The merger ax has fallen again. When consumer finance giant Household International Inc. bought Beneficial Corp. last week, it immediately closed Beneficial's 19-employee lobbying operation and kept only two Beneficial lobbyists.
Household's J. Denis O'Toole remains at the helm of the combined company's lobbying shop as vice president of government relations. He will lead a 24-employee government relations team that includes four lobbyists here.
Valerie T. Morse, chief lobbyist for Beneficial and an employee of the company for 12 years, said she declined Household's offer to stay. Instead, she plans to open her own consulting firm specializing in financial services and tax issues, and Household will be her first client. "This is kind of deja vu," said Ms. Morse, noting that Beneficial closed its lobbying office for several years in the mid-'80s because of downsizing. "It is life-altering. It is bittersweet. Everybody in this office I hired."
Other casualties include Beneficial lobbyists Jeanne-Marie Murphy and Laricke D. Blanchard. Ms. Murphy will remain with the company for two months during a transition period, and Mr. Blanchard will take time off for the bar exam and then pursue a financial services-related job here.
Household will bring back to Washington Robert Thomson 3d, who most recently had been Beneficial's New Jersey lobbyist, Mr. O'Toole said.
The primary issues for Household's federal lobbyists, Mr. O'Toole said, will be "the same things we always concentrate on" - bankruptcy reform, financial modernization, and mortgage disclosure reform issues. "It's nothing new."
Breaking ranks with most of the banking industry, Golden West Financial Corp. chairman Herbert M. Sandler on Monday urged the Senate Banking Committee to block Federal Home Loan Bank System reform from being included in regulatory relief legislation.
Sen. Chuck Hagel, R-Neb., may offer his reform plan as an amendment this month when the committee votes on legislation that would streamline banking regulations.
In a letter to committee Chairman Alfonse M. D'Amato, Mr. Sandler complained that Sen. Hagel's proposal would let Home Loan banks further expand their nonhousing investment activities. He wrote that investments in money market and other nonhousing instruments create a "significant risk" for Golden West-one of the largest shareholders in the system-and taxpayers.
"The system lacks the expertise to manage or regulate such large-scale activity competently and prudently," especially if the economy turns sour, he wrote.
An aide to Sen. Hagel called Mr. Sandler's characterization of the reform measure "completely false" and "disingenuous," arguing that it contains sufficient investment limits. He accused Golden West of opposing the plan because it fears new competition if community banks gain broader access to Home Loan bank advances. Mr. Sandler denied in his letter that Golden West objects to increased advances for small banks.
Brian D. Cooney, the No. 2 lobbyist at the American Institute of Certified Public Accountants, joined the Manufactured Housing Institute as vice president of government relations Monday.
"It's a new challenge," said Mr. Cooney, who worked for the accountants' trade association for eight years. "I welcome the opportunity to run my own government relations shop."
Housing issues are not as far a stretch from his current job as they seem, he said. Mr. Cooney noted that the House and Senate Banking committees also handle housing issues and he worked for the Mortgage Bankers Association in the late 1980s.
His former boss, J. Thomas Higginbotham, said he is just starting the search for a successor.