February 21, 2020
The American Prospect, February 21, 2020
The insidious influence of the wealthy over our politics, as Alexander Sammon wrote last month, is perhaps the defining issue of the 2020 Democratic primary. It’s the reason we at the Revolving Door Project have been yammering on about bundlers—the wealthy and well-connected volunteer fundraisers who almost inevitably end up receiving or influencing key jobs across the executive branch. Bundlers have driven the facile premise of both Tom Steyer and Mike Bloomberg’s campaigns: “I can’t be bought by the rich, because I am one of the rich who buys.” This was initially Donald Trump’s pitch, too. And the desire to reject the influence of bundlers raise hopes in Bernie Sanders and Elizabeth Warren’s campaigns, largely driven by small dollars and people power.
But if the Democrats do nominate a candidate of the old guard, the traditional school of money-for-access politics, chances are high that one name will be at the top of their list of advisers: Brad Karp. After all, Karp’s name shows up on almost every bundler list the 2020 race has seen so far. If money is seductive in politics, then Karp is a master of seduction. And he’s in it for a reason: to make sure the next president doesn’t appoint regulators and prosecutors who will bring his corporate clients to heel.
Karp is the chairman of Paul, Weiss, an archetypal BigLaw firm representing large businesses around the world. In his Paul, Weiss bio, Karp brags that the press calls him “someone who every CEO in America should have on speed dial” and “the most connected lawyer in the country.” Karp is who corporate America calls when they might, just might, face (gasp!) consequences for their actions.
Karp wowed the BigLaw world in 2006 by steering Citigroup through over $150 billion in lawsuits over misleading statements to investors arising from the Enron scandal. In declaring Paul, Weiss the Litigation Department of the Year, American Lawyer raved that “Thanks to Karp and his Paul, Weiss team, Citigroup has closed a painful chapter of its history without devastating damage to its balance sheet or reputation.” Of course, Citigroup avoiding pain is not the same thing as justice being served, but what does that have to do with the legal system?
Citigroup would face renewed balance sheet and reputational damage two years later during the financial crisis, but the greatest economic catastrophe of our lifetimes was a golden business opportunity for Paul, Weiss. Karp was made chairman that May, meaning he guided the firm through its successful efforts to get Citi off the hook for its mortgage-backed securities-related malpractice. Karp later led the team which shielded the private equity firm Blackstone from accountability for lying about returns to Kentucky’s state pension fund.
The financial industry just can’t get enough of Karp. His self-reported recent clients include every systemically important (“Too Big To Fail”) bank except State Street, along with private equity pirates like KKR and Blackstone and hedge funds like Eton Park. That’s before you get into real-economy alarm-raisers like Facebook, Johnson & Johnson (last seen being found guilty for its role in the opioid crisis) and Deloitte.
Indeed, no one with money is too low for Karp. In late 2018, he registered to lobby on behalf of disgraced Nissan CEO Carlos Ghosn—the day after Ghosn was arrested by Japanese authorities on fraud charges. Karp stayed on his payroll after Ghosn was released on bail and re-arrested over new charges in April, and then again after French authorities began a whole separate investigation. Paul, Weiss fell silent once their client became an international fugitive, but the most recent disclosure forms there are indications that he was still a registered lobbyist for Ghosn through New Year’s Eve 2019, and I haven’t found any information to suggest he’s de-registered since. Thus, Karp lobbied for the most recognizable corporate criminal defendant of 2019 at the same time that he was fundraising for a host of 2020 Democratic contenders.
Amy Klobuchar and Joe Biden’s bundler forms, each released in December, both list Karp as a bundler. Klobuchar and Biden have both pledged not to take lobbyist money. If pressed, they’d doubtlessly try to worm their way out through the sorts of narrow legalisms that keep Karp employed—for example, Klobuchar pledged specifically to take no “DC lobbyist” money, but Karp resides in New York. Pete Buttigieg doesn’t list Karp as a bundler (though given his history of bundler opacity and the copious Paul, Weiss cash in his coffers, we would not be surprised if his campaign had just happened to “overlook” Karp.) Both Cory Booker and Kamala Harris had Karp on their own bundler sheets before they each dropped out.
If there is a corporate-friendly candidate in the 2020 race who needs cash, Karp is all too happy to help provide.
Why should voters care? Because it’s a crisis if Karp helps pick the next head of the Department of Justice’s criminal division. Or the next appointees to the Securities and Exchange Commission, Federal Trade Commission, Office of the Comptroller of the Currency, or any of the host of other regulators which oversee Paul, Weiss clients. We live in a golden age of white-collar crime, as HuffPost’s Highline division brilliantly reported recently. For a succinct case in point, just look at Trump’s pardon of Michael Milken.
To restore faith in any public institution, we need to prevent people like Karp from using their ill-gotten influence to keep the guilty and powerful out of jail. If the former “Litigator of the Year” cannot prioritize justice, he has no place influencing the legal appointees of the next president.