Freddie’s New Friend

Posted July 15, 2003 at 6:03pm

When accounting problems were discovered at housing giant Freddie Mac, the company’s board of directors followed a now-familiar step to rebuild the firm’s credibility on Wall Street — they fired the top two officials at the company. [IMGCAP(1)]

Now comes word that the housing giant also has followed a well-beaten path to rebuild its reputation on Capitol Hill — it has added a bevy of outside lobbyists to its side.

According to the most recent lobbying disclosure forms, Freddie Mac added a handful of lobbyists to the already-long roster of outside firms it has relied on since the accounting irregularities were discovered earlier this year.

Among the top hires are Republican heavyweights Susan Hirschmann, a former chief of staff to then-House Majority Whip Tom DeLay (R-Texas) now with Williams & Jensen; and Mitch Bainwol, who served as staff director for Senate Majority Leader Bill Frist (R-Tenn.) before heading to K Street.

Freddie Mac also brought on outside lobbyists David DiStefano, Jeffrey Walter, Paul Equale and Laurie Sullivan.

Sullivan is a partner with Sullivan & Baldick, a firm she founded with Nick Baldick, a Democrat political strategist who has taken a leave to run Sen. John Edward’s (D-N.C.) presidential campaign.

The additions come a few months after Freddie Mac sought to bolster its ties with the Republican Party by hiring the Alexander Strategies Group, a GOP lobbying firm headed by former DeLay aides Ed Buckham and Tony Rudy. Also at Alexander Strategies is Terry Haines, a former staff director to House Financial Services Chairman Mike Oxley (R-Ohio), whose committee has jurisdiction over Freddie Mac.

MCI Reaching Out to Washington. MCI, once one of the most politically active companies in town, has launched a public relations offensive to rebuild its tarnished reputation with some Members of Congress and the Bush administration.

The public relations effort is being run by the powerful firm Patton Boggs LLP, which has been the bankrupt long distance company’s longtime representative in town.

MCI also has called for assistance from Anne Wexler and former Rep. Bob Walker (R-Pa.) of the Wexler Walker Group, as well as Manus Cooney, a former GOP staff director on the Senate Judiciary Committee.

Cooney’s former boss, Judiciary Chairman Orrin Hatch (R-Utah), plans to hold a hearing on whether MCI should be allowed to use its bankruptcy to shed much of its debt.

Hatch isn’t the only Senator taking aim at MCI. The Governmental Affairs Committee wants to know how MCI continues to land massive government contracts and the Finance Committee may take up legislation authored by Senate GOP Conference Chairman Rick Santorum (Pa.) that could jack up the company’s tax bill.

In addition to the new lobbying effort, MCI has purchased ads in The Washington Post and a pair of Capitol Hill newspapers, including Roll Call, to make its case that the company has shed its past practices.

“We are very interested in making sure that policymakers, regulators and Members of Congress understand that MCI is a 55,000-person company,” said an MCI official working on the campaign.

The company has a new CEO, CFO and an entire new board of directors that includes a former U.S. attorney and onetime head of the federal accounting oversight board.

“The few bad apples are gone,” the official said, “and we want people to understand what we have done to change.”

Livingston Expanding, Yet Again. Just off the news of a key new hire that will broaden his lobbying practice, former Rep. Bob Livingston (R-La.) has announced that his firm, the Livingston Group, has joined forces with a former Democratic Congressman.

But instead of expanding his base in the United States, Livingston is looking overseas.

With former Rep. Toby Moffett (D-Conn.), Livingston is forming the Livingston-Moffett International Group Practice, which will specialize in representing foreign governments and non-U.S. companies.

Some clients already lined up for the new practice include Caithness Energy, De La Rue, the governments of Morocco, Turkey and the Cayman Islands, and AFTECH, an Africa distance learning and workforce development project.

Frist Among Equals. A few months after leaving one of the most powerful positions in the Senate, Republican Mitch Bainwol has signed up a handful of lucrative clients for his new lobbying firm.

According to the most recent lobbying disclosures, Bainwol spends a lot of his time these days working on legislation to reform asbestos litigation. Bainwol represents the American Immune Association and the American Insurance Association on the issue.

He also registered to lobby for Freddie Mac on legislation that would affect government-sponsored entities.

Other clients include St. Paul, Oracle and U.S. Oncology.

Bainwol briefly served as Senate Majority Leader Bill Frist’s (R-Tenn.) chief of staff before leaving for K Street. Bainwol helped Republicans take back control of the Senate as executive director of the National Republican Senatorial Committee during Frist’s time as chairman there.

Ullico Retains New Representation. Ullico, the union-owned insurance giant facing scrutiny for questionable stock transactions by some of the company’s senior officials, has brought on additional counsel.

The firm Dickstein Shapiro Morin & Oshinsky, according to lobbying filings culled by PoliticalMoneyline.com, will help navigate Ullico through Congressional hearings.

Miss America to Fight Crime, Help Kids. Just as the summer tourist season winds down after Labor Day, the 51 Miss America contestants will invade D.C. in advance of the annual Atlantic City pageant in September. Their cause: a fundraising effort for Fight Crime: Invest in Kids, a national anti-crime group that supports children’s organizations.

The Sept. 5 fundraising dinner will be held at the Washington Hilton, with the contestants joining forces with current Miss America Erika Harold.

Puerto Rico’s Top Lobbyist Coming to D.C. The governor of Puerto Rico will be meeting with the Senate Finance Committee today and tomorrow to discuss complicated tax incentives that have benefited the U.S. commonwealth.

Legislation that will soon emerge from the committee will replace tax incentives repealed in 1996. The governor, Sila Calderon of the Popular Democratic Party, says tax incentives that were originally instituted in 1946 under “Operation Bootstrap” have helped Puerto Rico to boast the highest standard of living in Latin America.

Keeping Checks on Mr. Murdoch. As many in the media industry are watching the progression of the proposed mega-merger between Rupert Murdoch’s News Corp. and satellite distributor DirectTV, a number of smaller cable companies have joined forces to represent their interests. They, in turn, are represented by Williams & Jensen.

But Advance/Newhouse, CableOne, Insight Communications and Cox Communications aren’t launching a David versus Goliath fight against the colossal powers of Murdoch; they instead want to keep his powers in check. The smaller cable companies want to ensure that a number of market safeguards proposed by Murdoch survive the merger approval process, according to a source.

Rooting Out Invading Forces. A former aide to House Resources Chairman Richard Pombo (R-Calif.) has registered a family-owned feed and seed company to monitor invasive species legislation.

Michael Hardiman, and his media and public affairs firm Hardiman Consulting, is representing Grasslyn Inc., based in State College, Pa.