Opinion

Felix Salmon

Adventures in revolving doors

By Felix Salmon
March 31, 2010

Gary Weiss reads the SEC inspector general’s report into its behavior with respect to Allied Capital and David Einhorn, and finds this startling nugget:

The official who supervised the Allied probe got a special “thank you” from Allied. This person (his name is blanked out in the report) left the SEC a year later to work for the company, apparently as a registered lobbyist. The exact position he got is unclear in the report, but we do know that the SEC ethics office had no problem with that. Apparently the SEC’s conflict-of-interest rules can be summed up as a cheery “okie dokie!”

Meanwhile, Ira Stoll finds a bunch of gamekeepers-turned-poachers on the attendee list at an FDIC meeting. Among them are Allen Puwalski, who went from the FDIC to working for John Paulson; John Douglas, who went from the FDIC to a partner position at Davis Polk, where he’s “counseling Citigroup with respect to FDIC matters”; John C. Murphy, who went from the FDIC to a partner position at Cleary Gottlieb; and Kevin Stein, who went from the FDIC to FBR Capital Markets.

It’s all well and good these people moving to the private sector, but do they really need to rub it in by hanging out at high-level meetings held at their former employer?

Stoll also notes the presence at the meeting of Randy Quarles, who moved from being the point-man on many regulatory issues at Treasury to an MD position at Carlyle Group.

And while we’re on the subject, it’s worth noting Matthew Leising’s story about Peter Roberson, who’s moving from his job liaising with banks and exchanges for Barney Frank. He’s now, depressingly, going to be a registered lobbyist for Intercontinental Exchange.

If even Barney Frank’s staffers can’t resist the appeal of the revolving door, there’s really no hope that Frank or anybody else will be able to put an end to the practice. Especially when it regularly benefits cabinet ministers.

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