Senator Grassley, the top Republican on the Senate Finance Committee, says he will offer an amendment to the financial regulatory overhaul in an attempt to crack down on employees who leave financial regulatory agencies and then go to work for the firms they regulate.A Grassley press release (received here by email, not yet, at this writing, posted to the senator's Web site) says the amendment would "establish a two-year ban on these former employees from representing clients before their former employer. The ban is similar to the revolving door ban the Senate places on its own members and would apply to employees that are paid a salary that is statutorily authorized above the standard government pay scale."
More from the press release:
"The revolving door is a real issue, and we've seen situations where someone is a high-level government official one day and representing a major player in the financial world before their former agency just days later, without any public disclosure whatsoever," Grassley said. "In addition to making things transparent, my amendment also would create a reasonable waiting period that's similar to those applied to members of Congress, congressional employees, cabinet level officers and other high ranking employees in the executive branch."
The agencies impacted by this amendment include the Securities and Exchange Commission, Federal Reserve, Federal Deposit Insurance Corporation, Farm Credit Administration, National Credit Union Administration, the Office of the Comptroller of Currency, Office of Federal Housing Enterprise Oversight, the Office of Thrift Supervision, and the Commodities Future Trading Commission. Congress has exempted certain employees at these agencies from the government pay scale, and the agencies are empowered to increase pay. Annual salaries exceed $200,000, in some instances.
It's not clear to me that such a ban would be consistent with the First Amendment rights of speech and petition, but I'm not aware that the issue has never been litigated. Nor is it clear that a two-year waiting period would really pose that much of an obstacle, as this example demonstrates.
