Just when you thought the US regulators may have finally become less tone deaf to the shame of the revolving door, especially following last year's latest scandal confirming Goldman runs the New York Fed [13](and every other central bank [14]), here comes the SEC with an absolute shocker, not only proving once and for all that when it comes to regulatory capture, there is nobody in charge quite like Lloyd Blankfein, but unveiling what may have been the first ever double revolving door in SEC history, after the SEC announced it had hired as its new chief of staff a former Goldman worker who had previously worked at... the SEC. And with that the we have gone not only full circle but full retard as well.
[15]
From the SEC [16]:
The Securities and Exchange Commission today announced that Andrew J. “Buddy” Donohue has been named the agency’s chief of staff. Mr. Donohue will replace Lona Nallengara who will leave the agency in June.
As chief of staff, Mr. Donohue will be a senior adviser to the Chair on all policy, management, and regulatory issues.
“I am thrilled that Buddy will be returning to the SEC to provide his extensive knowledge and expertise to the agency,” said SEC Chair Mary Jo White. “Buddy is a seasoned professional whose previous SEC and private sector experience will be invaluable in advancing all aspects of the agency’s mission. His deep knowledge of asset management will be especially useful as the Commission advances its rulemaking agenda for addressing potential risks in asset management and considers a uniform fiduciary standard.”
But she is mostly thrilled because her new employee will be able to provide a birds eye view of everything that happens at the SEC to his former employer, none other than Goldman Sachs:
Most recently, Mr. Donohue has been managing director, associate general counsel, and investment company general counsel at Goldman, Sachs & Co. in New York, where he was primarily responsible for legal matters related to its registered investment companies.
This is what he said back in October 2012 when he joined Goldman [17]:
Donohue said he decided to make the change because he believes he can make more of an impact in-house. "I like being part of the discussions with management about issues and approaches the firm can take early on," he told Reuters.
What happened Buddy, management didnt want to be part of the discussions with you? Or just said you would be most useful as a bugged "employee" of your former employer?
And where was he before Goldman?
Mr. Donohue returns to the SEC after serving as Director of the agency’s Division of Investment Management from May 2006 to November 2010. As director, he was instrumental in developing regulations governing the asset management industry and was responsible for policy and oversight affecting registered investment advisers as well as investment companies and the investment company industry.
But that's not all: you see "Buddy" is a recidivist revolver: before his first stint at the SEC, he was already a Wall Street veteran:
- From May 2003 to May 2006, Mr. Donohue served as global general counsel at Merrill Lynch Investment Managers in New Jersey. In that role, he oversaw the firm’s legal, regulatory and compliance matters for the investment advisory business.
- From June 1991 to November 2001, Mr. Donohue served as executive vice president, general counsel, director, and as a member of the executive committee of the investment fund subsidiary of Massachusetts Mutual Life Insurance Company, OppenheimerFunds Inc.
At this point what commentary can possibly do justice to a real-world narrative that makes the Onion, let alone any banana republic, seem boring by comparison? Clearly nothing can and will ever change until that revolution Paul Tudor Jones predicted [18]two months ago finally arrives.
