Amidst Ongoing Scandal, Leon Black’s Calculated Support for Sinema Shines Light on 2018 Senate Campaign

In a tangled web of connections that has rocked the political landscape, it has come to light that Leon Black, a prominent figure in the private equity realm, not only lent his support to Senator Krysten Sinema during her 2018 Senate campaign but also finds himself entangled in the sordid saga of Jeffrey Epstein’s associations.

These revelations shed light on the complex interplay between powerful financial backers, political maneuvering, and the shadows of scandal that have cast their pall over this intricate web.

Senator Krysten Sinema has long been known for her close ties to the titans of the private equity industry, a relationship that has fueled her ascent in Congress while simultaneously stoking controversies.

The private equity industry’s influence was conspicuous during her 2018 Senate campaign, when she garnered support from influential executives, including Leon Black, the then-CEO of Apollo Global Management, a powerhouse in the world of private equity.

This backing lent her campaign a formidable boost, but the repercussions of these affiliations have come back to haunt her.

The unfolding scandal surrounding Leon Black has not only thrown a spotlight on his actions but has also raised questions about the nature of his involvement with Sinema’s political journey.

Accused of raping a 16-year-old girl at Jeffrey Epstein’s residence, Black’s financial dealings with the notorious sex trafficker have ignited a firestorm of controversy.

Documents reveal that Black contributed more than $150 million to Epstein’s coffers, exposing a connection that now reverberates in the political realm.

Black’s support for Sinema’s campaign provides insight into the compromises she might have made to rise in the ranks.

The backing of Wall Street moguls like Black undoubtedly fueled her ascent, enabling her to occupy a powerful position in Congress.

However, this association has also forced her into positions that have proved politically contentious, as she defends private equity advantages embedded in tax codes and grapples with associations that carry the risk of becoming public relations liabilities.

The extent of Black’s support for Sinema was evident in 2018 when he, alongside his wife, contributed a maximum legal donation of $5,400 to her campaign.

Fast-forward to the present, and Black is no longer at the helm of Apollo Global Management, the company he co-founded.

Revelations about his substantial financial transactions with Epstein led to his departure, thrusting the Senate Finance Committee into an investigation of potential tax evasion in these dealings.

Sinema’s connection to the private equity sector extended beyond Black, as various figures from this industry threw their weight behind her campaign.

Senior managers from Blackstone, executives from Bain, and financiers from Goldman Sachs all contributed to her political endeavors.

Yet, the magnitude of her funding also stemmed from sources such as the Emily’s List political action committee and donations from Google employees, illustrating the multifaceted support network she cultivated.

Her association with the private equity world didn’t end with the campaign trail.

Sinema’s ties to the industry remained strong, leading her to intern at a winery owned by Bill Price, a key figure in the private equity giant TPG Capital.

However, these affiliations have often led her down a path that contrasts with key Democratic priorities, including efforts to increase taxes on the wealthy to rebalance the federal budget.

Such stances have led to growing dissent within her home state of Arizona.

Stepping outside the Democratic Party’s fold, Sinema embarked on her re-election campaign as an independent.

Her path ahead is riddled with challenges, pitting her against both a Democrat and a Republican candidate in the general election.

While private equity funds continue to pour into her campaign, her Democratic opponent, Representative Ruben Gallego, has outpaced her in fundraising.

This shift signals potential repercussions for her unwavering allegiance to corporate donors.

One pivotal moment in Sinema’s trajectory was her stance on President Joe Biden’s Inflation Reduction Act, a monumental spending bill.

The senator’s crucial vote was the result of negotiation and persuasion by Senate Majority Leader Chuck Schumer.

Notably, this compromise resulted in the preservation of the carried interest tax loophole, a move that raised the ire of those advocating for tax reform.

This loophole permits hedge fund managers and private equity executives to be taxed at capital gains rates, significantly lower than standard income tax rates.

Eliminating this loophole could have generated substantial revenue over a decade.

Entities like the American Investment Council, representing industry giants such as Apollo, Blackstone, Carlyle, and KKR, fervently opposed any attempt to close the carried interest tax loophole.

Their intense lobbying efforts targeted Sinema and other senators to safeguard this financial advantage.

Even Pat Toomey, a former Pennsylvania Senator now associated with Apollo Global Management, played a role in preserving this tax benefit.

However, what began as a strategic investment by private equity leaders like Black morphed into a full-fledged alliance.

Private equity and investment firms saw in Sinema an ally to safeguard their interests, making them her primary financial support.

Donations from hundreds of employees in major Wall Street companies have poured into her campaign coffers, exceeding $3 million in contributions from investment and private equity firms over the past six years.

Campaign finance data analyzed by Open Secrets unveiled that Apollo Global Management’s employees constituted the largest corporate donor base for Sinema’s campaign committee between 2017 and 2022, contributing a total of $172,025.

A constellation of executives from firms like KKR, Carlyle Group, and Blackstone, among others, have also lent their financial support since her Senate election.

These alliances solidified her stance on the carried interest tax loophole, a decision that continues to benefit private equity tycoons like Black.

As investigations into Black’s financial dealings unfold, questions about his association with Sinema have taken center stage.

Sinema’s preservation of the tax loophole appears to perpetuate a system that enables private equity billionaires to amass substantial wealth with minimal IRS scrutiny.

The Senate committee overseeing Black’s financial activities has probed into his collaboration with Epstein, suggesting that significant payments were made to avoid substantial taxes, far surpassing typical compensation.

The controversy surrounding Black further escalated when Senator Ron Wyden penned a letter seeking additional information about the financial transactions.

The inquiry falls within a broader investigation into how ultra-high net worth individuals evade federal taxes.

The tempest continued to brew as a woman filed a lawsuit alleging that Black had raped her at Epstein’s New York City residence in 2002.

This marked the third rape allegation against Black, the second within a property owned by Epstein.

Black’s legal battles aren’t confined to the courtroom alone.

The billionaire recently agreed to a $62.5 million settlement with the U.S. Virgin Islands as part of an effort to avoid legal action stemming from the territory’s ongoing probe into Epstein’s sex trafficking network.

His troubles extend to the political arena as well, where investigators from the Senate are closely examining his actions.

In the complex tapestry of relationships, Sinema’s political journey intersects with the world of high finance and scandalous associations.

As her re-election campaign gathers momentum, the shadows of private equity funding, compromised political positions, and the unfolding Epstein saga loom large.

The outcome of this intricate interplay will shape the political landscape and test the extent to which financial backing can influence a candidate’s trajectory amidst the glare of controversy.

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The Intercept