Statement on Confirmation Hearing of Trump’s Nominee for Wall Street’s Top Cop
WASHINGTON, D.C. – Today Allied Progress released the following statement concerning the Senate Banking Committee’s confirmation hearing for President Donald Trump’s nominee to chair the U.S. Securities and Exchange Commission, Wall Street mega-lawyer Jay Clayton:
“Today we learned a great deal about Jay Clayton’s career as Wall Street’s go-to legal yes man. He has assisted numerous multinational companies, including Goldman Sachs, that have fought corporate investigations and stopped enforcement actions involving regulators like the SEC–the very agency he hopes to lead. Through it all, he has shown little regard for the negative impact his clients have on individual investors or the American economy,” said Karl Frisch, executive director of Allied Progress.
He continued, “Quite frankly, Mr. Clayton has some downright nutty views about the government’s role in reigning in corporate excess. He literally wants to weaken the law prohibiting corporations from bribing foreign governments. To hear him tell it, American businesses just cannot compete if they are not traveling the globe bribing dictators and despots. It is difficult to see how he could possibly be trusted to enforce these and other important laws if he considers them mere obstacles around which businesses must navigate.”
“Wall Street and its unchecked recklessness caused the 2008 financial crisis that robbed millions of American families of their financial security, retirement savings, and homes. A man like Jay Clayton who has spent his entire career putting the interests of Wall Street ahead of hard-working Americans cannot be trusted to run an agency like the SEC,” he concluded.
In December, Allied Progress launched Trump Transparency Project, an initiative aimed at holding the incoming administration accountable for its economic appointments and policies that betray America’s middle class. You can read the project’s 15-page research dossier on Clayton here.
- Clayton is a partner at a law firm “more closely associated with Wall Street than perhaps any other.” Jay Clayton is President Donald Trump’s nominee for Chairman of the U.S. Securities and Exchange Commission. A partner at Sullivan & Cromwell, a law firm “more closely associated with Wall Street than perhaps any other,” Clayton has built his career representing major multinational companies like Bear Stearns, Lehman Brothers, and Goldman Sachs to name a few.
- Clayton’s conflicts of interest are vast — he will have to recuse himself from a significant portion of the job he’s seeking. If confirmed, Clayton will be required to recuse himself “for one year from voting on any particular matter if a firm or individual is being represented by” his law firm, and “for a year from working on matters that involve clients he represented in the past year.” He also will be “recused indefinitely if a deal he previously worked on comes up during SEC litigation.” Based on an analysis of “recent” and “selected” Sullivan & Cromwell clients, it is estimated that Clayton will need to recuse himself from cases involving nearly one-third of the institutions on the Financial Stability Board’s list of “global systemically important banks.” But, that number could be much larger as there is no way of determining the identities of all of Clayton’s clients and the scope of his representation of those clients, without full disclosure by him.
- Clayton has been involved in high-profile, controversial deals that wiped out shareholder wealth. In addition to being involved in controversial deals that wiped out shareholder wealth, and others that set off global market turmoil that roiled the financial world.
- Clayton wants to make it easier for corporations to bribe foreign governments. During the 2008 financial crisis, Clayton has “advocated for less zealous enforcement of the Foreign Corrupt Practices Act” (FCPA), which “prohibits the payment of bribes to foreign officials to assist in obtaining or retaining business.” He even oversaw a report that attacked the Obama administration for enforcing the law, claiming its application was “‘causing lasting harm to the competitiveness of U.S. regulated companies.’” To hear him tell it, American businesses just cannot compete if they are not bribing foreign governments. It is difficult to see how he could possibly be trusted to enforce these and other important laws if he considers them mere obstacles around which businesses must navigate.
- Clayton represents an extension of the Trump administration’s troubling pattern of nominating individuals with Russian ties. His law firm, Sullivan & Cromwell, has advised numerous entities including companies doing business with Russian oligarchs, and the Russian government, on financial and oil and gas projects. It also represented Deutsche Bank on a consent order related to the bank’s role in a $10 billion “Russian money laundering scheme.” If that scandal-plagued financial institution sounds familiar, it should: The Trump Organization has enormous debt “with Deutsche Bank, which loaned it more than $364 million in recent years and more than $3 billion since the 1990s.”
To speak with Karl Frisch about the Clayton nomination, please contact Rachel Palermo at 202-464-6951 or email@example.com.
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Allied Progress is a nationwide, progressive advocacy organization that uses hard-hitting research and creative campaigns to hold Wall Street and powerful special interests accountable. Since launching in 2015, the organization has led high-profile campaigns on several issues including reforming the payday lending industry and exposing the those working to cripple the Consumer Financial Protection Bureau (CFPB).