Last year, as Issa began recruiting for his committee, he selected Peter Warren, a lobbyist for the student loan industry. Warren had been president and executive vice president of government affairs of the Education Finance Council (EFC), a trade association for student loan companies and nonprofits, since 2004. He left EFC for the Karl Rove front group American Action Forum for a brief stint in 2010 before joining Issa as the policy director of the House Oversight Committee.
Many lobbyists burrow into government to write laws or regulations, then leave to take even higher paid positions back in the private sector. This phenomenon — the so-called “revolving door,” or reverse revolving door in this case — has plagued government for years. While examples of such corruption are boundless on both sides of the aisle, Warren is particularly interesting given his continued relationship with his lobbying group. According to disclosures filed with the House clerk, Warren signed a severance agreement with EFC before leaving to work in government. Congressional personnel are expected to disclose when they maintain benefits packages, promises of bonuses when they return to work for an outside organization, or other financial ties. Take a look at a screenshot of Warren’s disclosure below (click to enlarge):
While severance agreements relating to continued financial ties between a senior congressional staffer and an outside organization must be disclosed, the details or a copy of the agreement may remain private. Vince Sampson, the current president of EFC, refused our request for more information about the nature of Warren’s severance contract. “We can’t and won’t discuss that,” he told ThinkProgress. Requests to the Oversight Committee by ThinkProgress have gone unanswered. According to the disclosure, Warren also received a special severance pay bonus before he left the lobbying world to enter government.
“In the reverse revolving door, business interests and their lobbyists attempt to ‘capture’ those congressional committees or executive agencies that oversee the business’ interests,” explained Public Citizen’s Craig Holman, an expert on congressional ethics. “By placing their lobbyists on these committees, the business interests gain direct access and influence unavailable to others, and can easily shape the policies and administrative decisions that affect the business,” Holman said, adding, “Peter Warren appears to be following suit.”
The EFC, Warren’s previous and possible future employer, is notable because it represents lending companies entering a new era of regulation. The Bureau of Consumer Financial Protection, the agency created by the Dodd-Frank legislation, will have broad authority to regulate the way private loans are marketed and sold to students. EFC represents some of the nation’s largest student lenders, including Citigroup, Wells Fargo, Bank of America, and Discover Student Loans.
While President Obama is unlikely to repeal recently passed consumer regulations or weaken the Bureau, the Oversight Committee has almost unlimited power to investigate the agency and slow down the implementation of new rules. Chairman Issa, with Peter Warren at the helm of his staff, has aggressively attacked the new Bureau. Issa has investigated Professor Elizabeth Warren, a consumer advocate tasked with helping set up the Buraeu, and promised more hearings into how the Bureau conducts its oversight. Speaking to the press, Issa has said that he is “very concerned” that the agency will “bully” the banking industry.
Peter Warren’s perch at the Oversight Committee could be a boon to his former lobbying association. Samantha DeZur, a spokeswoman for EFC, told ThinkProgress that many of EFC’s member companies will fall under the jurisdiction of the new Bureau, but could not give details about her organization’s specific concerns. Last week, the EFC convened a meeting with its lobbyists and member companies to discuss the Consumer Financial Protection Bureau’s “authority concerning unfair, deceptive, and abusive trade practices” as well as “areas of initial enforcement interest to the CFPB.”
ThinkProgress has documented a number of other banking interests using the reverse revolving door to undermine new regulations on banks and the finance industry. We broke the story that Ryan McKee, a derivatives lobbyist charged with “trying to kill” Dodd-Frank, was hired by a congressional committee that oversees derivatives legislation (since the story in January, the chairman of McKee’s committee has introduced legislation to delay Dodd-Frank rules over derivatives until 2013). Members of Congress, including Sens. Marco Rubio (R-FL), Ron Johnson (R-WI), Mike Lee (R-UT), Pat Toomey (R-PA), as well as Reps. Chip Cravaack (R-MN), Charlie Bass (R-NH), Chris Gibson (R-NY), Robert Dold (R-IL) and others, have hired corporate lobbyists, some of them with portfolios including the banking industry, as their chiefs of staff.