Before she entered politics, Rep. Katie Porter (D-CA) built a career unanimously examining the financial industry and advocating for consumers. So much so that the state of California once appointed her to oversee one of the largest banking industry consumer settlements in the state. history.
The brand became central to Porter’s successful campaign in Congress, where she eventually made a national name for the banking CEO who lied during the trial. She is now running for the US Senate in California. She promised to fight for a fair economy once again.
But embedded in Porter’s personal financial disclosures complicate that credibility. For years, her retirement accounts have been supplemented with investments in two companies that have been under scrutiny and scrutiny for alleged consumer abuse.
According to official documents, Porter owns between $1,000 and $15,000 worth of shares in Capital One. The credit card giant faces federal complaints over questionable marketing tactics. And was summoned in 2020 by Senator and Porter ally Elizabeth Warren (D-MA)—for her relatively meager and aggressive consumer debt pursuit and lawsuit.
Porter also owns between $15,000 and $50,000 worth of shares in Berkshire Hathaway, a mega-conglomerate run by billionaire Warren Buffett, as well as the nation’s top mobile home seller and lender. related mortgage Both groups face scrutiny over discriminatory lending practices.
Both assets are held in Porter’s personal retirement account, not part of a larger mutual fund with multiple stocks merged and managed by someone else. Since they’re in a retirement fund, Porter intends to hold them for decades to gradually appreciate, not cash in on the market play.
According to her office, Porter held those assets within the IRA for 15 years. Upon taking office in 2019, she promised not to buy or sell any stock while in Congress. So she hasn’t touched her investments in Capital One and Berkshire Hathaway in any way.
“Representative Porter believes members of Congress should not buy or sell stock and has publicly pledged not to,” said her spokesman, Jordan Wong. “She entered Congress with some long-held stocks in her retirement account. and kept his promise not to touch them. since joining Congress She only invests in diversified mutual funds and indexes. This is best practice recommended by ethics experts.”
But these companies were under scrutiny long before Porter came to Congress. And she has a long time frame to offload those stocks if she needs to. Given her extensive expertise—she once taught a university class on the credit card industry and researched debt collection activities—it is highly unlikely that she was not aware of the credit card industry. practice of the organization legislative branch and the media who are demanding and exposing
In 2012, for example, the first company to ever be targeted by the Consumer Financial Protection Bureau, the government watchdog that Warren envisioned after the 2008 financial crisis, was Capital One.
The CFPB alleges that major bank contractors pressurized cardholders to purchase expensive and inefficient additional services, which The New York Times Called “one of the financial industry’s growing profit centers and more controversial practices,” Capital One ultimately agreed to pay $210 million in consumer refunds and fines in response to the Implementation of the CFPB
Later in 2015, a ProPublica investigation reported that “no lender has sued more customers than Capital One,” and led the lawsuit by a large margin. The company took the credit card holder to court for only $1,800 in debt; Many customers were fined their wages. have to face burdens at home or filed for bankruptcy
At the height of the 2009 financial crisis, after Porter acquired Capital One, the company filed up to 10,000 lawsuits that year. Earn credit for helping Congress pass a bill cracking down on credit card fees.
In 2015, when Berkshire Hathaway’s Clayton Homes were the focus of bombing investigations by BuzzFeed News and Seattle TimesPorter has four more years to sell the stock. Their report found that Clayton Homes and home mortgage service providers It “systematically unwittingly pursues minority homebuyers and lures them into high-cost subprime loans,” resulting in many clients. “It ended up losing the house. Thousands of dollars down payment or even the land they own outright.”
Porter’s investment in Berkshire Hathaway has obviously been appreciated. It has since first appeared in her first financial disclosure in 2017, when it was listed as assets valued between $1,000 and $15,000.
However, Porter isn’t the only contender in California’s Senate race to face scrutiny for their investment holdings. In 2021, Rep. Adam Schiff (D-CA) sold $25,000 worth of shares in AbbVie, a pharmaceutical company that has faced allegations of price gouging over its arthritis drug Humira, Los Angeles Times Last year’s editorial debating the embargo cited Schiff’s sale of AbbVie as one supporting example, albeit on a smaller scale.
before the sale of Schiff Ironically, Porter gained another viral reputation after accusing AbbVie’s CEO at a supervisory board investigation. She uses her trademark whiteboard to distinguish claims that companies need to charge high prices to fund drug development.
As of 2021, Schiff holds up to $1.3 million worth of stock, mostly in managed funds, saving Apple stock ranging from $100,000 to $250,000. Schiff supports a ban on parliamentary stock trading. and a supporter of bipartisan legislation to achieve that goal.
In general, it’s not uncommon to see lawmakers invest in companies they directly criticize or focus on certain business practices.
in 2021 insider More than 30 members of Congress or their spouses reportedly own shares in Facebook. Representative Ro Khanna (D-CA), whose wife owns shares in the company. Calling for the company to go out of business, Rep. Marjorie Taylor Greene (R-GA), who condemns Facebook and its leadership. shared $50,000 of Facebook shares with her husband.
Kedric Payne, who tracks lawmakers’ stock activities at the Campaign Legal Center, said Porter’s bank holdings “didn’t stand out to me as hypocritical.”
Still, it’s hard to overstate the extent to which Porter’s political career is defined by her identity as hostility to large financial institutions and to the consumer alliances those institutions exploit.
At Harvard Law, Porter studied under Warren and then became an academic, teaching courses on bankruptcy law and the financial industry. In 2012, then-California Attorney General Kamala Harris appointed Porter to partially oversee of $25 billion multistate agreements It’s about a foreclosure settlement between state AGs and the nation’s largest mortgage lender.
When she ran for Congress in 2018 in her Republican district. The official Democratic campaign party first hailed Porter as “the most important person in the world”. He is a “consumer advocate” who “spent years fighting for the middle class and understood the importance of holding large corporations and banks accountable”.
Following her election, Porter joined the Financial Services Commission. on trial She gained national attention for accusing JP Morgan Chase chief executive Jamie Dimon of low wages for the company’s cashiers. and caught Wells’ chief Fargo clashed with his lawyers over the bank’s fraudulent account scandal. The story circulated praising Porter as The “newest threat to Wall Street,” the report describes, a flurry of attorneys preparing CEO clients specifically for Porter’s questions.
When Joe Biden became president, Porter was mentioned in news reports as a nominee to lead the Consumer Financial Protection Bureau.
As she runs for the Senate with Sen. Dianne Feinstein vacant next year, Porter’s bona fide consumerism and Warren-style economic populism are key to her distinctive appeal.
in fact The Silicon Valley Bank debacle in California in March elevated Porter’s expertise and political views on finance in the Senate race. Together with Warren, she called for the abolition of Trump-era banking regulations. which, she argues, fuels bad banking behaviour.
“I call on Congress to restore the common sense that governs corporate greed and restore trust in our financial system,” Porter said.
