Bloomberg Hits Federated Lobbying
Bloomberg writes "Obscure Rule to Fix $2.7 Trillion Market Draws Tireless Opponent," which says, "It's an obscure rule that few people understand, but its backers hope it will correct a crucial flaw in a $2.7 trillion market whose collapse in 2008 froze financial transactions around the world. There's one snag: the relentless bulldogs at Federated Investors Inc. The family-run investment manager that oversees $367.2 billion in assets has outlasted larger firms like BlackRock Inc. and Fidelity Investments in the fight to persuade Congress that the regulation should never take effect. Federated has built a sophisticated lobbying operation, bankrolling lawmakers' political campaigns and recruiting state officials to press its case." The piece adds, "While the effort faces long odds, the push has produced successes. Congress is currently considering bipartisan legislation to reverse one of the most sweeping post-crisis financial reforms -- one governing money-market mutual funds. There's some urgency, as the rule is set to go on the books in October." Bloomberg quotes Peter Crane of Crane Data, "This is a bill for one company: Federated.... This fight has gone on for years, but they're the only ones still lobbying." The article adds, "Pittsburgh-based Federated, the fourth-biggest U.S. money-market firm, spent $960,000 on lobbying this year and $1.37 million last year on lobbyists inside and outside the company, the most in at least a decade, according to public filings. Republican Senator Patrick Toomey introduced legislation last year that would reverse the SEC rule. He's locked in a close race in Federated's home state of Pennsylvania and has been the firm's top recipient of campaign cash, according to data from the Center for Responsive Politics. Federated was Toomey's third-biggest contributor the last five years, the data show.... The unique part of Federated's lobbying strategy is the company's role in building a network of state officials to press its case. Many of them are members of the Coalition to Protect Investor Choice, which advocates for legislation to reverse the money-fund rules. The alliance gets funding from Federated and has spent $148,500 on federal lobbying since its inception in November." For more, see Crane Data's March 8 News, "Long Shot Legislation Could Keep All Money Funds Stable, Ban Bailouts."
