DC AG closes investigation into Arabella Advisors

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By Caitlin Oprysko and Heidi Przybyla

Presented by 

DoorDash

With Daniel Lippman 

FIRST IN PI — D.C. AG CLOSES ARABELLA PROBE: D.C. Attorney General Brian Schwalb has cleared Arabella Advisors, the consulting firm that oversees a wide swath of liberal nonprofit groups, of engaging in any inappropriate business conduct, according to an attorney representing several of those nonprofits.

— "The D.C. Office of the Attorney General closed its investigation into the Funds and Arabella after finding no evidence of a violation of law,” the lawyer, Joshua A. Levy, said in a statement. “We fully cooperated with this investigation and have long known that the Funds and Arabella comply with the law.”

— A spokesperson for Schwalb’s office, Gabe Shoglow-Rubenstein, declined to comment on the probe, citing the office’s policy against confirming or denying the existence of potential investigations.

— Arabella Advisors complied with subpoenas issued by Schwalb’s office, which is also investigating the nonprofit network aligned with conservative judicial activist Leonard Leo.

— The probes stemmed from dueling IRS complaints from liberal and conservative watchdogs in response to POLITICO’s reporting about the lavish lifestyle Leo and several of his allies embarked upon around the same time Leo was tapped as an unpaid adviser on judicial nominations to former President Donald Trump.

Campaign for Accountability, a liberal dark money group previously affiliated with a nonprofit managed by Arabella, accused Leo of violating nonprofit tax laws against personal enrichment by steering millions of dollars from his network of affiliated nonprofits to his for-profit consulting firm CRC Advisors.

— In turn, conservative watchdog Americans for Public Trust targeted Arabella Advisors. Americans for Public Trust receives much of its funding through DonorsTrust, which is often described as the “dark money ATM” of the conservative movement that has given millions to Leo-aligned nonprofits and CRC Advisors.

— Leo’s attorney has said he’s refusing to comply with Schwalb’s investigation, and did not immediately respond to questions about the status of Schwalb’s probes.

— There are significant differences between Leo’s network and Arabella Advisors, the company his allies often cite in claiming that Leo and his consultancy are being unfairly treated. Arabella is a for-profit company that provides administrative, HR and accounting services to largely philanthropic nonprofits that are largely independently run. In Leo’s network, a few individuals have managed nonprofits taking in tens of millions of dollars that have also flowed to his for-profit company.

— As Schwalb’s investigations played out behind closed doors, the AG’s office has come under a deluge of criticism from Leo’s defenders — and beneficiaries of his dark-money network — ranging from investigations announced by GOP committee chairs in the House, to critical pieces in conservative media, to objections lodged by Schwalb’s Republican counterparts in other states.

TGIF and welcome to PI. Send tips: coprysko@politico.com. And be sure to follow me on the platform formerly known as Twitter: @caitlinoprysko.

 

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IN NON-EARTHQUAKE NEW JERSEY NEWS: Our Alfred Ng reports that “a pioneering law in New Jersey that protects the privacy of law enforcement officials could soon come under fire from a coalition of businesses that want to loosen up the new rules, according to an audio recording provided to POLITICO.”

— The Association of National Advertisers convened a conference call on Feb. 22 with fellow industry group the Consumer Data Industry Association, the lobbying firm Venable (which PI reported yesterday is lobbying for data giant RELX) and the data broker Acxiom “to discuss how the industry should respond to Daniel’s Law, a New Jersey data privacy regulation that three other states are also considering.”

— “The participants in the call … outlined plans to weaken the law, pushing amendments that would protect them from lawsuits and let them resume sharing police officers’ and judges’ personal information with customers even when those law enforcement officials are afraid for their safety.”

— Data brokers are also facing a new clampdown in Washington, our Katy O’Donnell reports: “The Consumer Financial Protection Bureau will propose a rule restricting data brokers’ activities under the Fair Credit Reporting Act ‘in upcoming months,’ CFPB Director Rohit Chopra said Thursday.”

BP PULLING ADS FROM CRUZ PODCAST: Houston-based oil giant BP is pulling its ad buys on the iHeartRadio podcast hosted by Sen. Ted Cruz (R-Texas) amid legal questions raised by the revelation that a pro-Cruz super PAC had been receiving ad revenues from the show, according to The Dallas Morning NewsJoseph Morton.

— “We purchase advertising on iHeart based on the potential audience and do not specify by podcasts,” BP America spokesperson Ross Parman told the paper. “We were never informed that media spend was going directly to a super PAC and have instructed iHeart to remove our messages from any podcasts that direct advertising revenue to campaigns, PACs or political parties.”

— “Rachel Nelson, spokesperson for iHeart subsidiary Premiere Networks, said in a statement that Cruz volunteers his time to host the podcast and isn’t compensated for it. Nelson said Premiere sells advertising time for ‘Verdict,’ as it does for other podcasts, and the money being directed to the Truth and Courage PAC is ‘associated with those advertising sales.’”

 

Access New York bill updates and Congressional activity in areas that matter to you, and use our exclusive insights to see what’s on the Albany agenda. Learn more.

 
 

REALTORS NOT OUT OF THE WOODS: “A federal appeals court in Washington, D.C., sided with the Justice Department, allowing the agency to reopen an antitrust investigation of the National Association of Realtors that the trade group says is not allowed to go forward due to the terms reached in an earlier settlement,” our Josh Sisco and Katy write.

— “In a 21-page opinion on Friday, Judge Florence Pan, writing for the majority of a three-judge panel on the D.C. Circuit Court of Appeals, said a prior closing letter from the government in the previous administration does not mean the probe could never be reopened.”

— “The ruling adds to the legal woes of the nation’s largest trade group, clearing the path for a wide-ranging DOJ investigation” after the trade group last month “agreed to settle a barrage of lawsuits by paying $418 million in damages and eliminating a rule underpinning the lucrative commission system at the heart of the housing market.”

HOPE YOU FLOSSED: Dentists and dental students will be on the Hill next week as part of the American Dental Association’s annual fly-in. The group expects this to be its largest fly-in to date, with more than 1,100 attendees from all 50 states, Puerto Rico and D.C.

— Participants are slated to meet with more than 350 members of Congress including fellow dentists Reps. Mike Simpson (R-Idaho), Brian Babin (R-Texas), Drew Ferguson (R-Ga.) and Jeff Van Drew (R-N.J.) to discuss reforming student loans, strengthening the dental workforce, and fixing non-covered service provisions in dental and vision plans.

DOJ SITTING ON ALLEGED LOBBYING VIOLATIONS: The Government Accountability Office’s required annual audit on compliance with the Lobbying Disclosure Act landed this week, and it revealed that thousands of possible lobbying violations have sat unresolved — for years in some cases — after being referred to the U.S. Attorney’s Office for the District of Columbia.

— “When a lobbyist or firm fails to comply with the reporting requirements, the secretary of the Senate and the clerk of the House notify them and make referrals to the U.S. Attorney’s Office (USAO) only when they fail to provide a proper response,” The Hill’s Taylor Giorno writes.

— “About 74 percent of the 3,622 referrals the USAO has received for alleged quarterly lobbying reporting violations since 2014 were still pending as of January,” while “around two-thirds of alleged political contribution reporting violations are still open: about 67 percent of the 2,128 lobbying firms and 65 percent of the 7,962 individual lobbyists referred to the USAO since 2014,” according to the report.

 

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Jobs Report

— The Consumer Brands Association has added Kathie Vu as vice president of member engagement and experience, Natalie Rubino as director of media relations and Stephanie Neves as specialist of member engagement and events. Vu was most recently with the National Restaurant Association, Rubino was previously at imre and Neves was previously at the American Gaming Association.

Paolo Messa has joined the National Italian American Foundation as executive vice president of international relations and strategic partnerships. He most recently served as the board chair of the Leonardo U.S. Corporation and is a nonresident senior fellow at the Europe Center of the Atlantic Council.

Andrés García has been promoted to partner in Dentons Global Advisors’ Latin American and Caribbean practice.

Avra Siegel and Liza Heyman are launching Lev Collective, a public affairs firm. The two are both alums of the Obama White House and Meta, where Siegel was director of U.S. public policy programs and Heyman was policy programs manager.

Austin Laufersweiler is joining Lot Sixteen as senior director. He most recently was senior comms manager for the Partnership for Public Service and is an Andy Levin, Michigan Democratic Party and Let America Vote alum.

Society of Chemical Manufacturers and Affiliates President and CEO Jennifer Abril has been named chair of the National Association of Manufacturers’ Council of Manufacturing Associations.

David Milestone is joining the Tony Blair Institute for Global Change as managing director of the Americas. He most recently was senior adviser at McKinsey & Company and is a USAID alum.

Millie Tran is joining the Council on Foreign Relations as vice president and chief digital content officer. She previously was vice president of content strategy and growth at Condé Nast.

Misty Fuller is joining Powell Tate as senior vice president of health policy and advocacy. She previously was director of public affairs at PhRMA.

Anthony Wright is joining Families USA as its executive director, per Morning Pulse. He previously was executive director of Health Access California.

New Joint Fundraisers

2024 Green Senate (Sen. Jacky Rosen, Reps. Colin Allred, Ruben Gallego, DSCC, Debbie for Florida)

Schiff Goldman Victory Fund (Reps. Adam Schiff, Dan Goldman)

Slotkin Hertel Victory Fund (Rep. Elissa Slotkin, Hertel for Michigan)

Team Rob (Rob for PA, NEPA Next PAC, Republican Federal Committee Of Pennsylvania, NRCC)

New PACs

AMERICAN BASKET OF ADORABLE WORKERS (Super PAC)

Republican Assembly INdiana Southwest (RAINS) (Super PAC)

LAST FRONTIER PAC (Super PAC)

New Lobbying REGISTRATIONS

Arentfox Schiff LLP: Little Lights Urban Ministries

Az Dc Consulting, LLC: Maripos Community Health Center

Az Dc Consulting, LLC: The Be Kind People Project

Brian Glackin & Associates LLC: Jones Walker LLP (On Behalf Of Seatrec Incorporated)

Brownstein Hyatt Farber Schreck, LLP: Sionyx

Capstone National Partners: Fork Farms

Capstone National Partners: Milwaukee County

Homeserve USa Corp: Homeserve USa Corp

Human Coalition Action: Human Coalition Action

Invariant LLC: Atomic Machines

Mcdermott Will & Emery LLP: Bassett Healthcare Network

Ogr: Cruise LLC

Red Maple Consulting, LLC: Mariners' Museum

Stanton Communications, Inc.: Comite Champagne

Wilmer Cutler Pickering Hale And Dorr LLP: Infoblox

 

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New Lobbying Terminations

Arnold & Porter Kaye Scholer LLP: Cerberus Capital Management, Lp On Behalf Of Worldwide Flight Services

Capstone National Partners: Modern Hydrogen

Crossroads Strategies, LLC: Morrison Cohen LLP Obo Rexmark Holdings, LLC

Hbw Resources: K&L Gates

Homeserve USa Corp: Homeserve USa Corp

Invariant LLC: Household & Commercial Products Association

Live Oak Strategies: Black Widow Helicopters, LLC

Live Oak Strategies: Force Forward, Inc.

Orrick, Herrington & Sutcliffe LLP: Schoeller Invest Gmbh

Patel Partners: Sight Sciences

R&R Partners, Inc.: Tae Technologies

Stonington Global: Ignite Medical Resorts

Tiber Creek Group: Blue Cross Blue Shield Association

Wexford Strategies: Consumer Energy Alliance

 

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