How did Tony Podesta, who was one of the most influential lobbyists on K Street in Washington, D.C., lose it all?
At the end of 2015, Podesta’s lobbying firm, the Podesta group, was the third largest in Washington, D.C., earning nearly $30 million in revenue from more than 100 clients, including Alphabet Inc.’s Google and Wells Fargo & Co. With his longtime ally Hillary Clinton expected to become president, 2016 was looking even more promising.
During the Art Biennale in Venice, Podesta hosted lawmakers and power brokers at his flat. The residence was one of many homes he owned around the globe, including a Washington mansion where he displayed a collection of museum-quality artwork. In early 2016, he was prepared to purchase a $7.4 million condominum overlooking Madison Square Park in New York City.
“Then he fell, a calamitous collapse propelled by unexpected blows, delivered by fate and made worse by hubris. Financial problems, legal threats and the election of President Donald Trump took it all away—the clients, the firm and, finally, Mr. Podesta’s position as one of Washington’s most influential players,” according to The Wall Street Journal.
Podesta’s downfall began during the summer of 2016 when the Podesta Group lost its banker after reports surfaced that the firm did work for the U.S. subsidiary of a Russian bank under sanctions. Headlines then revealed that the group’s work with Paul Manafort, Trump’s former campaign chairman, and an associate may have violated government regulations. In October, WikiLeaks published 20,000 pages of emails stolen from Podesta’s brother John Podesta, the chairman of Clinton’s presidential campaign.
Corporate clients of the Podesta Group preferred not to be associated with such publicity, although Podesta operated the firm as if it was unaffected by the developments.
After spending most of the fall traveling the world, Podesta returned to the U.S. on Election Day. Clinton’s fortunes turned sour upon losing the election, and so did Podesta’s.
Clients who had hired his firm to gain access to a new Clinton administration changed their minds. By the end of the year, departures of those clients cost the group more than $10 million in annual business, according to an internal Podesta Group accounting viewed by The Wall Street Journal.
After years of spending on fine art, luxury vacations and high-end real estate, Podesta was overleveraged and deeply in debt, prompting him to shutter the 62-person Podesta Group at the end of 2017. Podesta has also been forced to sell his New York City condominium, as well as some of his prized sculptures.
A spokeswoman for the Podesta Group responded to questions on behalf of Podesta, contending that Podesta’s clients, colleagues, friends, and “even many of his political adversaries through the years continue to rely on his wise counsel. When he stepped down from the firm he expressed his ongoing gratitude to all of them and his commitment to continue his advocacy for the issues and ideals he’s always fought for.”