Draining the Swamp - Part Whatever

Jay Clayton, Donald Trump's choice to head the SEC, is slated to appear before the Senate Banking Committee Thursday. In that hearing, he may be asked about some pointed questions about his personal holdings.

Clayton is already an unusual choice, given that he's slated to be a primary regulator of Wall Street while a chunk of his family income will continue to come from Goldman Sachs, where his wife Gretchen works.

  Matt Taibbi

Actually, as Republican administrations go, that's a typical choice, not an unusual one.

Although he will have to recuse himself from enforcement cases involving Goldman, he will not have to sit out of a broad range of other regulatory decisions that affect the company.

[...]

In Clayton's absurdly baroque Form 278 financial disclosure – if you want to feel like your financial life is meager and uncomplicated, take a look at this staggeringly long list of income sources for the former Sullivan and Cromwell mainstay – he lists, under "other assets and income," a series of entries involving a company called WMB Holdings.

[...]

But WMB, and a company called CSC – with which it appears to have a connection – is a company of a very particular type, known well to white-collar investigators.

"It's a corporate formation company," says Jack Blum, an expert on white-collar crime and money laundering who is best known for his investigation of the BCCI scandal. "You call them up, and 20 minutes later you've got a Delaware corporation. I'm exaggerating, of course, but that's what they do."

[...]

The worst-case scenario is a string of shell companies that end in an opaque offshore haven. "That's when the trail becomes impossible to follow," says Blum. Investigators who try to follow money into offshore banking havens have almost no hope of getting answers there, he says.

[...]

"If you want to launder money, evade tax or hide assets from a spouse, you can do it."

Clayton's family seems to have a serious interest in this firm. He lists a series of family trusts containing WMB holdings, most producing high annual dividends.

[...]

The endnote claims Clayton has no beneficial interest or control in these holdings, but that his wife and/or children have a "beneficial interest."

And surely he can't benefit from his wife's or his children's benefits.

Even if WMB and CSC are completely above-board, it's a strange sort of investment for the top cop on the financial beat. It will be interesting to see if he sheds some light on his holdings when he's questioned this week.

...but hey, do what you want...you will anyway.

Even Drudge?