House Oversight Committee: A Unique Spin on the Revolving Door?

By BRYAN RAHIJA

Think Progress reports that a staffer hired by Rep. Darrell Issa (R-CA) is now working on efforts to loosen financial regulations that would affect his former employer.

The staffer, Peter Haller, is a former VP of Goldman Sachs. These days, his name has been showing up under letterhead for the House Committee on Oversight and Government Reform (HOGR), which Rep. Issa chairs. From TP:

In July, Issa sent a letter to top government regulators demanding that they back off and provide more justification for new margin requirements for financial firms dealing in derivatives. A standard practice on Capitol Hill is to end a letter to a government agency with contact information for the congressional staffer responsible for working on the issue for the committee. In most cases, the contact staffer is the one who actually writes such letters. With this in mind, it is important to note that the Issa letter ended with contact information for Peter Haller, a staffer hired this year to work for Issa on the Oversight Committee.

So what was in the letter?

Issa’s demand to regulators is exactly what banks have been wishing for. Indeed, Goldman Sachs has spent millions this year trying to slow down the implementation of the new rules. In the letter, Issa explicitly mentions that the new derivative regulations might hurt brokers “such as Goldman Sachs.”

All this raises questions about whether Issa's letter was written with the public's best interest in mind. It also, by the way, wouldn’t be the first time questions were raised about the Chairman’s ties to the vampire squid.

And as it turns out, this isn’t the only HOGR letter bearing Haller’s name.

More letters with Haller's name

Haller's name also appears on at least three other HOGR letters—one from January, one from March, and one from April.

The March letter mentions Goldman Sachs on page 5 in connection with Goldman's decision to exclude U.S. investors from investing in Facebook. In a nutshell, Issa et al. wanted the Securities and Exchange Commission (SEC) to make it easier for companies to raise money privately before having to go public and register with the SEC. They've raised concerns that the SEC's "outdated" policies forced Goldman to exclude U.S. investors from investing in Facebook.

In response, the SEC announced they were considering relaxing the rules. But Mary Schapiro also wrote in her response letter that the SEC never told Goldman Sachs it couldn't make the offering to U.S. investors. She also pointed out that the rules still play an important role in deterring fraudsters from scamming investors:

At no point in time did the staff advise or instruct Facebook or Goldman Sachs that the offering could not be conducted in the United States....the general solicitation ban has been supported by others on the grounds that it helps prevent securities fraud by, for example, making it more difficult for fraudsters to attract investors or unscrupulous issuers to condition the market.

A unique spin on the revolving door

Haller is a prime example of someone who has made use of the revolving door between the government and the private sector. To wit:

– After completing his law degree in 2000, Haller was employed by Federal Energy Regulatory Commission as an economist, and later with the Securities and Exchange Commission in the Office of Enforcement.

– In April of 2005, Haller resigned from the SEC to take a job with Goldman Sachs. He worked on compliance issues on behalf of Goldman Sachs that sometimes required him to interface with the SEC.

– In 2006, Haller left Goldman Sachs to take a job with the law/lobbying firm Brickfield Burchette Ritts & Stone.

– In January of 2011, Haller was hired to work for Issa on the Oversight Committee. Under the supervision of Haller, Issa sent a letter dated July 22, 2011 to bank regulators (including the heads of the Federal Reserve, FDIC, FCA, CFTC, FHFA, and Office of Comptroller) demanding documents to justify new Dodd-Frank mandated rules on margin requirements for banks dealing in the multi-trillion dollar OTC derivatives market, like Goldman Sachs.

Haller also appears in POGO's SEC Revolving Door Database. And here's where it gets interesting: until around three years ago, Haller went by the name Peter Simonyi. As he himself explains it, Haller, conjuring images of vampires yet again, changed his name to honor his Transylvanian heritage.

If Haller’s name change had not been discovered, would anyone have been able to piece together his history?

An Issa spokeswoman offered this comment: "Information peddled by faux reporters, like those at the left-wing Center for American Progress, is almost always sensationalized and often factually inaccurate. The truth is often far from how they try to portray it."

Bryan Rahija edits POGO's blog.

Follow @bryanrahija

Comments

[Emile Zola]

In other words, what the author is trying to tell us is that we are up the creek without a paddle. Obama, not necessarily a democrat and some democrats that look and act more and more like republicans imply that the goose is cooked and we are in it for the ride. It's stupid that the Obama administration on the hands of Goldman Sacks, they are going to do any thing and any thing against them, quite the opposite, they'll find the way to bill us for the corrupt practices of Wall Street and what is worse, I don't see the light at the end of the tunnel. The Obama will easier go after Bush and his war crimes than go after his proteges. The second coming of Christ looks more and more appealing all the time. At least we will see Obama war criminals and corrupt Wall Street get their well deserved hell.

[Bob Pitchalonis]

Why isn't something like this illegal?

[Carol]

This is so insane I really don't have the proper words and that is a fact!!!

[Helen Gori]

I would expect NO MORE from the combined efforts of Congressman Issa and those who inhabit the shadowy world of investment banking.

I was wondering why Rep Issa was not making more noise, getting more attention, and now I know. He was busy working out the details of his distortion of the use of regulatory powers. I am sure that his political campaigns and those who will be willing to sign over there consciences to be considered a 'friend' will not lack donations from those at Goldman and the other firms that he will assist.

[A. D. Jackson]

Derivatives are something that escaped SEC and are poorly understood if at all. Derivatives do need investigation at the outset. Regulation to prevent skullduggery may arise later.