Silicon Valley Bank (SVB) President and CEO Greg Becker speaks during the Milken Institute Global Conference on May 3, 2022 in Beverly Hills, California.
Patrick T Fallon | AFP | Getty Images
Before Silicon Valley Bank’s failure, its former CEO Greg Becker backed two tech industry lobby groups trying to influence the Dodd-Frank financial reform bill and pushing for corporate tax cuts, according to records verified by CNBC.
In the run-up to the collapse of the bank, Becker presidency a group called TechNet and was a board member of the Silicon Valley Leadership Group, two trade organizations that have advocated with government officials on a range of company-related issues. Becker resigned as TechNet chairman earlier this year, but remained on the group’s board of directors until Monday, when he resigned.
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Both trade organizations accepted Silicon Valley Bank as a member prior to their failure, according to archived versions of their websites. Current members of both organizations include tech giants Google, Amazon, Meta and Apple.
SVB collapsed under pressure after customers withdrew a staggering $42 billion last week. Days after the bank was forced to close on Friday, regulators halted SVB customer deposits as part of a series of measures to stem the damage from its collapse. Regulators later appointed Tim Mayopoulos as chief executive of the SVB.
Lobbying by trade groups linked to Becker and SVB contributes to a number of Attempts to influence politics that has caught the attention of lawmakers since the bank failed. Some members of Congress have asked for more information about the practices that have left the bank vulnerable and its drive to eliminate regulations, along with Becker’s sale of more than $3 million in stock in late February.
Sen. Elizabeth Warren, D-Mass., member of the Senate Banking Committee, sent a letter to the bank’s board of directors, asking him to “describe the full extent of your efforts to reverse the Dodd-Frank regulations in Congress.” Warren and other lawmakers are now pointing to the bank’s failure as justification for tightening safeguards in the financial industry, including by repealing a 2018 law that relaxed the Dodd-Frank rules.
When Becker ran TechNet, the group piled money into shaping federal policy — pieces included by Dodd Frank. The organization has spent more than $2 million lobbying Congress since the beginning of 2020, according to its lobbying disclosure reports.
TechNet spent $1.84 million on 20 internal and external lobbyists last year, the highest investment in lobbying since 2005, according to data from nonpartisan watchdog OpenSecrets. The trading group had huge coffers to draw from: It brought in more than $4.2 million in membership dues in 2020, according to its most recent financial disclosure form filed with the Internal Revenue Service.
TechNet focused in part on “Section 1033 of the Dodd-Frank Consumer Protection Act,” according to its disclosure reports. Records show that the group worked with House and Senate lawmakers and officials from the Consumer Treasury Protection Bureau on the consumer disclosure-related provision.
Steve Kidera, a spokesman for TechNet, told CNBC that the group’s “disclosed lobbying on Section 1033 was a consumer privacy issue related to the announced disclosure of proposed rulemaking at the CFPB on privacy, one of the top policy issues in our industry.”
Section 1033 was established under the sweep Financial reform legislation signed by former President Barack Obama after the 2008 financial crisis.
The CFPB says Section 1033 “is in the process of writing implementing regulations” that would require financial institutions such as Silicon Valley Bank “to provide consumers, upon request, with transaction data and other information about a consumer financial product or service that the consumer obtains from.” of the affected unit.”
Although the lobbying disclosures don’t explain whether TechNet supports or opposes Section 1033 as written, the organization clearly wants a say in how the rule is implemented.
The group’s policy principles for 2023 state that it aims to “establish robust consumer data directly through Section 1033 rulemaking that encourages the free flow of consumer-authorized data throughout the financial ecosystem.” TechNet added that it “supports a flexible, consent-based framework to inform consumers about how their information is shared, transferred, stored, and used.”
The other trade organization for which Becker sat on the board has dug into its own deep pockets to influence politics. The Silicon Valley Leadership Group raised $1.3 million in donations in 2020 and raised an additional $2.9 million through membership dues, according to records filed with the IRS.
Their 2021 records, provided to CNBC by the organization following a request, show that they earned almost the same amount in membership dues that year. According to records, the group raised over $940,000 through donations in 2021.
The organization boasts on its website that it has “supported comprehensive corporate tax reform, including lowering the corporate tax rate and moving to a hybrid/territorial international tax regime.”
The corporate tax rate last fell in 2017. Former President Donald Trump signed into law GOP tax cuts, lowering the rate from 35% to 21%.
Laura Wilkinson, a spokeswoman for the Silicon Valley Leadership Group, told CNBC that Silicon Valley bank executives are part of her group’s coalition of dozens of member companies that met with House and Senate lawmakers on Capitol Hill in 2017 for lowering the corporate tax rate.
“We are focused on strengthening competitiveness by fighting for a fair corporate tax system at the local, state and federal levels,” Wilkinson said. “2017 included joining the broad coalition of high street corporations and innovation leaders working for a simpler and fairer tax system as part of a broader tax reform to support economic growth and American jobs.”
Federal filings show that the Silicon Valley Bank Leadership Group has not filed any lobbying disclosure reports since 2009.
Becker served as chairman of the Silicon Valley Leadership Group from 2014 to 2017, according to an archived version of his SVB bio page. Becker could not be reached for comment.
SVB and Becker support Democrats
While pursuing political goals that sometimes clashed with Democrat priorities, SVB and Becker often gave money to the party’s candidates.
Becker’s only federal donation in the 2022 election cycle went to Senate Majority Leader Chuck Schumer, DN.Y., according to Federal Election Commission records. Schumer shares the input his campaign received from both Becker and the bank’s PAC charities.
Since 2011, the year Becker became CEO and president of the SVB, his political action committee has given the majority of its donations to Democrats in every election cycle, according to OpenSecrets. The exception came in 2012, when Republicans retained control of the House of Representatives even when Obama won re-election.
Senator Mark Warner, D-Va., a member of the Senate Banking Committee, also received input from Becker. According to Federal Election Commission records, Warner received $11,400 from the ex-bank CEO over the course of the 2020 and 2022 election cycles. Sen. Jon Tester, D-Mont., was reported to have received $3,000 from the bank’s PAC in 2017 FEC records.
Becker also hosted a fundraiser for Warner at his California home in 2016, according to one invite to the assembly. Warner and Tester officials will not say if they plan to donate any of the funds they received from Becker or the bank’s PAC.
The veteran legislatorhave voted for the 2018 law that rolled back parts of Dodd Frank.
The bill her supports reclassified the “too big to fail” standard under Dodd Frank, which was accompanied by increased regulatory scrutiny. By raising the regulatory threshold for banks from $50 billion in assets to $250 billion, mid-sized banks have been exempted from these regulations. Becker, in testimony he presented to a Senate panel in 2015, made a similar demanding that his and other mid-sized banks be exempted from the Dodd-Frank rules.
The Federal Deposit Insurance Institution, which helped to protect SVB depositors, called before the bank’s closure, that the company had total assets of about $209 billion – which would have subjected it to those rules prior to 2018.
Source : www.cnbc.com