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Presented by American Bankers Association: Delivered daily by 8 a.m., Morning Money examines the latest news in finance politics and policy. | | | | |  | | By Sam Sutton | Presented by American Bankers Association | Editor’s note: Morning Money is a free version of POLITICO Pro Financial Services morning newsletter, which is delivered to our s each morning at 5:15 a.m. The POLITICO Pro platform combines the news you need with tools you can use to take action on the day’s biggest stories. Act on the news with POLITICO Pro. A small Napa Valley investment shop has enlisted a powerful political ally in its battle for corporate reforms at Mark Zuckerberg’s Meta. Harrington Investments, which bills itself as an asset manager for “socially concerned investors,” has joined with American Federation of Teachers President Randi Weingarten and the AFL-CIO in a shareholder push for an independent review of Meta’s audit and risk oversight committee. The proliferation of dangerous content on Facebook and Instagram, along with potential financial losses linked to litigation, could pose risks to the company’s investors, according to a copy of the shareholder proposal shared with MM. That includes teachers’ pension funds, Weingarten told MM on Thursday evening. “The bottom line is: The platform has hurt kids, has fueled lies, and it's put our democracy at risk, and Zuckerberg doesn't want to do anything about it,” Weingarten said. With Meta’s share price having fallen by more than half in the last year, “I would have thought … losing all that value would have forced Meta to do something different, but it hasn't.” The corporate accountability watchdog group SumOfUs has also signed on to the proposal. The AFT and AFL-CIO’s latest foray into shareholder activism comes amid a growing fight between Republicans, Wall Street institutions and progressive groups over the role investors should play in shaping social and environmentally minded corporate policies. As red state leaders pull their contracts with eco-friendly asset managers, House GOP leaders are preparing to ramp up oversight of Wall Street institutions that are pushing businesses to adopt climate and diversity plans. “They want to be in control of all the money; it’s like they don’t want anybody to play their game,” Weingarten said, adding that she expects her union will be diving into similar shareholder initiatives affecting firearms and climate. “We have to be careful about not doing it based upon our emotions,” she said. “When people start thinking that this is very political, they start taking a step back. This can't be about politics.” Separately, Harrington and SumOfUs sent a resolution calling for a similar review of risk management practices at Google’s parent, Alphabet, citing privacy concerns and its ongoing court battle with the Justice Department over antitrust allegations. “Performance reviews of each company’s risk management practices are long overdue as evident by the volume of scandals and controversies stemming from both companies and their products,” Brianna Harrington with Harrington Investments said in a statement. “The reckless mismanagement must come to an end.” In a statement, Meta said it values “the views of our investors and regularly engage with them to get their perspective, which includes seeking input during the annual shareholder proposal process. As we’ve done in the past, we look forward to having an open dialogue on the topics at hand, and we are engaging with all the proponents again this year.” Alphabet did not respond to a request for comment. IT’S FRIDAY — And Sam might buy a Brock Purdy jersey. Go Niners, and please send tips to ssutton@politico.com and zwarmbrodt@politico.com.
| | A message from American Bankers Association: Don’t let big grocery chains and mega-retailers pressure Congress into passing misguided credit card legislation that will put your airline miles and personal data at risk. They want to pad their profits, as consumers struggle with sky high prices. Tell your lawmaker to oppose S. 4674. | | | | | | S&P manufacturing data will be out at 9:45 a.m. … The Financial Stability Oversight Council will hold a public meeting at 10:45 a.m. … San Francisco Fed President Mary Daly speaks at a American Enterprise Institute for Public Policy Research event at noon SAFE BANKING — Our Natalie Fertig: "Senate Majority Leader Chuck Schumer (D-N.Y.) is making a final push for inclusion of the cannabis banking bill in the omnibus funding package. According to a senior Senate Democratic aide, Democrats shared revised text with Republicans on Thursday in a bid to get cannabis legislation over the finish line. The new bill text addresses concerns raised by key Republicans, including Senate Banking Committee Ranking Member Pat Toomey (Penn.) and Judiciary Committee Ranking Member Chuck Grassley (Iowa)." WHAT A TIME TO CATCH NFT FEVER — Former President Donald Trump launched his own line of NFTs on Thursday. For $99, buyers can purchase digital trading cards that will enter them into a sweepstakes for dinner, a round of golf or a zoom call with Trump, who announced his bid for the 2024 Republican presidential nod last month. Proceeds from the new digital tokens won’t be going to his campaign, however – the tokens were produced by NFT INT under paid license for Donald J. Trump's name, likeness and image. “Would make a great Christmas gift. Don’t Wait. They will be gone, I believe, very quickly!” Trump said on Truth Social. NFT trading volumes and sales fell off a cliff over the last year as crypto markets were battered by a series of trading scandals and crashes, according to data compiled by The Block. While major NFT projects have attracted scrutiny from market regulators, the company behind the Trump tokens – which depict the 45th president as a chiseled superhero, pilot and racecar driver — notes that the products “are intended as collectible items for individual enjoyment only, not for investment vehicles.” SHEPHERD — Our Ben White and Daniel Lippman: “The Biden administration is about to get a fresh face to drive implementation of the giant Inflation Reduction Act, which includes hundreds of billions in green tax incentives and major changes in tax policy and enforcement. Laurel Blatchford, founder and principal of progressive strategy firm Uplook Advisors, will join the Treasury Department with the formal title of Director of IRA Implementation.” A CALL FOR WORKPLACE HARASSMENT SETTLEMENT DISCLOSURES —Our Declan Harty: Former Fox News host Gretchen Carlson’s nonprofit Lift Our Voices along with 11 other sexual assault and domestic violence prevention groups are urging the SEC to consider requiring public companies to annually disclose the number of settlements issued relating to workplace harassment, including sexual harassment and abuse. The Wall Street regulator could “provide the public with a better understanding of workplace harassment and the financial burden this behavior places on corporations, its shareholders and consumers,” they wrote in a letter on Tuesday. The effort already has plenty of support on Capitol Hill. More than 60 lawmakers led by Rep. Lois Frankel (D-Fla.) similarly called on the agency to consider as much in a separate letter Thursday. DELISTED — Also from Declan: “American regulators had full access to the audits of U.S.-listed companies in China and Hong Kong during a recent series of inspections, a key step toward avoiding mass delistings from New York exchanges, the Public Company Accounting Oversight Board chair said Thursday.”
| | | | POLITICO AT CES 2023 : We are bringing a special edition of our Digital Future Daily newsletter to Las Vegas to cover CES 2023. The newsletter will take you inside the largest and most influential technology event on the planet, featuring every major and emerging industry in the technology ecosystem gathered in one place. The newsletter runs from Jan. 5-7 and will focus on the public policy related aspects of the event. Sign up today to receive exclusive coverage of CES 2023. | | | | | | | | FIRST IN MM: GOP PLOTS PROXY PLAY— From Declan: House Republicans led by Rep. Bryan Steil of Wisconsin want to rein in the firms that advise investors on corporate governance issues, introducing new legislation that builds on a set of 2020 rules from the SEC that were partially unwound earlier this year. Officially known as The Putting Investors First Act, the bill would take aim at so-called proxy advisory firms that Steil’s office says are “fueling a movement to weaponize your retirement funds to push a woke social agenda.” It also outlines new requirements for investors that use the firms’ recommendations. Proxy advisers have become a growing sticking point for executives across corporate America, as more institutional investors look for help on how to vote at companies’ annual meetings. Sometimes the recommendations are about issues as mundane as board nominees, but others relate to more contentious matters, such as carbon emission disclosures. And while unlikely to pass in the waning days of the current Congress, the legislation could become central to the GOP’s ongoing fight against ESG. ANYWAY, HAPPY HOLIDAYS — Reuters: “U.S. stock indexes closed sharply lower on Thursday, with each of the major averages suffering their biggest daily percentage drop in weeks, as fears intensified that the Federal Reserve's battle against inflation using aggressive interest rate hikes could lead to a recession.” RETAIL STUMBLES — WSJ’s Harriet Torry: “U.S. retail spending and manufacturing weakened in November, signs of a slowing economy as the Federal Reserve continues its battle against high inflation.” CITI HERE, CITI THERE, CITI EVERYWHERE — Bloomberg’s Jennifer Surane: “Citigroup Inc. told employees they can work from anywhere for the final two weeks of the year, as Chief Executive Officer Jane Fraser bucks a trend among rivals to get office workers back to their desks full time.”
| | | | A message from American Bankers Association:   | | | | | | FIRST IN MM: RUG PULLS — As Congress weighs new rules to protect crypto users from scams, a new report from blockchain analytics firm Solidus Labs found that scammers have launched more than 200,000 fraudulent crypto tokens since September 2020. Those schemes — known as “rug pulls” — generated more than $11 billion in proceeds via centralized crypto exchanges, which underscores “significant gaps in consumer protection, anti-money laundering, and crypto market integrity,” according to the report. ASK FIRST — From Sam: “New York’s top financial regulator released new guidance for banks on what steps they need to take before they go into business with the crypto industry. The guidance, which applies to New York banks and the branches and agencies of foreign institutions that are licensed by the state, requires banks to get New York Department of Financial Services approval before engaging in any activity linked to virtual currencies.”
| | | | A NEW POLITICO PODCAST: POLITICO Tech is an authoritative insider briefing on the politics and policy of technology. From crypto and the metaverse to cybersecurity and AI, we explore the who, what and how of policy shaping future industries. We’re kicking off with a series exploring darknet marketplaces, the virtual platforms that enable actors from all corners of the online world to traffic illicit goods. As malware and cybercrime attacks become increasingly frequent, regulators and law enforcement agencies work different angles to shut these platforms down, but new, often more unassailable marketplaces pop up. SUBSCRIBE AND START LISTENING TODAY. | | | | | THE CALL WAS FROM INSIDE THE BUILDING — Bloomberg’s Olga Kharif: “Ryan Salame, the former co-CEO at FTX Digital Markets, told island regulators on Nov. 9 that client assets were transferred to Alameda Research to ‘cover financial losses’ at the trading firm, court filings show.” — Bloomberg’s Steven Church and Emily Nicolle on the FTX creditor committee, which includes the troubled crypto lender Genesis. UNFINISHED BUSINESS — Treasury still hasn’t put out rules on how digital asset businesses should comply with new IRS reporting requirements that were established in last year's bipartisan infrastructure law. In a letter to Secretary Janet Yellen on Thursday, top Financial Services Republican Patrick McHenry (R-N.C.) urged Yellen to prioritize rulemaking and push back the effective date to give room for businesses to comply.
| | A message from American Bankers Association: Big grocery chains and mega-retailers are pressuring Congress to pass legislation that will harm consumers. These businesses enjoy record profits on record prices. Now they’re demanding all the benefits of our modern payments system without helping pay for it. Their so-called Credit Card Competition Act would in fact reduce choices for consumers, jeopardize the security of their sensitive data, and eliminate popular credit card reward programs like travel points that drive the nation’s tourism industry. Recent survey data show that 94% of consumers value the convenience of their credit cards and 90% value their credit card rewards. Ask your lawmaker to stand up for American consumers and oppose this misguided legislation. | | | | | | | Follow us on Twitter | | | | Follow us | | | | |  |
