Better Markets Fails to Disclose Troubling Conflict of Interest in Recent Amicus Brief Filing Via Investors Unite
Last week, an advocacy group called Better Markets published a blog post announcing the filing of anamicus brief in the Perry Capital lawsuit before the DC Circuit Court of Appeals. The post slams Government Sponsored Enterprise (GSE) investors for seeking to “roll back the government’s actions and force taxpayers to return money that is rightfully theirs in an attempt to restore the broken pre-crisis status quo.”
The brief itself is deeply flawed, stating that GSE investors are “challenging the terms of their rescue and seeking once again to unfairly burden the U.S. taxpayers,” in disputing the illegal and deeply-troubling Third Amendment Sweep. It states that a shareholder victory in the case would somehow inhibit the government’s ability to respond to crises in the future and increase the likelihood of future financial disasters.
But the most troubling aspect of the brief is its author. Though Better Markets bills itself as a non-profit, non-partisan advocacy group, it is an organization composed of career Washington insiders and Big Bank veterans. Most glaring is Chief of Staff Sarah Miller, who previously served as a senior advisor to Treasury officials including former Secretary Timothy Geithner and former Under Secretary for Domestic Finance Jeffrey Goldstein.
In her official capacity at Treasury, Ms. Miller herself would have been a key participant in the implementation and execution of the Third Amendment Sweep. Therefore, in her capacity at Better Markets, she is more than a mere “friend of the court.” Given her close professional ties to the Treasury and her personal involvement in the action at the heart of the suit, Ms. Miller is very plainly both party to the case and a friend of the defendants.
Of course, Better Markets did not disclose this conflict of interest. The brief merely represents another filing by the defendants and another example of the Treasury Department disregarding the rule of law in an attempt to protect their favorite slush fund.
We are confident that the appellate court would remain unmoved by the filing based on its content alone. Taxpayers are already explicitly on the hook for potential GSE losses precisely because of the Third Amendment Sweep, which, despite Better Markets’ inflammatory rhetoric about “challenging the terms of (the GSEs’) rescue,” is exactly what the suit challenges. But, given these troubling conflicts, the brief ought to be dismissed outright.