Dodd Courts Lobbyist
A Possible Return for Lowenthal
As lawmakers struggle to contain the fallout from the widening housing crisis, a lobbyist for mortgage brokers is in talks to leave his K Street perch to become a top staffer to Senate Banking, Housing and Urban Affairs Chairman Chris Dodd (D-Conn.).
Andrew Lowenthal, a former Dodd aide who started lobbying in 2001, would become chief of staff in the Connecticut Democrat’s personal office, several people with knowledge of the situation confirmed. Since 2006, Porterfield & Lowenthal — a firm he co-founded that year with former Senate GOP staffer Lendell Porterfield — has collected $480,000 lobbying for the National Association of Mortgage Brokers.
The group has fought attempts by consumer advocates and some lawmakers, including Dodd, to crack down on what they call abusive practices by brokers to lure borrowers into loans they cannot afford.
“The Senator is in the process of hiring a new chief of staff, and we’re not going to comment until that process is complete,” Dodd press secretary Bryan DeAngelis said.
Because of the talks, said one person familiar with the firm, Lowenthal is no longer lobbying for any clients. If hired, he would replace Sheryl Cohen, who has joined the lobby shop, American Continental Group. Lowenthal declined to comment.
In a statement, Porterfield, a former staff director of the Banking Subcommittee on Financial Institutions, said, “While Andrew is in discussions to go back to the Federal Government, the process is not yet complete. If he does return, we wish him well and trust he will serve the government with the same distinction he has served here at the firm. Should he leave, the firm will continue to effectively represent our clients in the most professional and ethical manner.”
Consumer advocates have criticized Dodd for neglecting a concerted response to the gathering mortgage meltdown last year while he pursued a presidential bid that was fueled in large part by hefty contributions from the financial services industry. Since returning to the Senate this year, they have given him mostly positive marks for his effort — though many point out much work remains to be done.
Dodd is working with House Financial Services Chairman Barney Frank (D-Mass.) to craft a measure that would allow the Federal Housing Administration to refinance up to $400 billion in distressed mortgages. And he is pushing the Home Ownership Preservation and Protection Act, a bill he authored to establish new protections for borrowers. The measure has drawn fire from the National Association of Mortgage Brokers, which argues it would disadvantage small businesses and drive consumers to big banks.
The bill would give brokers a fiduciary responsibility to act in the best interest of their clients, and it would ban them from receiving a type of bonus that consumer advocates say encourages them to lock clients into loans with unfavorable terms.
The group supported a House companion measure, approved last year, that lacked both provisions. In February, Lowenthal’s firm signed up to lobby for Wachovia Bank on the Dodd bill, Senate records show. A company spokeswoman declined to comment.
Lowenthal would hardly be the first lobbyist to take a backward spin through the revolving door, one that usually sends Hill staffers to lucrative jobs downtown.
About 20 lobbyists reportedly took jobs in the ranks of House Democratic leadership and on committee staffs last year. Among them were Dennis Fitzgibbons, who left DaimlerChrysler to become staff director of the Energy and Commerce Committee; Gregg Rothschild, who left Verizon to become general counsel of the same committee; and Dan Turton, who left Timmons & Co. to become staff director of the Rules Committee.
On the Senate side, freshman Sen. Claire McCaskill (D-Mo.) tapped AT&T lobbyist Sean Kennedy to serve as her chief of staff.
House Republicans tried to highlight the practice as ethically problematic during debate over lobbying reform legislation last year.
Their alternative to the plan crafted by Democratic leadership included a provision that would have banned lobbyists turned staffers from meeting with their former employers for one year after leaving downtown. The proposal did not make it into the bill’s final version.
Like most lobbyists, Lowenthal started out on the Hill. He worked for Dodd in the 1990s, serving as minority staff director of the Banking Subcommittee on Securities, Insurance and Investment.
He left that job in 1999 to serve as legislative director for Sen. Evan Bayh (D-Ind.), a post he held for less than a year before moving to the Commodity Futures Trading Commission as chief of staff.
In 2001, he took a job with Freddie Mac, serving as director of government relations until 2003, when he joined the firm Van Scoyoc Associates. He and Porterfield left that shop in 2006 to start their own venture.
The firm quickly built an impressive book of business, largely consisting of financial services industry clients.
It includes the American Bankers Association, Freddie Mac, a hedge-fund group called the Coalition of Private Investment Companies, and Nasdaq. During the firm’s first year in business, it pulled in $975,000 in revenue, according to a tally by CQ MoneyLine. In 2007, that total jumped to $1.72 million.