the razor-thin margin of the Democrats. The bigger threat to Congress is the likely series of hearings and investigations that the banking and financial services committees will open," Roberti told CNBC Tuesday. "Ultimately, the sector needs to consider how more aggressive regulators – especially the CFPB – will try to tighten rules and strengthen enforcement."
Roberti's firm also represents Capital Market Strategies, which works on behalf of the New Jersey-based Members Exchange. The technology-driven exchange was first launched by Wall Street titans like Morgan Stanley, Fidelity Investments and Citadel. It competes directly with the New York Stock Exchange and the Nasdaq as it has fewer fees than the other institutions.
Roberti declined to comment on certain efforts he makes for his clients.
Discover and Equifax media representatives did not respond to requests for comment. A spokeswoman for the member exchange declined to comment.