GOP presses for own oversight role as House Democrats investigate
By: Zachary Warmbrodt, Politico
Washington,
February 5, 2019 -
House Democrats armed with subpoena power are vowing to follow the Trump money trail through the German lender Deutsche Bank — a target that Republicans say they want to investigate as well.
Instead of fighting Democrats over their probe, GOP lawmakers are pursuing their own inquiry. The top Republican on the House Financial Services Committee, Rep. Patrick McHenry (R-N.C.), has asked Deutsche Bank's CEO for details related to its role in international money laundering scandals.
Money laundering is also an element of the joint investigation led by Financial Services Chairwoman Maxine Waters (D-Calif.) and Intelligence Chairman Adam Schiff (D-Calif.). They're looking at the bank's role in money laundering as they examine its dealings with President Donald Trump and the extent to which Trump has been influenced by foreign powers including Russia.
In an interview, McHenry said illegal money laundering for Russians is a "major concern" that's bipartisan.
"With Deutsche Bank, there's legitimate investigative work this committee has to focus on to ensure they're complying with longstanding law in the United States," he said.
It's an early indicator of how Republicans may respond to investigations by Democrats.
In the case of Deutsche Bank, a key lender to the Trump Organization, Republicans are walking a tightrope to avoid antagonizing the president without the appearance of abdicating their own oversight role.
"If there is a legitimate legislative purpose for investigating a particular financial institution because it's going to inform Congress about how to update the Bank Secrecy Act or because we're uncovering some problem with an administrative agency within our jurisdiction, I'm all in, regardless of the party registration of the president or the leadership of the executive branch," Rep. Andy Barr (R-Ky.) said.
For Republicans, it will be politically easier to grill a foreign bank with a growing list of potential criminal issues than participating in other aspects of the coming investigations into Trump and his administration.
"Punishing bad actors is usually good politics and the right thing to do, so it's not a tough position to take," said Ian Katz, a director with Capital Alpha Partners.
McHenry's inquiry to Deutsche Bank focused exclusively on financial wrongdoing and omitted any mention of Trump, who is by far the major driving force for Democrats to investigate the company.
"This is of substance as policymakers," McHenry said. "It's not a political hit."
Republicans say the finance industry shouldn't necessarily count on them to come to its defense as Waters ratchets up oversight of big banks and credit reporting firms like Equifax, which suffered a massive cybersecurity breach in 2017.
It would be a big change for financial firms that largely benefited from an agenda focused on deregulation when the committee was in GOP control.
Republicans will likely take their queues from McHenry, who has been trying to build up goodwill with Waters as they both take on new leadership roles on the committee. Waters frequently clashed with previous Chairman Jeb Hensarling (R-Texas), and his use of the panel's investigative powers was a source of tension.
McHenry has sent signals that he is "interested in being a productive member" of Financial Services even as he leads the opposition in the minority, said Rep. Denny Heck (D-Wash.), a member of both committees investigating Deutsche Bank.
"That's one of those assumptions I'll continue to make until he proves otherwise," Heck said.
McHenry and Waters joined forces to pass a trio of financial crime bills last week. And she agreed to keep Republicans in the loop on upcoming investigations by sharing proposed subpoenas and alerting them when she requests documents from agencies.
Republicans including Barr tried unsuccessfully to push for a bigger say in investigations — specifically, how Waters uses her unilateral subpoena power. Barr said it would strengthen public confidence to know that oversight is "being done in a bipartisan way and with all members equally participating."
Some Democrats and watchdog groups are dubious about Republicans' intentions.
Better Markets President and CEO Dennis Kelleher, who has pushed for stronger oversight of the finance industry, said Waters should be applauded for "taking Republicans at their word."
Time will tell whether it's genuine, Kelleher said.
"Anybody who has seen how Republicans on the Financial Services Committee have behaved as supplicants or as an extension of the Washington-Wall Street lobby machine should be pretty skeptical," he said.
