Questions arise over unregistered lobbyists convening with legislators
Reports and rumors have been swirling over groups that are operating outside of federal and local lobbying regulations in Puerto Rico, and they are doing so by abusing legal loopholes. Lobbyists are individuals who are paid by groups to represent and defend their pet issues to legislators. The practice is a form of free speech protected by the Constitution. However, since 1995’s Lobbying Disclosure Act was enacted, individuals paid to lobby at a federal level must be registered and must file reports on their activities. This crucial legislation helps to ensure and maintain transparency in federal lawmaking.
In a recent expose in Bloomberg Businessweek, the DCI Group, a lobbying company with ties to major hedge funds, including those with linked to Puerto Rico’s debt shareholders, has been accused of operating through loopholes to manipulate policy decisions without disclosing their activities. One such method has been to persuade influential academics to voice opinions on matters pertinent to the company’s interests. They can easily influence policy decisions without registering or reporting their actions by manipulating so-called expert opinions. The opinions of such knowledgeable and respected people are then used as the basis for the decisions of lawmakers over policy.
The DCI Group’s “unofficial” lobbying is potentially detrimental to Puerto Rico. Their connection to Puerto Rico debt shareholders has led them to interfere with policymaking on both a federal and a local level concerning PROMESA and Puerto Rico’s debt in general. Puerto Rico has its own laws concerning the lobbying of the islands’ legislature. According to local laws, lobbyists must register that they intend to lobby. However, both the DCI Group and Quinn Emanuel Urquhart & Sullivan, an international law firm, have been reported to be lobbying Puerto Rican legislators on behalf of COFINA, the Puerto Rico Sales Tax Financing Corporation. In response to reports of unregistered lobbying actions by individuals affiliated with the firm, Quinn Emanuel Urquhart & Sullivan made a statement via press release about it’s lobbying practices, detailing that they do not have “a specific lobbying practice” and that they interact “with government officials and their staff only when broader legal representation occurs.” The press release further stated, “The firm has represented COFINA’s bondholders as their legal advisors for more than three years, including all aspects of the debt restructuring processes under PROMESA,” the firm added.
The reports of both the unofficial and unregistered lobbying both within Puerto Rico’s legislature and the larger reports of manipulation on a Federal level, paint a slimy picture of the lobbying practice, with large corporations and debtors finding ways to profit from debt collection while covertly presenting their interests to lawmakers as expert opinion or grassroots support. It calls into question the effectiveness of current lobbying laws at federal and local level. Is enough being done to protect transparency in legislation?