The Troubling Business Connections of Biden’s Asia Advisor Kurt Campbell

The Biden administration has identified China as the United States’ top strategic competitor. A Project On Government Oversight investigation reveals not only that one of the officials chosen to lead this competition, Kurt Campbell, comes into office with a portfolio of former clients rife with potential conflicts of interest, but also that uncertainties remain about what steps have been taken to mitigate those conflicts.

Campbell’s financial disclosure form, obtained by POGO but which was amended twice after we requested it, paints a troublingly incomplete picture.

Biden selected Campbell to be the deputy assistant to the president and coordinator for Indo-Pacific affairs on the National Security Council (NSC) during the transition in January. In this position, Campbell is the most senior official inside the White House crafting U.S. trade and economic policies toward China, and will have “broad management over the NSC directorates that cover various parts of Asia and China-related issues,” according to Biden transition team officials.

Campbell came to the position straight from the boutique consulting firm The Asia Group, which he founded while still serving an earlier stint at the State Department. The Asia Group works with U.S. businesses to navigate the political and economic conditions in Asia. Clients include top defense contractors, insurance and entertainment companies, and casino magnates.

The Asia Group bears all the hallmarks of a “shadow lobbying” outfit, one that provides behind the scenes assistance to its clients to help secure government contracts and to otherwise bridge the gap between government and businesses. “It seems like a classic lobbying group that is designed to operate just beneath the threshold where its agents would have to actually register as lobbyists,” said Jeff Hauser, the executive director of the DC-based Revolving Door Project. His organization tracks government appointees to make sure they aren’t using their positions of public trust to further their own financial interests or those of their civilian employers. According to Hauser, calling themselves consultants allows them to avoid all the restrictions associated with traditional lobbying and makes it difficult to track potential influences and conflicts.

A spokesman for The Asia Group disagreed with that characterization of the organization. “The Asia Group has and will continue to comply with all Biden Administration guidance as appropriate. The Asia Group is a strategic advisory firm that focuses on U.S. companies seeking access to and leveling the playing field in the countries of the Indo-Pacific. The Asia Group does not lobby the U.S. government. We are predominately focused outward on the Indo-Pacific region.”

Appended to nearly every Asia Group press release is the mission statement: “The Asia Group is the partner of choice for corporate leaders, investors, academic institutions, and non-profits. We leverage decades of experience operating at the highest levels of government and business in Asia to provide our clients with strategic, high-impact, and cross-cutting advisory services.”

One of the firm’s press releases that didn’t include this mission statement was the one announcing Campbell’s departure to join the Biden administration.

Although cabinet officials are required to release their ethics agreements showing how they will mitigate or eliminate their ongoing financial conflicts, White House appointees are not. According to Campbell’s financial disclosures, he still has not sold his interest in The Asia Group. Yet, because as a White House appointee Campbell is not required to publicly disclose his ethics agreement, the degree to which he still has financial interests in his former work that would conflict with his current work remains unknown. The ethics agreement would also explain the timing and planning for a divestment from The Asia Group.

As one of President Joe Biden’s very first acts, he issued a new ethics pledge to make it harder for people to engage in shadow lobbying. Senior administration appointees now sign a pledge that for a period of two years after entering the government they will not “participate in any particular matter involving specific parties that is directly and substantially related to my former employer or former clients,” and for one year after leaving the government they “will not materially assist others in making communications or appearances that I am prohibited from undertaking myself by (a) holding myself out as being available to engage in lobbying activities in support of any such communications or appearances; or (b) engaging in any such lobbying activities.”

It is not clear if Campbell has fully divested himself from his multiple financial interests in Asia, which raises questions about ongoing conflicts as he provides the president with advice and policy recommendations. It also isn’t clear how much Campbell profited during his time at The Asia Group. He stated in his financial disclosure form that, “following my withdrawal from the Company, I will receive a lump-sum payment for the redemption of my membership interest.” The value of this payout was not disclosed. A National Security Council spokesperson said Campbell has fully divested himself from The Asia Group but declined to say how much money changed hands.

If Campbell has received that payout, there may be less reason for concern about ongoing financial conflicts. But if the matter has yet to be settled, perhaps pending a sale, that leaves the possibility that a member of the president’s staff could be open to outside influence.

Easing Myanmar Sanctions Before Building an Airport

In 2009, then-Secretary of State designee Hillary Clinton invited Campbell to be the assistant secretary of state for East Asian and Pacific affairs. At that time, he had been serving as the deputy assistant secretary of defense for Asia and the Pacific. At the State Department, he became the architect of the Obama administration’s “Pivot to Asia,” which sought to shift the United States’ foreign policy focus from the Middle East to the Asia-Pacific region. The plan that Campbell designed showed up in speeches and articles by Clinton. That plan involved six lines of action: “strengthening our bilateral security alliances; deepening our working relationships with emerging powers; engaging with regional multilateral institutions; expanding trade and investment; forging a broad-based military presence; and advancing democracy and human rights.”

With those goals in mind, Campbell focused a good deal of his time and energy on dealing with Myanmar while at State. His tenure happened to coincide with democratic reforms in the reclusive country as it began to emerge from a half-century’s rule under a military dictatorship. Following democratic elections in 2010 and the subsequent dismantlement of the military junta that had ruled since 1962, Campbell led the effort to lift U.S. sanctions against Myanmar.

He gives pride of place to his work in Myanmar in his 2016 book, The Pivot: The Future of American Statecraft in Asia, where he devotes the conclusion to recounting the story of accompanying then-President Barack Obama to the country in November 2012.

Campbell officially stepped down from his position on February 8, 2013, according to the State Department website. It subsequently emerged that he spent at least part of his time while still at State setting himself up for his post-government employment. The filing documents for The Asia Group’s limited liability corporation, available on the Delaware Division of Corporation’s website, show that Campbell formed the company on January 17, 2013, three weeks before formally departing the State Department.

His financial disclosures also show that he began working at The Asia Group in January 2013—up to a month before he left government service.

A National Security Council spokesperson said that the January 2013 registration “was related to registering elements of the Asia Group for tax purposes to ensure full legal compliance before taking on any clients after his previous government service concluded.”

Just weeks after leaving the government, and only four months after accompanying Obama to Myanmar, Campbell and The Asia Group partnered with a consortium of other firms to secure a contract worth $200 million to modernize Myanmar’s Yangon International Airport. Lifting U.S. sanctions against Myanmar undoubtedly improved the prospects for any investment in the country, such as the airport renovation project.

Selling Arms to Asia and Changing Gambling Laws in Vietnam

Campbell used his connections in Asia to score business deals across a range of industries over the years. His self-reported list of clients includes many of the major U.S. defense contractors, including Lockheed Martin, Northrop Grumman, and Raytheon. A source familiar with Campbell and The Asia Group said that Campbell received a $25,000 monthly retainer from several defense firms, and in return he only had to travel to Australia once a year to advise government officials there to keep buying U.S. weapons.

Another client we know about, but that is not listed directly in Campbell’s financial disclosures, is the disgraced hedge fund manager Phil Falcone. The Office of Government Ethics requires new appointees to list employers or clients from the previous calendar year, so Campbell and Falcone’s business relationship may not have spilled over into that time period. But the work they did together before then shows how Campbell has used his connections in the past, and could again in the future.

Falcone had hit pay dirt as the founder of New York-based Harbinger Capital Partners, having bet against subprime mortgages during the housing boom in 2007. The Securities and Exchange Commission (SEC) filed fraud charges against Falcone in 2012 for illegally using investor funds to pay off a $113 million personal tax bill, among other things. The next year, he settled the case by agreeing to an $18 million settlement with the SEC that required him to admit his fraud. The SEC banned him from operating his hedge fund for five years.

Falcone sought to use some of the money he made on Wall Street to become a casino magnate. He built the Grand Ho Tram Strip casino on the Vietnamese coast of the South China Sea, a few hours outside of Ho Chi Minh City. The venture has been moderately successful since it opened in 2013 by catering to non-Vietnamese tourists, particularly from China where gambling is illegal. Vietnam itself also restricted gambling with laws that prohibited its citizens from engaging in the activity. Falcone gambled that the Vietnamese government would lift its own gambling restrictions and allow locals to partake, which would make Ho Tram a much bigger success.

It is unclear exactly when Falcone and Campbell began working together on Vietnamese investments, but given The Asia Group’s asserted ability to “help form relationships between clients and key policy influencers, regulators and decision-makers,” it was a natural fit. In May 2017, Campbell and Falcone arranged a meeting in New York City with Vietnam’s then-Prime Minister Nguyen Xuan Phuc and the CEOs of more than 20 U.S. businesses seeking to do business in Vietnam, according to a press release posted on the embassy website. “[Falcone] hoped the Vietnamese Government will create more conditions for US enterprises to make long-term and stable investments,” the press release said. The embassy’s press release praised Falcone and Campbell for their efforts in setting up the meeting.

In December 2017, Vietnam relaxed its gambling restrictions by partially lifting the ban for its citizens: Any Vietnamese citizen who could show a minimum monthly income of $440 was now allowed to gamble in any of the country’s casinos.

Whose Interests Are Being Served?

The question remaining about Campbell and his business dealing is whether he has fully divested himself from The Asia Group. Concerns over potential conflicts of interest with his consultancy work were so great that when his wife, Lael Brainard, was being considered for Treasury secretary during the transition, ethics groups called for Campbell to divest himself of The Asia Group.

Now that he sits at the very heart of the Biden administration, those concerns are even more pressing. POGO has requested a certificate of divestiture and certificate of compliance in this case from the White House, but has yet to receive a response.

For more than a decade, Campbell has demonstrated a pattern of using his government service to enrich himself and his clients, raising questions about whose interests were at the forefront. “If before the official is out the door they are setting up a business and then immediately working with other governments to further their client’s financial interests, was the public interest being served when they were in office or were their financial interests being served?” Virginia Canter, the chief ethics counsel for the Citizens for Responsibility and Ethics in Washington, asked regarding public officials establishing consultancy firms.

Campbell may be operating with the national interest in mind. Indeed, his past government experience and scholarship might have made him the ideal candidate for his current role. But the fact that he enriched himself based on the contacts he made while serving in the government, and that he has once again found himself in a position to gather insider information and increase his rolodex for future business opportunities, calls into question every policy recommendation he will make while on the National Security Council.

Since National Security Council appointees do not go through the Senate confirmation process, they do not receive the same level of scrutiny that many of their colleagues working at a similar level on the same issues receive. During Lloyd Austin’s confirmation hearing to head the Pentagon, Senator Elizabeth Warren (D-MA) elicited a pledge from him to recuse himself from all decisions dealing with his now-former employer, Raytheon. We know of no such pledges from Kurt Campbell.