HOW PEOPLE CLOSE TO JOE CROWLEY HAVE GOTTEN RICH WHILE THE QUEENS BOSS HAS RISEN IN CONGRESS

Category Other
Posted Date 06/14/2018
Publish By
Publish Date 06/14/2018
Rating Neutral

THE RISE OF Congressman Joe Crowley, D-N.Y., has coincided with lucrative lobbying contracts for his younger brother, John Crowley, an attorney who goes by the first name Sean, and previously specialized in wills and estate law.

Sean Crowley serves as a partner at Davidoff Hutcher & Citron LLP, a powerhouse law firm with offices in Albany, New York City, and Washington, D.C., that advertises its ability to connect clients with congressional leadership.

Over the last decade, clients with interests before Congress have retained Sean Crowley through his lobbying firm, paying more than $4.5 million to influence and monitor government policies, according to a review of contracts by The Intercept.

Clients in recent years have included Oracle, AbbVie, NBCUniversal, Juniper Systems, New York Community Bancorp, Abbott Labs, and Elections Systems & Software.

In many cases, the interests of Sean Crowley’s clients have overlapped with his elder brother’s legislative and political work.

In 2015, Joe Crowley voted in favor of legislation to nullify a rule established by the Consumer Financial Protection Bureau designed to prevent racial discrimination in the auto loan industry.

The legislation was heavily promoted by the National Automobile Dealers Association, the New York affiliate of which retains Sean Crowley as a lobbyist on regulatory issues, including city rules meant to curb predatory lending practices.

In 2013, Joe Crowley helped award $10 million in federal assistance to the Hunts Point Terminal Produce Cooperative, a merchants association in the Bronx that retained Sean Crowley as a lobbyist.

In 2009, both Crowley brothers worked to assist the life insurance settlement industry. A few months after President Barack Obama’s inauguration, Joe Crowley, newly empowered with his first major leadership post at the Democratic Congressional Campaign Committee and a perch on the powerful committee dealing with tax legislation, traveled to Orlando, Florida, to address hundreds of financial representatives.

Joe Crowley, speaking to the Life Insurance Settlement Association’s annual meeting, reassured executives, and noted that Obama had made no mention of life insurance or life insurance settlements during his recent speech outlining his tax agenda, suggesting the audience might be spared from any future tax hikes.

“I think for your industry, that is a good thing,” said Crowley. “It doesn’t mean that you’re out of the woods, but it’s a good thing.”

The congressman encouraged the attendees to contact Democratic lawmakers on the Ways and Means Committee and continue to lobby to share their views.

The friendly chat coincided with a lucrative contract for Crowley’s younger brother, Sean, who was retained by the Life Insurance Settlement Association earlier that year to influence tax legislation on Capitol Hill. Sean Crowley’s lobbying firm, Davidoff Hutcher & Citron, went on to collect $140,000 on behalf of the life insurance settlement client.

The engagement with the life insurance settlement lobby also provided a lift to Joe Crowley. He was the largest recipient of Life Insurance Settlement Association political action committee donations during the 2010 election cycle.

Despite overlapping interests, officials on behalf of both brothers strongly deny that Sean has ever lobbied his elder brother.

“Sean Crowley has never lobbied the congressman’s office as we have a long-standing policy in place that prevents him from doing so,” a spokesperson for Joe Crowley emailed The Intercept, when asked about Sean’s lobbying activities.

Sid Davidoff, founding partner of Davidoff Hutcher & Citron, said in a statement to The Intercept that, “Sean Crowley has never lobbied Congressman Joe Crowley, nor will he.”

A report last year in the New York Post revealed that Joe Crowley has also paid nearly $70,000 in campaign funds to a company owned by Sean, called Killean Enterprises LLC. Joe Crowley claimed the money was rent for a campaign office, though the space owned by the younger Crowley brother is outside the district.

Before working as a lobbyist, Sean served as an attorney at a firm called Crowley, Crowley & Kaufman, a partnership with Scott Kaufman, the treasurer of Joe Crowley’s political action committee.

Joe Crowley has faced years of headlines charging that he engages in nepotism and unethical political patronage. As the boss of the Queens Democratic Party, he has nominated associates to the borough election commission, helped allies win election to the New York City Council, and appointed family friends to the Queens Surrogate’s Court.

The court appointments have gained increasing scrutiny after reports that associates of Joe Crowley are routinely selected as court-appointed guardians who have earned millions of dollars processing the estates of residents who pass away without establishing a will. Gerard Sweeney, an official at the Queens Democratic Party and a Crowley lieutenant, has raked in over $30 million administering estates through his position as an administration attorney at the Surrogate’s Court, which he won through his relationship with Joe Crowley.

Before becoming a lobbyist, Sean Crowley also served as a court-appointed guardian. Kaufman has continued to serve as one, earning around $550,000 from work assigned through the Surrogate’s Court. Notably, Kaufman now faces a state ethics probe for potentially violating court administration rules on compensation.

Sweeney also serves as a partner at Sweeney, Reich & Bolz, a law firm formed with two other members of the Queens Democratic Party leadership. The law firm represents banks and other financial institutions in foreclosure proceedings at the Queens Surrogate’s Court — known in the industry as a foreclosure mill — an arrangement that raised conflict of interest concerns. To the extent that political machines have earned legitimacy in the past, it has come through their ability to shower constituents with jobs and services in exchange for remaining in power. That Crowley’s machine instead forecloses on constituents upends that relationship.

Leading New York mortgage lenders, according to the Village Voice, have used the Sweeney law firm to process foreclosures for homeowners throughout the Queens area who have fallen behind on mortgage payments following the housing crisis in 2008. Sean, meanwhile, has lobbied on behalf of the New York Creditors Bar Association, a trade group for debt collection attorneys, on state legislative issues.

THE CONVERGENCE OF business and politics in the Queens Democratic machine reflects Joe Crowley’s ascent through the ranks of House Democratic leadership.

Joe Crowley has gathered power through high-level connections with well-placed political figures and business leaders. The previous lawmaker to serve in his seat, Rep. Thomas Manton, D-N.Y., another Queens Democratic Party boss, quietly selected Crowley as his successor just before the legal filing deadline in 1998, while deceiving the public and claiming he would run for re-election, a strategy that effectively prevented a competitive election.

In Congress, Joe Crowley has served as a liaison between K Street and the Democratic Party, often mobilizing opposition to bank regulations and other rules opposed by major donors to the party. In 2005, he won a low-ranking position with the DCCC, helping to serve on an outreach council to the business community. But Joe Crowley proved a prodigious fundraiser, helping to raise $5 million for the party, a capability that catapulted him to serve as vice chair of the DCCC four years later.

In 2009, he was elected as the leader of the New Democrat Coalition, a moderate caucus that used its political weight to weaken financial reform. The coalition famously threatened to defeat the Dodd-Frank financial reform law unless amendments were added to provide less stringent rules on derivatives and pre-emption of stronger state-based bank regulations. As Joe Crowley and other New Democrat leaders marshaled political support for changes to the bill, the lawmakers went on a rapid fundraising spree, collecting checks from Wall Street banks that were seeking to influence the legislation.

The Office of Congressional Ethics opened an investigation into Joe Crowley’s financial reform-related fundraisers, though the House Ethics Committee, which outranks the OCE and is stacked with fellow lawmakers, later declined to continue the probe.

In the years since passage of financial reform, Joe Crowley has continued to chip away at tough rules on banks while vacuuming up Wall Street donations. In 2011, he co-authored a letter requesting that regulators withdraw and revise the fiduciary rule, a high-profile consumer safeguard designed to ensure that financial planners act only in the interests of their clients. The following year, after meeting with bank executives, Joe Crowley and other New Democrats sent a letter to regulators requesting a delay to the Volcker Rule, one of the signature restrictions on big banks, designed to prevent reckless proprietary trading.

The letters, again, coincided with a steady flow of bank and corporate contributions to Joe Crowley’s political action committees, which include a leadership PAC, a joint fundraising committee, and a personal PAC. Following the 2016 election, Joe Crowley was elected as chair of the House Democratic Caucus, making him the fourth ranking member in leadership.

Now, the Trump administration has signaled that it is working to unravel both provisions of financial reform criticized by Joe Crowley’s letters and is making headway in relaxing other aspects of the Dodd-Frank law. That Joe Crowley previously targeted the same financial regulations that are now in the crosshairs of Trump contrasts sharply with the image the Queens Democrat has portrayed in his campaign advertising, which depict him as a bold opponent of the president.

Despite a relatively conservative voting record while representing a deeply Democratic district — Crowley not only has been a consistent friend to the banking lobby, but voted for the Iraq War, the Patriot Act, and a controversial bill in 2005 to limit consumer bankruptcy protections — he is currently maneuvering to become the next speaker of the House.

Last month, members of the New Democrat caucus provided strong support for a Republican-led bill to increase the bank threshold for systemic risk assessments, raising the size at which regulators provide additional scrutiny from $50 billion to $250 billion in bank assets.

Facing pressure from Alexandria Ocasio-Cortez, a progressive challenging Joe Crowley in the Democratic primary on June 26, the Queens Democratic Party chief abandoned his moderate pro-bank colleagues. This time, he bucked his New Democrat colleagues and voted against the bill weakening Dodd-Frank. He also voted last month against legislation rescinding the CFPB’s auto lending rule, legislation he had endorsed three years ago. Crowley, facing a tightening race, has begun to spend heavily on television to stave off a major upset, and has agreed to debate Ocasio-Cortez. (It will air Friday on NY1 in the 7:00 hour.)

On Wednesday, Crowley attempted to commit civil disobedience against the Trump administration’s policy of separating children from their immigrant parents at the border, calling it “fascist.”

Jonathan McCollum, director of federal government relations at Davidoff Hutcher & Citron LLP, where Sean Crowley serves as a partner, praised the outcome of the Dodd-Frank rollback legislation in an interview with MarketWatch. “A bipartisan coalition in Congress has recognized that Dodd-Frank imposes enormous burden on mid-sized regional banks,” said McCollum. In an interview with NBC News, McCollum noted that his firm represents banks that have sought these changes.

Now, in the final two weeks of the Democratic primary, Joe Crowley is touting an impressive list of local and federal endorsements, claiming that his deep bench of political support shows that voters should re-elect him.

Many Democratic lawmakers have endorsed him, as have members of the New York City Council.

“Congressman Crowley has shown that he has the intelligence and determination to deliver for LGBT Americans. I know he will continue to help make historic gains for our community and I am proud to endorse him,” said City Council Member Daniel Dromm. Jimmy Van Bramer, another council member, provided a similar statement of strong support.

But campaign cash is never far from the situation. Records reviewed by The Intercept show that the Crowley for Congress committee and the law firm formed by Joe Crowley’s campaign treasurer, Scott Kaufman, and his brother, Sean, have contributed over $1 million to local and state New York committees, including the accounts controlled by Dromm ($5,800) and Van Bramer ($5,250).

Joe Crowley’s PACs have further provided over $2.5 million to the DCCC and over $3 million in direct campaign transfers over the last decade to other Democratic politicians, including nearly every Democratic lawmaker to endorsement him in recent days, such as Rep. Grace Meng and Sen. Kirsten Gillibrand.

Correction: June 14, 2018, 4:50 p.m.
An earlier version of this story stated that earlier this year Joe Crowley voted in favor of nullifying a Consumer Financial Protection Bureau rule to prevent racial discrimination in the auto loan industry. In fact, he voted for it in 2015. This story was also updated to include that Crowley voted against similar legislation last month.

DISCLAIMER: The trademarks and copyrighted material found on this page are property of their respective owners.