Silicon Valley Financial institution ex-CEO Greg Becker backed Large Tech lobbying teams
Greg Becker, President and CEO of Silicon Valley Financial institution (SVB), speaks throughout the Milken Institute World Convention on Could 3, 2022 in Beverly Hills, California.
Patrick T. Fallon | AFP | Getty Photos
Earlier than Silicon Valley Financial institution’s failure, its former CEO Greg Becker backed two tech business lobbying teams that attempted to affect the Dodd-Frank monetary reform regulation and pushed to chop company taxes, in keeping with information reviewed by CNBC.
Within the buildup to the financial institution’s collapse, Becker chaired a gaggle referred to as TechNet and was a board member of the Silicon Valley Management Group, two commerce organizations which have lobbied authorities officers on a variety of points tied to the agency. Becker stepped down as chairman of TechNet in the beginning of the yr however remained on the group’s govt council till Monday, when he resigned.
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Each commerce organizations included Silicon Valley Financial institution as a member earlier than its failure, in keeping with archived variations of their web sites. Present members of each organizations embrace tech giants Google, Amazon, Meta and Apple.
SVB collapsed underneath strain after prospects withdrew a staggering $42 billion final week. Days after the financial institution was pressured to shut on Friday, regulators backstopped SVB buyer deposits as a part of a number of strikes to include the injury from its failure. Regulators later appointed Tim Mayopoulos to run SVB.
The lobbying by commerce teams linked to Becker and SVB provides to a string of efforts to affect coverage that has drawn lawmakers’ consideration because the financial institution failed. Some members of Congress have sought extra info on the practices that left the financial institution weak and its push to chip away at laws, together with Becker’s sale of greater than $3 million in inventory in late February.
Senate Banking Committee member Sen. Elizabeth Warren, D-Mass., despatched a letter to the banking govt asking him to “describe the complete scope of your efforts to roll again Dodd-Frank laws in Congress.” Warren and different lawmakers are actually pointing to the financial institution’s failure as justification to tighten safeguards across the monetary business, together with by rolling again a 2018 regulation that loosened Dodd-Frank guidelines.
When Becker led TechNet, the group piled money into shaping federal coverage — together with items of Dodd-Frank. The group has spent greater than $2 million because the begin of 2020 on lobbying Congress, in keeping with its lobbying disclosure reviews.
TechNet spent $1.84 million final yr on 20 in-house and exterior lobbyists, probably the most it invested in lobbying since 2005, in keeping with knowledge from the nonpartisan watchdog OpenSecrets. The commerce group had huge coffers to attract from: it introduced in additional than $4.2 million in membership dues in 2020, in keeping with its most up-to-date monetary disclosure type filed with the IRS.
TechNet centered its lobbying, partially, on “Part 1033 of the Dodd-Frank Client Safety Act,” in keeping with its disclosure reviews. The group engaged with Home and Senate lawmakers, in addition to Client Monetary Safety Bureau officers, on the availability associated to shopper disclosures, information present.
Steve Kidera, a spokesman for TechNet, advised CNBC that the group’s “disclosed lobbying on Part 1033 was a shopper knowledge privateness difficulty associated to the introduced discover of proposed rulemaking on the CFPB on knowledge privateness, one among our business’s high coverage points.”
Part 1033 was established underneath the sweeping monetary reform laws, which former President Barack Obama signed into regulation after the 2008 monetary disaster.
The CFPB says it’s “within the strategy of writing laws to implement” part 1033 which might require monetary establishments resembling Silicon Valley Financial institution to “make obtainable to shoppers, upon request, transaction knowledge and different info regarding a shopper monetary services or products that the patron obtains from the coated entity.”
Although the lobbying disclosures don’t clarify whether or not TechNet helps or opposes part 1033 as written, the group clearly needs to have a say in how the rule is carried out.
The group’s 2023 coverage rules say it needs to ascertain a “sturdy shopper knowledge proper by means of a Part 1033 rulemaking that promotes the free circulation of shopper approved knowledge throughout the monetary ecosystem.” TechNet added that it helps “a versatile, consent-based framework for notifying shoppers of how their info can be shared, transmitted, saved, and utilized.”
The opposite commerce group for which Becker held a board seat has reached into its personal deep pockets to affect coverage. The Silicon Valley Management Group in 2020 raised $1.3 million in contributions and introduced in an extra $2.9 million by means of membership dues, in keeping with the information filed to the IRS.
Its 2021 information, which had been supplied to CNBC by the group after an inquiry, exhibits they introduced in nearly the identical quantity in membership dues that yr. The group raised over $940,000 by means of contributions in 2021, in keeping with the information.
The group boasts on its web site that it “supported complete company tax reform, together with reducing the company revenue tax price and transferring towards a hybrid/territorial worldwide tax system.”
The company tax price most lately dropped in 2017. Former President Donald Trump signed GOP tax cuts into regulation, chopping the speed to 21% from 35%.
Laura Wilkinson, a spokeswoman for Silicon Valley Management Group, advised CNBC that Silicon Valley Financial institution executives had been a part of their group’s coalition of dozens of member firms that met with Home and Senate lawmakers in 2017 on Capitol Hill to advocate for chopping the company tax price.
“We’re centered on strengthening competitiveness by combating for a good enterprise tax system on the native, state, and federal ranges,” Wilkinson stated. “In 2017, this included becoming a member of the broad coalition of predominant road companies and innovation leaders that advocated for an easier and fairer tax system as a part of complete tax reform to assist financial progress and American jobs.”
Federal information present that the Silicon Valley Financial institution Management Group has not filed lobbying disclosure reviews since 2009.
Becker was chairman of the Silicon Valley Management Group from 2014 by means of 2017, in keeping with an archived model of his SVB bio web page. Becker couldn’t be reached for remark.
SVB and Becker again Democrats
Even because it pursued coverage objectives that generally clashed with Democrats’ priorities, SVB and Becker usually gave cash to the celebration’s candidates for workplace.
Certainly one of Becker’s large donations within the 2022 election cycle went to Senate Majority Chief Chuck Schumer, D-N.Y., in keeping with Federal Election Fee filings. Schumer is giving the contributions his marketing campaign acquired from each Becker and the financial institution’s PAC to charities.
Since 2011, the yr Becker turned CEO and president of SVB, its political motion committee has given nearly all of its donations in every election cycle to Democrats, in keeping with OpenSecrets. The exception got here in 2012, when Republicans maintained management of the Home at the same time as Obama received reelection.
Senate Banking Committee member Sen. Mark Warner, D-Va., additionally acquired contributions from Becker. Warner acquired $11,400 from the ex-bank CEO over the course of the 2020 and 2022 election cycles, in keeping with Federal Election Fee information. Sen. Jon Tester, D-Mont., acquired $3,000 from the financial institution’s PAC in 2017, in keeping with FEC information.
Becker additionally hosted Warner for a fundraiser in 2016 at his California residence, in keeping with an invitation to the gathering. Representatives for each Warner and Tester won’t say whether or not they plan to donate any of the funds they acquired from Becker or the financial institution’s PAC.
The veteran lawmakers voted for the 2018 regulation that rolled again items of Dodd Frank.
The invoice they backed reclassified the “too large to fail” normal underneath Dodd Frank, which got here with enhanced regulatory scrutiny. By elevating the regulatory threshold for banks from $50 billion in property to $250 billion, medium-size banks had been exempted from these laws. Becker, in testimony he submitted to a Senate panel in 2015, made an analogous name for his and different medium sized banks to be exempt from the Dodd Frank laws.
The Federal Deposit Insurance coverage Company, which helped type the protections for SVB depositors, stated earlier than the financial institution closed that the corporate had roughly $209 billion in complete property — which might have made it topic to these guidelines earlier than 2018.