Watchdogs urge transparency as executives from powerful DC firm floated for Biden administration

MATTHEW MOSK and MIKE LEVINE
·6 min read

As speculation swirls over who President-elect Joe Biden will tap for top posts at U.S. intelligence and national security agencies, a number of the names being publicly floated come from a Washington-based firm packed with Obama-era powerbrokers.

The company, WestExec Advisors, describes itself as a “strategic advisory firm” that helps private businesses navigate potential challenges around the world, including international laws, “geopolitical trends” and “changes in Washington and in other capitals."

The low-profile firm’s client roster is closely-held – legally protected, the company says, by non-disclosure agreements. With little known about the firm's work since being founded two years ago, outside watchdog groups are already calling attention to what they see as a need for transparency from any WestExec partners who may be tapped to join the incoming Biden administration.

Unlike lobbying firms, which are usually required to disclose to the U.S. government the names of clients and government agencies they contact, WestExec falls into a different category of company, allowing it to operate with far less transparency.

"It’s a company that sells influence and connections,” with company executives using the expertise and contacts they acquired in government to boost their clients' private business interests, according to Mandy Smithberger from the non-partisan Project on Government Oversight, which investigates possible conflicts of interest and allegations of waste or fraud in federal government. “Particularly for those who are going to go through the confirmation process, it’s important to know who they were working for and the kind of work they were doing.”

Others said that they would like to see an ethics policy recently adopted by the Biden team – seeking to wall off members of the presidential transition from any personal financial interests – extend to the new administration as well.

A member of Biden's transition team told ABC News that "consistent with his commitment to build an administration that serves the people, not private interests, President-elect Biden will require his appointees to be governed by an administration ethics pledge."

Incoming administrations are often hounded by questions over possible conflicts of interest. Four years ago, as President Donald Trump took office, the Trump administration was routinely pressed over whether it was properly keeping Trump's personal business interests away from government operations. Democratic lawmakers still often raise those concerns.

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PHOTO: Deputy Secretary of State Anthony Blinken attends a press conference about the 2016 annual report on international religious freedom at the Department of State, Aug. 10, 2016, in Washington. (Brendan Smialowski/AFP via Getty Images, FILE)
PHOTO: Deputy Secretary of State Anthony Blinken attends a press conference about the 2016 annual report on international religious freedom at the Department of State, Aug. 10, 2016, in Washington. (Brendan Smialowski/AFP via Getty Images, FILE)

'Clear operating principles'

Founded in 2018 by two of Biden’s closest confidantes – Defense Department veteran Michèle Flournoy and Biden’s longtime national security aide Tony Blinken – WestExec draws its name from West Executive Drive, the narrow strip of road that cuts between the West Wing of the White House and the Old Executive Office Building, which houses some of the U.S. government’s top policymakers.

The firm represents one of the highest concentrations of Obama-era national security officials in Washington.

In public news accounts and private conversations with sources tied to the transition, Flournoy and Blinken – like a number of others who have been advising a confidential list of private clients – are often mentioned as possible picks for senior posts within a Biden administration. Flournoy in particular has been mentioned as a candidate for defense secretary.

At its inception, WestExec said it would be looking to recruit financial institutions and companies from around the world as clients, including industrial and defense firms, major technology companies, and pharmaceutical companies. In a statement to ABC News, the company said it was “legally and ethically” prevented from providing any specific information about its clients, but any appointees would be up front if they had conflicts.

A WestExec spokesperson told ABC News that if anyone from the firm is called to serve in a Biden administration, they would comply with any disclosure requirements and those current executives would “constrain their interaction with WestExec or any former client.”

PHOTO: Rain makes puddles on a road outside the White House, Nov. 11, 2020, in Washington, D.C. (Brendan Smialowski/AFP via Getty Images)
PHOTO: Rain makes puddles on a road outside the White House, Nov. 11, 2020, in Washington, D.C. (Brendan Smialowski/AFP via Getty Images)

The firm, the spokesperson added, has “clear operating principles that prohibit us from acting as an agent for any foreign principal, or from working for any governments or state-owned enterprises.”

In fact, according to an ABC News review of Justice Department databases, the firm has never registered as an agent for a foreign entity, suggesting its work related to overseas governments has been limited.

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Obama-era powerhouses: Blinken and Flournoy

WestExec’s formation was in many ways a staple of Washington, where generations of former federal officials capitalize on their government ties and insider knowledge by spending their time out of power working for think tanks, lobbying firms and consultancies.

Unlike those lobbying firms, though, WestExec does not contact lawmakers or elected directly on behalf of clients – even as it advertises its ability to “bring the full power of our network to bear in helping clients navigate rapidly emerging challenges and opportunities,” according to the firm’s website.

Blinken and Flournoy have formidable resumes. In 2016, the Defense News profiled Flournoy, a former under secretary of defense for policy, as someone destined to become “the first woman to run the Pentagon.” The report described how then-Vice President Biden referred to her as “madam secretary” with a wink while introducing her that year.

Blinken advised Biden on the Senate Foreign Relations Committee and served as his national security adviser for most of his tenure, leaving in 2013 to become deputy secretary of state.

PHOTO: Michele Flournoy, co-founder and managing partner of Westexec Advisors LLC, speaks during the Milken Institute Global Conference in Beverly Hills, Calif., April 29, 2019. (Bloomberg via Getty Images, FILE)
PHOTO: Michele Flournoy, co-founder and managing partner of Westexec Advisors LLC, speaks during the Milken Institute Global Conference in Beverly Hills, Calif., April 29, 2019. (Bloomberg via Getty Images, FILE)

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Other names in the mix

Other WestExec executives have similarly acquired extensive government experience after serving in key national security roles under Barack Obama's presidency. Principal Chris Inglis was the deputy director of the National Security Agency. Principal David Cohen served as the deputy director of the Obama administration’s CIA, after a stint in the Treasury Department. Firm managing partner Sergio Aguirre, and senior advisers Michael Camilleri and Dennis Ross, the former ambassador, all served in senior jobs on Obama’s National Security Council.

As the Biden transition team seeks to fill national security posts with experienced nominees, the president-elect has pledged to abide by an ethics policy that his campaign released in September. It says the people it appoints to oversee the transition “may not participate in any particular Transition matter that they know may directly conflict with a financial interest of the member, an immediate family member, partner, client or other individual or organization with which the member has or has had a business relationship within the past 12 months.”

Noah Bookbinder, the executive director of the non-partisan watchdog Citizens for Responsibility and Ethics in Washington, told ABC News his group wants to see that type of ethics policy, focused on the transition, extend to the time after an incoming Biden team takes office. He said Biden should take steps to ensure that members of the new administration are not beholden to past clients.

“The new administration must be deliberate in setting and meeting high ethical standards in order to restore public faith in our democracy and in the principle that those in government work for the benefit of the people, not for themselves,” Bookbinder said. “That will include taking meaningful steps to stamp out undue influence from special interests.”

One source familiar with WestExec’s past work, speaking to ABC News on the condition of anonymity, said company executives always believed they might be called to public service again in the future, so they have been careful and “professional” about how they conducted their private work.

Watchdogs urge transparency as executives from powerful DC firm floated for Biden administration originally appeared on abcnews.go.com