The visits to the OMB overlap with the period Mulvaney was acting director of the Consumer Financial Protection Bureau, which has oversight of the payday lending industry. While Mulvaney has served as Office of Management and Budget director, the White House has proposed cutting the bureau’s budget and curbing its enforcement powers.
Meanwhile, Simpson has been lobbying Congress and the Office of Administration on behalf of Tennessee-based Advance Financial, which was founded by Mike Hodges, a major fundraiser and contributor to President Trump’s campaign. Hodges recently told industry colleagues in a webinar first obtained by The Washington Post of the importance of having close ties to the Trump administration.
“I’ve gone to Ronna McDaniel and said, ‘Ronna, I need help on something,’ ” Hodges said, referring to the chair of the Republican National Committee. “She’s been able to call over to the White House and say: ‘Hey, we have one of our large givers. They need an audience. … They need to be heard and you need to listen to them.’ So that’s why it’s important.”
According to a White House official, Simpson has never lobbied his former boss. “Al Simpson is one of Mick Mulvaney’s oldest and closest friends. When Simpson has visited Mick at the White House it has been solely for social purposes. Not once has Simpson lobbied Mick in any of his official roles, whether at OMB, CFPB, or as White House chief of staff,” the official said.
Simpson did not return repeated phone calls seeking comment.
Consumer advocates say their relationship illustrates the industry’s influence on the administration and the lengths to which it has gone to undermine tough regulations.
“This lobbyist is about the purest walking-and-talking evidence you could imagine of why money matters in Washington,” Linda Jun, senior policy counsel for Americans for Financial Reform, said about Simpson.
Added Derek Martin, director of Allied Progress, “The payday industry knows there’s no popular support for their predatory business model, so Advance Financial hired a lobbyist with one degree of separation from the president to make their case.”
The industry has other deep Washington connections: Two lobbyists for Community Financial Services Association of America, Dennis Shaul and Doyle Bartlett, identified themselves on disclosure forms as former chiefs of staff to former congressmen Barney Frank (D-Mass.) and Bill McCollum (R-Fla.), respectively.
Frank disputed that Shaul worked on his staff and said Shaul was a staffer for the House Financial Services Committee who did not work on issues related to payday lending.
Hayden Rogers was the former chief of staff for Sen. Joe Manchin III (D-W.Va.) until 2015 and is now a lobbyist for the Online Lenders Association. Amscot Financial, a large Florida payday lender, has hired former congressman Jim Davis (D-Fla.) and Davis’s former chief of staff, Karl Koch, among its lobbyists.
Simpson and Mulvaney’s relationship dates to when Simpson was chairman of the Lancaster County GOP in South Carolina and recruited Mulvaney to run for office in 2006. “He turned me down four times, and I kept going back to him,” Simpson told RealClearPolitics in 2017.
Simpson served as chief of staff to Mulvaney from 2011 until the South Carolina Republican left Congress in 2017 to join the Trump administration. He then joined Mercury Public Affairs, a D.C. lobbying firm, where he has also worked for the Myrtle Beach Area U.S. Chamber of Commerce, military contractor Lockheed Martin and the Cannabis Trade Federation, according to public records.
Since Simpson became a lobbyist for Mercury Public Affairs, he has had dinner with Mulvaney at least three times, including dining at a seafood restaurant in the Navy Yard and at Trattoria Alberto of Capitol Hill, according to Mulvaney’s public calendar.
He has also visited the Office of Management and Budget 11 times. Simpson appeared on Mulvaney’s calendars more frequently than anyone who is not a current government official over a seven-month period in 2017, according to ProPublica. He sometimes brought clients, including representatives for BlueCross BlueShield of South Carolina, to those meetings.
The relationship between Simpson and Mulvaney raises several questions, said Kathleen Clark, a professor at Washington University in St. Louis. “To what extent is the White House and the chief of staff actively involved in the payday lender issues? What role has the White House taken?”
Simpson became a lobbyist for Advance Financial at a time when the payday lending industry was fighting Obama-era regulations that would have required lenders to ensure their customers can afford to pay back their loans.
Consumer advocates say the regulations are necessary to stop consumers from being trapped in loans with high interest rates. But the industry has fought back, saying the CFPB rule is unnecessary and too complex.
In January 2018, less than two months after becoming CFPB acting director, Mulvaney said the bureau would reconsider the payday lending rules the industry had rallied against. He also dropped several lawsuits against payday lenders.
In February, the CFPB under Mulvaney’s successor, Kathy Kraninger, proposed significantly weakening the rule.
During the fight over the rules, the founder of Advance Financial, Hodges, emerged as one of Trump’s top fundraisers. In the September webinar, Hodges said he had given $1 million to Trump’s campaign and was now raising money for the president.
During the webinar, Hodges said it would give him a “boost” if he could show that he had brought in donors who had never given before, even if their contributions were small. “That is important to the campaign, which means it’s important to the president, which means it’s important if you ever had to call on anyone for anything in the administration,” he said during the call. “That’s how those things work.”
In an email, Hodges said he hired Simpson because he “is an experienced lobbyist with many years of small dollar industry knowledge and I like him.” Simpson had not advised him on any fundraising strategies, said Hodges, who has described himself as an “enthusiastic” Trump supporter.
Simpson has earned $350,000 as a lobbyist for Advance Financial, according to government lobbying reports.
In addition to hiring Simpson, Advance Financial also filed a petition with the CFPB critical of an aspect of its payday lending rule. The original rule would have limited how often a payday lender could attempt to take money from a customer’s account, addressing advocates’ complaints that they were running up significant overdraft penalties.
“Generally speaking, the Cordray rule is a de facto prohibition of the industry through regulation,” Hodges said, referring to former CFPB director Richard Cordray, who was appointed by President Barack Obama.
In a petition to the CFPB in December, Advance Financial argued that the rule shouldn’t apply to debit card transactions, which “do not pose any risk of likely substantial injury to consumers.” “The decision to include debit cards was arbitrary and capricious, contrary to law, and in excess of the Bureau’s authority,” the petition said.
Kraninger, the director, told the Senate last month she was weighing Advance Financial’s petition. “We will have to look at and at least respond to these concerns,” she said.
Pressure on the industry has been building recently. California’s legislature passed a law last month limiting interest rates on some consumer loans to 36 percent. Earlier this month, a group of lawmakers, including one Republican, introduced legislation to put in a similar interest rate limit nationally.
The bill would limit consumers’ financial options, “forcing working people to bounce checks, miss payments, or go without essentials,” Mary Jackson, chief executive of the Online Lenders Alliance, said in a statement.
Hodges’ wife, Tina Hodges, is on the group’s board.
Clarification: A previous version of this article said that Dennis Shaul was former congressman Barney Frank’s chief of staff. It has been clarified to note that Shaul listed himself as such on a lobbying disclosure form. Frank claims that Shaul was not his chief of staff and worked on the House Financial Services Committee. The story has been updated.