How Private Equity Found Power and Profit in State Capitols


Private equity firms have used sophisticated but indirect political maneuvering with state and local entities to smooth the way for growth and revenue.

PHOENIX — Inside a cramped committee room on the cactus-dotted campus of Arizona’s Capitol, Kelsey Lundy stepped to the podium to detail new legislation and the higher costs it would impose on struggling borrowers.

 But Ms. Lundy is not a lawmaker, a government employee or even a statehouse intern.

She is a lobbyist for one of the nation’s largest lenders.

 That lender — controlled by the Fortress Investment Group, one of Wall Street’s most powerful private equity firms — wrote the bill. Months later, in 2014, the state’s legislators passed the law, making it easier to charge interest of 36 percent to borrowers living on the financial margins…
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