Senate panel chides PIF consultants for deferring to Saudi court

Presented by Electronic Payments Coalition: Delivered daily, Influence gives you a comprehensive rundown and analysis of all lobby hires and news on K Street.

Feb 07, 2024 View in browser   By Caitlin Oprysko Presented by With help from Daniel Lippman BETWEEN A RICH AND A HARD PIF: Senators on the panel investigating the Saudi sovereign wealth fund’s U.S. business dealings warned Wednesday of potentially sweeping ramifications for future federal investigations should a group of consultants working for the Public Investment Fund abide by a Saudi court’s determination of what the consultants may turn over in response to a congressional subpoena. — “The position that I’ve heard expressed today is essentially that you will comply with a subpoena, but only and solely so far as Saudi Arabia allows you to do so,” Permanent Subcommittee on Investigations Chair Richard Blumenthal (D-Conn.) told executives from Boston Consulting Group, McKinsey & Co., M. Klein & Company and Teneo at a hearing about the subpoenas. “You say that you’re between a rock and a hard place, but you’ve chosen sides,” he shot back at them at one point. — The executives maintained that they are pushing back against a Saudi court injunction, including, as McKinsey’s Bob Sternfels told the committee, “disputing any claim that our employees are public officials under Saudi law.” — But, investment banker Michael Klein argued, his firm is “under significant legal constraints outside of our direct control” that expose Klein or his employees to up to 20 years behind bars in Saudi Arabia or civil penalties for turning over certain documents related to their work for the wealth fund — in violation of the Saudi court order. — PIF has argued some of those documents are considered “classified” because they could pose a threat to Saudi national security and sovereignty, an assertion lawmakers were quick to push back on. “Saudi Arabia claims that these are just innocuous commercial investments, including investments in sports,” said Blumenthal. “But in its own courts, it argues that it’s classified material pertaining to the state, national security interest. It simply can’t have it both ways.” — PIF has declined repeatedly to appear voluntarily before the subcommittee, but vowed in a statement before Tuesday’s hearing to “continue working constructively and with integrity with the Subcommittee with relevant information that can legally be disclosed under the laws of Saudi Arabia.” — Both PIF and its consultants maintained that they’ve been as responsive as possible to the subcommittee’s subpoenas, but Blumenthal dismissed the submissions thus far as “laughable,” saying they contained heavy redactions or publicly available information like news clips and financial filings. — Senators defended the subcommittee’s jurisdiction for the investigation, which attorneys for PIF have argued has become much too broad. Blumenthal’s counterpart on the subcommittee, Sen. Ron Johnson (R-Wis.), conceded that investigating PIF “is not my top priority.” But “any foreign entity wishing to do business in the U.S. must comply with U.S. law and be responsive to congressional subpoenas,” he said. — Lawmakers also grilled the executives on their decisions to enter into and remain in business with the Saudis. “Do you normally retain clients who sue you?” Sen. Laphonza Butler (D-Calif.) — a former consultant herself — asked the witnesses, who agreed that their situation was highly unusual. She called it “incredibly curious” to continue working for a client who would threaten “your company, your livelihood, the security of your employees.” — Blumenthal also used the hearing — which stemmed from the subcommittee’s probe into the sudden alliance between PIF-funded LIV Golf and the PGA Tour, and whether the Kingdom is investing in sports to boost its global soft power and distract from its troubled human rights record — to call for strengthening FARA. Of the witnesses on Tuesday, only Teneo registered under FARA for its work for PIF, which Teneo’s chief executive Paul Keary emphasized numerous times. — McKinsey’s Sternfels, under questioning from Blumenthal, said that legal counsel had determined McKinsey’s work for PIF didn’t require a FARA registration. “I’m not saying that your not doing so violates the law,” Blumenthal told Sternfels. “But the law should be strengthened so that there is a legal obligation under these circumstances. It’s clear and unmistakable.” Happy Tuesday and welcome to PI. Send lobbying tips: coprysko@politico.com. And be sure to follow me on the platform formerly known as Twitter: @caitlinoprysko.   CONGRESS OVERDRIVE: Since day one, POLITICO has been laser-focused on Capitol Hill, serving up the juiciest Congress coverage. Now, we’re upping our game to ensure you’re up to speed and in the know on every tasty morsel and newsy nugget from inside the Capitol Dome, around the clock. Wake up, read Playbook AM, get up to speed at midday with our Playbook PM halftime report, and fuel your nightly conversations with Inside Congress in the evening. Plus, never miss a beat with buzzy, real-time updates throughout the day via our Inside Congress Live feature. Learn more and subscribe here.     ON THE AIRWAVES: A trade group representing the vaping industry has launched a six-figure ad blitz going after Senate Majority Leader Chuck Schumer for his call for a crackdown on Zyn nicotine pouches, which he charges are being marketed to teenagers. — The 30-second spot from the Vapor Technology Association appears tailor-made to further stoke the ire of conservatives, with fear-mongering references to “the nanny state … working overtime.” The ad accuses Schumer and other “unelected bureaucrats” at FDA of carrying out “an all-out assault on your personal freedom to choose lower-risk tobacco-free nicotine products” that won’t end “until they have total control over you.” — The ad will run this week on Fox News and Fox Business Network during key timeslots, including during the network’s morning show “Fox and Friends,” the afternoon show “Kudlow” and popular evening talk show “The Five.” JOHNSON SPURNS AXIOM: House Speaker Mike Johnson’s political operation has cut ties with its principal PAC fundraising firm, Fundraising Inc., which is owned by Jeff Roe’s Axiom political consulting empire, two people familiar with the matter told Daniel. — No official reason was given to firm founder Alexandra Kendrick when she was notified of the decision a few weeks after Johnson became speaker, one of the people said. POLITICO reported last month that Trump has warned Republican politicians not to do business with Axiom given Roe’s key role in the super PAC of former primary rival Ron DeSantis. — Johnson had worked with Fundraising Inc., one of the biggest PAC fundraising firms in Washington, for seven years. He is now working with Republic Strategies, headed up by Ashlee Reid Morehouse. — A Johnson adviser declined to comment on the reason for the change, but noted that the speaker’s political operation has kept Axiom-affiliated general consultant Jason Hebert, although The Washington Post reported on Tuesday that Hebert “is expected to start billing his work for Johnson through a company not tied to Axiom.” Kendrick declined to comment. DEPT. OF CURIOUS TIMING: “Former President Donald Trump offered an olive branch to Anheuser-Busch on Tuesday, issuing a post on his social media platform calling on conservatives to drop their opposition to the besieged beer company,” our Hailey Fuchs reports. — “Trump’s post on Truth Social represents a major attempt at deescalation in a long-simmering feud between the political movement the former president leads and the mega corporation since April 2023, when it came under fire for a sponsored post with a transgender influencer.” — The message also came one month before Jeff Miller, a top Republican fundraiser who also happens to lobby for the company, is set to host a fundraiser for the former president featuring Trump’s son and more than 100 members of Congress, with tickets going for as high as $10,000 a pop. — “Miller declined to comment. Anheuser-Busch did not immediately return a request for comment. Trump, at one time, reportedly owned millions of dollars in stock in the company.” — “For almost a year, the company has drawn widespread condemnation from the MAGA influencers and Republican politicians. It even found itself in a congressional probe over allegations it was marketing beer to children. The drumbeat has continued up through last week, with conservatives targeting Kansas City Chiefs’ Travis Kelce, who has been a prominent Bud Light spokesperson.” — “Anheuser-Busch paid $260,000 to Miller’s firm in 2023, according to lobbying disclosure filings. The firm upped its quarterly fee by $20,000 in the second quarter of 2023 — around the time of the backlash.” FLY-IN SZN: Members of the Small Business Payments Alliance, another coalition of small business owners involved in the fight over credit card swipe fees — this time in opposition to changes to the status quo — is headed to the Hill this week to urge lawmakers against supporting Sen. Dick Durbin’s (D-Ill.) bill with Sen. Roger Marshall (R-Kan.). — The coalition will highlight a new report on Durbin and Marshall’s bill from the University of Miami that indicated the vast majority of any savings for merchants produced by the bill would flow to the largest retailers and hurt small businesses. Spokesperson Peter Kauffmann declined to name which members and offices the coalition plans to meet with, because after the group’s last fly-in, he said, “the big retailers used that to schedule follow-up meetings in favor of their bill.” — Another crowd of truckers, this time from the Texas Trucking Association, are in town for more than three dozen meetings with Texas lawmakers and staff from the Texas delegation. They’ll discuss how to avoid trade disruptions at the U.S.-Mexico border by ensuring Border Patrol agents are not pulled away from land ports of entry and reassigned to other points along the border, as well as energy and environment issues, lawsuit abuse, and ways to strengthen supply chains and workforce development, according to the American Trucking Associations. — More than 70 representatives from the Association for Community Affiliated Plans are in town as well. Among their asks: extending 12-month eligibility for Medicaid and CHIP to adults, support for legislation aimed at improving integrated care for people dually eligible for Medicare and Medicaid, and making permanent the enhanced tax credits for premiums for health care plans purchased on the Obamacare marketplace. SPOTTED at an NRCC fundraiser and dinner at Bistro Cacao last night hosted by Invariant, per a tipster: NRCC Chair Richard Hudson (R-N.C.), Reps. Frank Lucas (R-Okla.), Tom Cole (R-Okla.), G.T. Thompson (R-Pa.), David Valadao (R-Calif.), Michelle Fischbach (R-Minn.), Ashley Hinson (R-Iowa), Mike Carey (R-Ohio), Lori Chavez-DeRemer (R-Ore.) and Kelly Armstrong (R-N.D.); Drew Griffin, Lindley Kratovil Sherer, Katie Wise, Danielle Beck, Amy Swonger, Kelly Hitchcock, Tim Martin, Landon Stropko and Carolyn Coda of Invariant; Jeremy Wilson-Simerman and Rachel Michael of McDonald’s, Robin Bowen of the Corn Refiners Association, Elizabeth Brown of the Children’s Hospital Association, Gary Kline of Cigna Express Scripts, Dean Sackett of Franklin Templeton, Jennifer Stettner of Washington Gas, Michael Wall of The Aaron’s Company, Inc., Jeff Morehouse of Hudson’s office, Mike Thom of the NRCC, Andrew Renteria of Valadao’s office and Emily Hytha of Fischbach’s office. Jobs Report — Cozen O’Connor Public Strategies has promoted Towner French, Rose Christ and Joseph Hill to managing directors in the D.C., New York and Philadelphia offices respectively. — Henry Timms will be CEO of the Brunswick Group. He currently is the president and CEO of Lincoln Center for the Performing Arts. — Eric Baker has joined the Aspen Institute as media relations manager. He previously was associate director for communications at the Atlantic Council’s Digital Forensic Research Lab. — Melika Carroll is joining AI company Cohere as its first head of government affairs and public policy. She was previously senior vice president of corporate affairs at Sonder. — Chad Smith is now director of special projects at American Bridge 21st Century, per Morning Energy. He previously was deputy press secretary at DOE. — Samantha Segall has been promoted to vice president and head of government and public affairs at Datavant. Segall helped launch the company’s Washington office and will now help it expand into public affairs, and is a Ken Calvert and CLEAR alum. — Dame Amelia Chilcott Fawcett will be a senior adviser at the climate and nature investment and advisory firm Pollination. She was previously lead director at State Street. New Joint Fundraisers None. New PACs And Justice for All PAC (Super PAC) BETTER CALIFORNIA (Super PAC) Howard Energy Partners USA PAC (PAC) Louisiana Families First PAC (Super PAC) Madison Square Garden Entertainment Corp. PAC (MSG-FEDPAC) (PAC) Montanans for Public Lands (Super PAC) Stop the Madness Inc (Hybrid PAC) New Lobbying REGISTRATIONS Conaway Graves Group, LLC: Competitive Markets Action, Inc. Conaway Graves Group, LLC: National Automatic Merchandising Association (Nama) Farragut Partners LLP: Organize Fontenot Health Policy LLC: Impact Health Policy Partners Obo California Public Employees Retirement System Holland & Knight LLP: Automated.Connected.Electric.Shared Mobility Coalition, Inc. Impact Health Policy Partners: California Public Employees’ Retirement System (Calpers) Integer, LLC: Ren Acquisition Company LLC Madison Services Group, Inc: Women’s Procurement Circle (Informal Coalition) Madison Services Group, Inc: Women Veterans Business Coalition (Informal Coalition) Ms. Tami Wahl: Brandco Distributing LLC Ms. Tami Wahl: Just Amazing Creations LLC Mwmurray Consulting LLC: American Councils For International Education Mwmurray Consulting LLC: Gavi, The Vaccine Alliance The Mckeon Group, Inc.: Sci Acquisitions Co. Inc. The Nickles Group, LLC: Inspring LLC The Nimitz Group LLC: Avalon Action Alliance The Vogel Group: Terpene Belt Farms Torrey Advisory Group (Formerly Michael Torrey Associates, LLC): Ingredion Incorporated New Lobbying Terminations American Defense International, Inc.: Cytosorbents, Inc. Farragut Partners LLP: Organize Franklin Creek Consulting: The Bicycle Casino Granite Peak Strategies, LLC: Castle Mountain Venture Hobbs, Straus, Dean & Walker, LLP: Wyandotte Nation J. Michael Hall: Wynne Health Group On Behalf Of The Hepatitis B Foundation J. Michael Hall: Wynne Health Group On Behalf Of The Psychological Clinical Science Accreditation Jst Strategies LLC (Jochum Shore & Trossevin Pc): Broad Reach Power Meridian Hill Strategies Formerly Known As “Ernest C. Baynard Iv”: Msab Inc. National Health Advisors, LLC: Restorixhealth Okta, Inc.: Okta, Inc. Sherman Strategic Affairs, LLC: American Shrimp Processors Association The Campbell Consulting Group: Afl Telecommunications LLC The Nimitz Group LLC: Gold Star Wives Of America, Inc.   DON’T MISS POLITICO’S GOVERNORS SUMMIT: Join POLITICO on Feb. 22 to dive into how Governors are wielding immense power. While Washington remains gridlocked, governors are at the center of landmark decisions in AI and tech, economic development, infrastructure, housing, reproductive health and energy. How are they setting the stage for the future of American politics, policies and priorities? How are they confronting major challenges? Explore these questions and more at the 2024 Governors Summit. REGISTER HERE.       Follow us

To change your alert settings, please log in at https://www.politico.com/_login?base=https%3A%2F%2Fwww.politico.com/settings This email was sent to rouf@idiot.cloudns.cc by: POLITICO, LLC 1000 Wilson Blvd. Arlington, VA, 22209, USA Unsubscribe | Privacy Policy | Terms of Service