Democrat Dirty Laundry: Hedge Funds ‘Happily Backing’ Democrats Wall $treet Bill

Hedge Funds ‘Happily Backing’ Democrats’ Wall $treet Bill
Will Receive ‘Huge Competitive Advantage’ as Dems Profit from Hedge Fund Cash

SPIN CYCLE: Speaker Pelosi Vowed that Democrats Would Lead the “Most Honest, Most Open, and Most Ethical Congress in History”

“Our goal is to restore accountability, honesty and openness at all levels of government. To do so, we will create and enforce rules that demand the highest ethics from every public servant, sever unethical ties between lawmakers and lobbyists, and establish clear standards that prevent the trading of official business for gifts.” (Nancy Pelosi’s “A New Direction for America,” Page 21)

RINSE CYCLE: Hedge Funds ‘Happily Backing’ the Democrats’ Wall $treet Bill That Will Give Them a ‘Huge Competitive Advantage’:

“There’s one corner of Wall Street that is happily backing Congress’s regulatory overhaul of the U.S. financial system: the $1.7 trillion hedge fund industry.”

“The tightening of regulations on banks could usher in a new era of profitability for hedge funds, pushing money and trading talent their way.

“The bottom line: If hedge funds get light regulatory treatment from Congress they will end up with a huge competitive advantage over commercial banks[.]” (Robert Schmidt, “The Charmed Life of Hedge Funds,” Bloomberg Businessweek, 5/13/10)

FLASHBACK: Top 10 Hedge Fund Managers, Including George Soros, Earned $18.75 Billion in Personal Income and Gave 98% to Dems:

“The world’s top-earning hedge fund managers have bankrolled almost exclusively Democratic campaigns.

“The top 10 highest-paid hedge fund managers in 2009 have dished out campaign contributions almost only to Democrats.

“Over their lifetimes, those managers have given almost $33 million in campaign contributions to Democrats, according to research by the National Republican Congressional Committee (NRCC) and that is based on data maintained by the nonpartisan CQMoneyline.”

“The contributions went 98 percent to Democrats and two percent to Republicans.” (Silla Brush, “Hedge Funds Donate Big to Democrats,” The Hill, 5/03/2010)

FLASHBACK: Former Dem Staffers Succeed in Getting Special Interest Deal to Protect Hedge Funds, Leaving ‘No Question’ Hedge Funds Have ‘Gotten a Free Ride’:

“Wall Street  has taken its lumps in Washington recently and Goldman Sachs has become everyone’s whipping boy, but hedge funds and private equity firms have escaped relatively unscathed.

“There’s no question they’ve gotten a free ride,” said Robert Weissman, president of the consumer group Public Citizen.

“And one reason for that, according to Weissman, is a particularly well-connected group of lobbyists. More than half the 83 lobbyists registered last year to work for the industries’ two trade groups, the Private Equity Council and the Managed Funds Association, have served in government — from Capitol Hill to the Treasury Department.”

“Industry lobbyists said that by focusing their fire on Goldman Sachs and other brand-name banks, Democrats have been able to give an easier ride to firms with names most people wouldn’t recognize. But influential lawmakers surely would.”

“One of the wealthiest hedge fund managers, John Paulson, held a $1,000-per-person fundraiser for Dodd last year and gave the maximum contribution to his now-defunct reelection campaign. And when Schumer ran the Democratic Senatorial Campaign Committee, he collected almost $150,000 from 10 of the richest hedge fund managers.

“Hedge fund managers, Weissman said, are in the business of using inside information to make money, a model they’ve successfully translated to Washington, where they’ve built the relationships they are now trading on.”

“The MFA’s chief lobbyist, Roger Hollingsworth, worked as deputy staff director of the Senate Banking Committee and was one of Dodd’s senior advisers during the previous Congress.”

“Alex Sternhell has also been deputy staff director on the Senate banking panel. He thanked Dodd for his friendship when he left the committee for The Cypress Group in 2007.”

“Jimmy Ryan worked as a top aide to Senate Majority Leader Harry Reid (D-Nev.) for a decade before leaving in 2003 to help head Citigroup’s Washington office. Ryan now works at Elmendorf Strategies representing the MFA. The trade group paid the lobbying firm $200,000 last year and $60,000 this year.

“Carmencita Whonder was a senior Banking Committee aide to Schumer and lobbies for the MFA and the Private Equity Council in her role as a policy director for Brownstein Hyatt Farber and Schreck. The MFA paid the firm $200,000 last year and $60,000 this year.

“James Flood, also of Brownstein, worked as Schumer’s counsel on the Senate Judiciary Committee and lobbies for the Private Equity Council, which paid his firm $440,000 last year and $90,000 this year.” (Chris Frates, “Hedge Funds Get ‘Free Ride,’” Politico, 5/03/2010)

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