What Bailed-Out Banks Spend On Lobbying

By Matt Kelley,
Updated 19h 34m ago (11/7/2008 3:39 AM)
Courtesy Of USA TODAY

WASHINGTON — Nineteen banks taking taxpayer money from the Treasury Department have spent $32.4 million lobbying the federal government during the first nine months of this year, their lobbying disclosure reports show.

Combined, the Treasury is investing in the banks $159 billion from the $700 billion financial rescue package approved by Congress last month. None of the banks has indicated it plans to stop lobbying.

Lobbying by the financial industry before and during the financial crisis has come under criticism from consumer groups, members of Congress and President-elect Barack Obama.

"It's ridiculous that the perpetrators of this mess should be the people dictating to Congress how to get out of it," says Kathleen Day of the non-profit Center for Responsible Lending.
FIND MORE STORIES IN: Congress Barack Obama United States Treasury Department Merrill Lynch American Intl. Group International Group D-Calif Center for Responsible Lending Feinstein Financial Services Roundtable Scott Talbott Kathleen Day Joe Norton

Sen. Dianne Feinstein, D-Calif., began drafting a bill to ban recipients of government help from lobbying with taxpayer funds after learning that insurance giant American International Group continued to lobby after it received $123 billion in government-backed loans. AIG suspended its lobbying Oct. 20, company spokesman Joe Norton says.

In a statement, Feinstein said "it would be unconscionable for these companies to misuse taxpayer dollars" on lobbying. Although federal law prohibits federal loan, grant or contract money from being used for lobbying, Feinstein wants to ensure that ban also applies to the investments, loan guarantees and other emergency help offered to financial firms, Feinstein spokesman Gil Duran said.

Financial industry lobbyist Scott Talbott says such restrictions are unnecessary.

"Washington is watching. The world is watching. Companies will be able to show how they're using the money," said Talbott, a senior vice president of the Financial Services Roundtable, a trade group that represents 21 large banks getting government investments. "Lobbyist money will come out of other income."

Feinstein and others criticized AIG last month for sending executives on a $440,000 retreat after getting government help. AIG so far has spent $9.5 million on lobbying this year, records show.

Norton said AIG stopped working to influence legislation and regulations, but its lobbyists "continue to monitor policy and have general discussions" with lawmakers and regulators. He said AIG has no plans to fire its lobbyists or lobbying firms.

THE BALANCE OF INFLUENCE

Lobbying expenses for the first nine months of 2008 by some banks receiving government help:

Company --- Lobbying Amount --- Government Investment

Merrill Lynch{*} --- $4.6 million --- $25 billion

Bank of America{*} --- $4.7 million --- $25 billion

Citigroup $5.6 million $25 billion

JPMorgan Chase --- $5 million --- $25 billion

Wells Fargo --- $2 million --- $25 billion

Goldman Sachs --- $4.2 million --- $10 billion

Morgan Stanley --- $2.4 million --- $10 billion

PNC Bank --- $320,000 --- $7.7 billion

U.S. Bancorp --- $290,000 --- $6.6

Capital One --- $920,000 --- $3.6

* — Merrill Lynch is being taken over by Bank of America, and the merged bank will receive $25 billion

Sources: Lobbying disclosure reports, U.S. Senate Office of Public Records, Financial Services Roundtable