With Daniel Lippman
FIRST IN PI — ROBINHOOD BUILDS A PRESENCE ON K STREET: Robinhood, the no-commission trading app that’s seen its popularity skyrocket during the pandemic, is building a presence in Washington in a big way. The company has hired four lobbying firms, according to disclosure filings: Blue Ridge Law & Policy, the Daly Consulting Group, Thorn Run Partners and the Williams Group. Robinhood also brought on Lucas Moskowitz, a former chief of staff to Securities and Exchange Commission Chairman Jay Clayton, last month as deputy general counsel for regulatory, litigation and government affairs.
— Moskowitz, who was a partner at WilmerHale before heading to Robinhood, and Kirtan Mehta, Robinhood’s public policy counsel, plan to register to lobby for the company as well, according to a Robinhood spokesperson. Daniel Gallagher, a former SEC commissioner, also left WilmerHale earlier this year to join Robinhood as chief legal officer.
— The hires come as Robinhood has faced increasing scrutiny in Washington. Clayton told the House Financial Services Committee in June that the SEC and the Financial Industry Regulatory Authority would look into Robinhood following the suicide of Alex Kearns, a 20-year-old trader whose Robinhood account showed a negative balance of more than $700,000 after he made a sophisticated options trade, according to The Wall Street Journal. Vlad Tenev and Baiju Bhatt, Robinhood’s founders, wrote in a blog post after Kearns’ death that the company would consider “additional criteria and education for customer seeking” to make similar options trades.
— Reps. Brad Sherman (D-Calif.), Bill Foster (D-Ill.), Sean Casten (D-Ill.) and Lauren Underwood (D-Ill.) and Sens. Dick Durbin (D-Ill.) and Tammy Duckworth (D-Ill.) wrote to the company last month demanding answers. “For Alex Kearns, and all of its users, Robinhood must do better,” they wrote.
— Asked whether Robinhood’s decision to build a presence in Washington was in response the scrutiny, a Robinhood spokesperson said the company’s “plan has always been to enhance our engagement with policymakers and as such it makes sense to expand our presence in D.C.” “We strive to maintain constructive relationships with policymakers,” the spokesperson said in a statement. “We’ll continue to enhance our proactive engagement with members of Congress, their staff, and our regulators, as we work to make the financial system more accessible and approachable for everyone.”
Good afternoon, and welcome to PI. This newsletter wishes it had the foresight to relocate to Maine for August, as some of its readers seem to have done, but there’s always next summer. In the meantime, send me your tips: [email protected]. You can also follow me on Twitter: @theodoricmeyer.
MORE NEW BUSINESS: The Blackstone Group has added PricewaterhouseCoopers to its lineup of Washington lobbying firms. Drew Lyon, who served as the Treasury Department’s deputy assistant secretary for tax analysis in President George W. Bush’s administration, and Karl Russo will lobby for the investment giant on the taxation of real estate investment trusts, according to a disclosure filing. Blackstone also retains half a dozen other lobbying firms.
— Lego appears to have hired its first Washington lobbyists. Christopher Murray and Benjamin Grove of Thompson Coburn will lobby on issues related to the Elementary and Secondary Education Act and the Higher Education Act, according to a disclosure filing. And the American Exploration and Production Council has hired Mehlman Castagnetti Rosen & Thomas to lobby on its behalf. The trade group, which represents oil-and-gas companies with interests in shale, also retains Akin Gump Strauss Hauer & Feld, although the firm hasn’t lobbied actively for the trade group since last year.
FARA FRIDAY: The Boston Consulting Group and McKinsey retroactively registered under the Foreign Agents Registration Act this week for work they did more than four years ago on behalf of Saudi Arabia’s government. Boston Consulting Group “organized and provided support for meetings between” a Saudi delegation to the U.S. and American think tanks, business groups and companies, including defense contractors, automakers, education companies and investment and private equity firms, the consulting firm disclosed in its filing.
— McKinsey’s work involved “preparing Saudi officials for engagement with certain US private and public sector counterparts in Saudi Arabia; and assisting in arranging and supporting meetings in the United States in February 2016 and June 2016 between Saudi officials and think tanks and/or corporations in various sectors including finance and technology,” according its disclosure filing. Neither firm contacted U.S. government officials on the Saudi government’s behalf. McKinsey was paid nearly $4.8 million for the work and Boston Consulting Group was paid nearly $2.8 million, according to the filings.
— The filings come three months after another well-known consulting firm, Booz Allen Hamilton, retroactively registered for its own work for Saudi Arabia. The disclosure appear to cover only a fraction of the firms’ consulting work for the kingdom, which wouldn’t be subject to FARA registration as long as its done abroad and doesn’t involve outreach in the U.S. The New York Times reported in 2018 that “the three firms have earned hundreds of millions of dollars altogether on projects in Saudi Arabia.”
— “Like many other professional services firms, we have taken note of the additional guidance around FARA and are committed to meeting our obligations,” a McKinsey spokesperson said in a statement. “We proactively prepared and submitted this filing to ensure we did just that.” A Boston Consulting Group spokesperson said that after reviewing its work, “BCG arrived at the conclusion that the work we performed previously could require registration under FARA, and consequently proceeded to register.”
SCHUMER SIGNS ONTO RESTAURANT BILL: Senate Minority Leader Chuck Schumer is the latest member of Congress to co-sponsor legislation introduced by Sens. Roger Wicker (R-Miss.), Kyrsten Sinema (D-Ariz.), Lindsey Graham (R-S.C.) and Chris Coons (D-Del.) in June that would set up a $120 billion fund to rescue the restaurant industry. “As one of the hardest hit industries during this pandemic, we must do everything we can to ensure our restaurants and our restaurant workers are protected, otherwise we will shortchange our entire economy,” Schumer said in a statement.
— The National Restaurant Association and the Independent Restaurant Coalition cheered Schumer’s support, but it’s far from clear the legislation is going anywhere. While 28 senators have backed the bill, it wasn’t included in Senate Republicans’ package last month, and it remains unclear whether Congress will pass another coronavirus relief package before the election at all.
HOW A HOLLYWOOD PRODUCER FIGURES INTO THE NATIONAL RIFLE ASSOCIATION LAWSUIT: “An Emmy-award winning Hollywood producer with longtime ties to the National Rifle Association has emerged as a major figure in the New York attorney general’s case alleging corruption and spending abuses at the nonprofit gun-rights group,” The Wall Street Journal’s Mark Maremont reports. “A lawsuit filed last week by the office of Attorney General Letitia James against the NRA alleges that the producer, David McKenzie, was the ‘principal stakeholder’ in four large NRA vendors that together were paid $100 million by the NRA in recent years.”
— “Mr. McKenzie also lent NRA CEO Wayne LaPierre his 108-foot yacht on several occasions, paid for Mr. LaPierre’s stays at a Bahamas resort, and Mr. McKenzie and his family received costly gifts from Mr. LaPierre at the NRA’s expense, the lawsuit says. Mr. LaPierre traveled by private jet to Los Angeles to meet with Mr. McKenzie at least 20 times between 2013 and 2017, the complaint says.”
— “Mr. McKenzie isn’t named in Ms. James’s complaint but is referred to as the ‘MMP Principal’ — a reference to Membership Marketing Partners LLC, one of the NRA vendors with which he was allegedly involved. Mr. McKenzie’s identity is clear from other public documents and prior Wall Street Journal interviews with him. … Mr. McKenzie said he hadn’t read the complaint and couldn’t discuss any litigation. In prior interviews with the Journal, he defended his dealings with the NRA as appropriate.”
NEW COALITION SEEKS TO CHANGE THE CHAMBER: A new effort called Change The Chamber is urging members of the U.S. Chamber of Commerce to push the trade group “to change its stance on climate change or else risk ‘your future market,’” POLITICO’s Zack Colman reports. The student-led coalition is sending letters today to the chief executives of “AT&T, Pfizer, Google, 3M, Verizon, Disney, Johnson & Johnson, UPS, Ford and others. The letters contain three asks: work to change the Chamber or quit it, actively lobby for science-based climate legislation and stop funding climate-denying politicians. The groups want the companies to commit to those goals or quit the Chamber by Oct. 10.”
— “‘The Chamber and our members continue to focus on advancing real solutions to our climate challenge,” Chamber spokesperson Matt Letourneau said in an email in response to the campaign. The campaign comes as the Chamber has sought to update its climate stance, in part from members’ pressure that ultimately pushed it to form a Members Task Force on Climate Action.” Apple and several utilities quit the Chamber more than a decade ago over disagreements about climate policy.
— The semiconductor manufacturer SkyWater Technology has hired John Cooney as director of U.S. government relations. He was previously the Commerce Department’s International Trade Administration as deputy assistant secretary for global operations. He expects to register as a lobbyist.
Jensen Victory Fund (Jesse Jensen for Congress, Washington State Republican Party)
Jones Houlahan Victory Fund (Mondaire for Congress, Chrissy Houlahan for Congress)
Texas Reloaded (Rep. Dan Crenshaw, Collins for Texas, Beth Van Duyne for Congress, Tony Gonazles for Congress, Nehls for Congress, Hunt for Congress, Republican Party of Texas)
Americans for All (Super PAC)
Fairview for Biden (PAC)
Foundation SUPERPAC (Super PAC)
Paws and Claws Political Action Committee (PAC PAC) (Hybrid PAC)
Ruralvote.org (Super PAC)
Capitol Counsel, LLC: Firstfloor
Elevate Government Affairs, LLC: RIM Services, LLC
GovBiz Advantage, Inc.: Fortress North America
LeBlanc Government Relations, LLC: Pacific Northwest Waterways Association
Whitmer & Worrall, LLC: University of Central Florida
BGR Government Affairs: Alnylam Pharmaceuticals, Inc.
Peter Pitsch: 5G Everywhere in America, LLC on behalf of C-Band Alliance