WASHINGTON-Rep. Eric I. Cantor’s personal ties to the mortgage industry helped him play a leading role in this month’s congressional debate over the $700 billion bailout of Wall Street.
Cantor, who handled real estate law at his family’s Richmond law firm before running for Congress, still has a $250,000 to $500,000 stake in TrustMor Mortgage, a mortgage brokerage he opened in 1996. The company has eight offices around the Richmond area.
Cantor earns between $15,000 and $50,000 a year from TrustMor, according to the most recent financial statement he filed with the U.S. House of Representatives. He is not involved in the company’s daily operations, said Rob Collins, Cantor’s chief of staff.
“People come to Congress with a variety of career backgrounds. This just happened to be one I had some academic training in,” said Cantor, who holds a master’s degree in real estate finance from Columbia University in New York.
Steve Baugher, executive director of the Virginia Association of Mortgage Brokers, which did not officially take a position on the bailout bill, said, “(Cantor is) sharp and he’s certainly got a good handle on most business issues.”
Bob Holsworth, a political scientist at Virginia Commonwealth University, agreed: “It enabled him to be a player intellectually in an arena where a lot of people couldn’t even get their sea legs.”
Cantor, the deputy House Republican whip, succeeded in adding a provision to the bill allowing Wall Street firms to buy government insurance for their less risky assets, rather than sell the assets outright to the government, as Treasury Secretary Henry M. Paulson Jr. had recommended.
“It was important we lessen the burden on the taxpayers,” Cantor said.
The bailout negotiations showed Cantor juggling his roles as rising Republican House leader, national fundraiser and local business advocate, Holsworth said.
Officials at TrustMor, including Cantor’s brothers, Stuart and Paul, did not return calls seeking comment for this story. The business would not directly benefit from the bailout, Eric Cantor said, since the taxpayer bailout is aimed at the toxic mortgage-backed assets held by much larger Wall Street firms.
Cantor’s insurance provision angered those New York firms which have been among his biggest backers. They wanted a straight-forward bailout to pass quickly, and debate over Cantor’s provision was perceived by some bankers as slowing down the bill, although it passed just a few days later.
A government watchdog group questioned whether Cantor was looking out for the banking industries’ interests.
“On the big picture, he still delivered,” said Bill Allison, a senior fellow at the Sunlight Foundation, which works to promote open government.
Cantor’s top industry contributors — real estate, insurance, and the securities and investment sector – account for more than $1.8 million of his campaign funds since he first ran for Congress in 2000 through September 2, 2008, according to the Center for Responsive Politics.
Cantor, known as prolific fundraiser, received $229,000 in campaign contributions from commercial banks and bank holding companies between January 2003 and August 2008.
Allison said the contributions helped bankers get Cantor’s ear.
Cantor was not a top beneficiary of the banking industry. Twenty-five other members of Congress received more from the industry, according to MAPlight.org, which tracks money and politics online.
“Contributions don’t have any influence on how I vote,” Cantor said.
Cantor’s wife, Diana, earned $84,460 in money and stock last year as a director of Media General, and $40,000 as a director of Domino’s Pizza Inc., according to filings with the U.S. Securities and Exchange Commission. She also receives an undisclosed consulting fee from New York Private Bank & Trust.
“It’s hard to think of (Eric) Cantor doing the bidding of any one industry here,” Holsworth said. “What he was attempting to do was find a way to respond to concerns of a variety of industry groups.”
(Contact Neil H. Simon at email@example.com at (202) 662-7669.)