“On Tuesday, the bank consulting firm Promontory Financial Group announced that it had hired Mary Schapiro, who stepped down as the head of the head of SEC four months ago.
“Schapiro is a particularly high-profile hire for the firm, but she’s among many there who are former Washington officials. In fact, Promontory already had a former SEC chair on its roster — Arthur Levitt is on the firm’s advisory board.
“Also associated with the firm are Laura Unger from the SEC; Alan Blinder, who was a vice chairman at the Federal Reserve; Frank Zarb, who headed the Nasdaq Stock Exchange in the 1990s; and Paul Tagliabue, the former commissioner of the NFL. In all, the firm has about 400 employees, about a quarter of which are former regulators.”
“On the firm’s website, it says it helps firms “grapple with and resolve critical issues,” particularly ones that involve regulators. Among its expertise, the firm says it helps banks comply with anti-money laundering and consumer compliance rules. It also advises banks on the Fed’s annual stress tests.
““Promontory does a lot of things, not all of which they talk about,” says Dennis Kelleher, who runs Better Markets, a group that has been critical of Wall Street and its dealings in Washington. “What the firm actually does is use insider knowledge gained by former regulators and their contacts to help keep or get banks out of trouble, and avoid punishment and accountability for their conduct.””
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