Yet it also said that its legislative affairs team would now report to the telecom’s general counsel, David McAtee. The team’s senior executive vice president, Bob Quinn, will be “retiring.”
Here’s the full text of the memo, which was obtained by DealBook:
Our company has been in the headlines for all the wrong reasons these last few days and our reputation has been damaged. There is no other way to say it – AT&T hiring Michael Cohen as a political consultant was a big mistake.
To be clear, everything we did was done according to the law and entirely legitimate. But the fact is, our past association with Cohen was a serious misjudgment. In this instance, our Washington D.C. team’s vetting process clearly failed, and I take responsibility for that. Here is more information on this issue, if you’re interested.
For the foreseeable future, the External & Legislative Affairs (E&LA) group will report to our General Counsel David McAtee. Bob Quinn, Senior Executive Vice President – E&LA, will be retiring.
David’s number one priority is to ensure every one of the individuals and firms we use in the political arena are people who share our high standards and who we would be proud to have associated with AT&T.
To all of you who work tirelessly every day to serve customers and represent the brand proudly, thank you. My personal commitment to you is – we will do better.
In a separate document, the company discussed several other points about the hiring of Essential Consultants— including the fact that Mr. Cohen approached AT&T:
Michael Cohen approached our External Affairs organization during the post-election transition period and said he was going to leave the Trump Organization and do consulting for a select few companies that wanted his opinion on the new President and his administration – the key players, their priorities, and how they think.
The company also noted that it had hired “political consultants” in the past, especially at the beginning of new administrations.
The AT&T memo comes after Novartis’s C.E.O. of three months, Vasant Narasimhan told his employees on Thursday that the revelations of the drug company’s $1.2 million contract with Mr. Cohen led to “not a good day for Novartis.” (The contract was signed under Mr. Narasimhan’s predecessor.)
The big issue: It’s not clear that Novartis, seeking counsel on issues like drug pricing, or AT&T, which wanted advice on its Time Warner deal and net neutrality, got much from Mr. Cohen in the end. (The Justice Department sued to block AT&T’s transaction, after all.)
In other Michael Cohen news: The Treasury Department has begun an inquiry into how Michael Avenatti, Stormy Daniels’s lawyer, obtained Mr. Cohen’s bank records.
— Michael de la Merced
Behind China’s debt crackdown
As Beijing metes out tough prison sentences — the former chairman of Anbang Insurance Group, once a highflier, just got 18 years — and lets shadow lenders wither, China is signaling that it is serious about its debt problem. (The total was 256 percent of G.D.P. as of last year.)
Debt appears to be one of the things that keep President Xi Jinping awake. From a 2016 speech highlighted by the NYT:
“Some financial risks are longstanding, lurking sources of infection that are concealed very deep but may erupt in a flash. The United States subprime crisis erupted in a night. If we’re going to have big trouble in the future, it could well be in this area, and this demands high vigilance.”
(Another of his worries: losing a tech race to the West.)
But reducing debt will be difficult, as Christopher Lee of S.&P. Global told the NYT: “Like any deleveraging campaign, it is not painless.”
What’s on our economic radar
Oil: Bank of America Merrill Lynch analysts are talking about $100 a barrel next year. Military exchanges between Israel and Iran haven’t helped. (But the Blackstone Group appears ready to profit if prices rise.)
Lending: It has been a huge driver of economic growth, but has slowed in recent years, Peter Eavis writes. In March, bank loans to companies rose just 2.5 percent, compared with an average of 7 percent over the past three years; corporate bond issuance is down 14 percent from last year. The longer credit growth lags, the less likely a Trump boom becomes.
Trade: While Commerce Secretary Wilbur Ross said the U.S. had made progress in negotiations with China, there’s more to do. And if the White House wants a new Nafta deal passed this year, House Speaker Paul Ryan says the deadline for a final version is next Thursday.
Stocks: Third Point’s Dan Loeb thinks that investors are getting worried about companies’ trading multiples and is looking for signs of a looming recession.
The political flyaround
• Rudy Giuliani resigned from the law firm Greenberg Traurig, which then undercut his claims about payments to Stormy Daniels. (NYT)
• President Trump is expected to drop a campaign pledge to have Medicare negotiate lower drug prices. The F.D.A. acknowledged a shortage of EpiPens.
• What automakers are likely to raise with Mr. Trump at a C.E.O.s’ meeting today. (NYT)
• The White House’s choice for assistant Treasury secretary for international finance, Adam Lerrick, has withdrawn. (Politico)
• Scott Pruitt dined in Rome with a cardinal who has denounced action against climate change as “pagan emptiness” (and who faces sexual abuse charges). A White House spokesman said yesterday that allegations against the E.P.A. chief “have raised some concerns.”
What happens when Apple and Goldman Sachs team up?
They’re working on an Apple Pay-branded credit card. That would let Apple juice its services revenue as iPhone sales slow, and Goldman expand its consumer lending to make up for falling trading revenue. The loser: Barclays, whom Goldman would replace.
But they would face challenges. More from Tripp Mickle and Liz Hoffman of the WSJ:
The push into credit cards is fraught for Goldman, whose track record in consumer finance is scarcely two years old. Credit cards are a cutthroat business dominated by larger rivals like JPMorgan Chase and Citigroup. Yields are falling. And Goldman lacks much of the infrastructure to be able to issue credit cards and process payments to merchants.
Elsewhere in financial services: Morale at Deutsche Bank’s U.S. operations is dropping. Bank of America spoke of selling its piece of a loan to Remington Outdoor.
The deals flyaround
• Media M.&A. moves have clouded the fate of television shows. (That said, R.I.P. “Brooklyn Nine-Nine.”) What Liberty Media’s Greg Maffei thinks of the deal making.
• Silver Lake agreed to buy ZPG, a British online real estate platform operator, for about $3 billion. (Bloomberg)
• We like the code names in Takeda Pharmaceutical’s deal for Shire: Takeda was “Yamazaki,” Shire “Hibiki.” (Bloomberg)
• Dan Loeb’s Third Point is reportedly in talks to set up a blank-check acquisition company. (Reuters)
• Why Alphabet might invest in Flipkart alongside Walmart. Robinhood, an online brokerage, has raised $363 million at a $5.6 billion valuation from the likes of DST Global. New Zealand’s sovereign wealth fund has invested $65 million in Rubicon Global, a trash-collecting start-up.
• Volvo’s parent company has reportedly hired Citigroup, Goldman Sachs and Morgan Stanley to run an I.P.O. The biggest I.P.O. of the year so far, AXA Equitable, fell in initial trading. Thoma Bravo is reportedly considering an I.P.O. or sale of Dynatrace, a business software maker.
• Saint-Gobain of France dropped its long-running takeover bid for a Swiss rival, Sika. (FT)
See thousands of the Russian ads that ran on Facebook
Democrats on the House Intelligence Committee published 3,519 ads bought by the Internet Research Agency, a Russian entity accused of interfering in the 2016 presidential election. Their target audiences include fans of Sean Hannity and supporters of Black Lives Matter. Facebook conceded that it was “too slow to spot this type of information operations interference,” but said it was working to prevent such abuse.
Elsewhere in Facebook: A Calstrs portfolio manager compared the company’s dual-class stock structure to a “dictatorship.” (Note: The New York Times Company also has dual-class stock.)
Cryptocurrency corner: Huawei is giving its users easier access to Bitcoin. Cryptocurrency-inspired art is now a thing, with a disintegrating portrait of Jamie Dimon fetching $33,000.
Elsewhere in tech: SoftBank’s Masa Son has changed tech investing, for good and bad. Amazon has reportedly stopped buying “Shopping” ads in Google results. Apple has scrapped plans for a $1 billion data center in Ireland. How Didi Chuxing teamed up with Uber’s biggest rival in Brazil, 99. Panasonic is reportedly hesitant to invest more in a battery partnership with Tesla.
• JPMorgan Chase named Chris Berthe as global head of cash equities execution, leading teams that electronically match stock buyers and sellers. (CNBC)
• Moelis & Company has hired Anuj Mathur as a managing director specializing in internet and digital media investment banking. (Moelis)
The speed read
• Spotify said it would stop promoting or recommending music by artists whose conduct or content it deemed offensive, including R. Kelly. (NYT)
• Elaine Wynn has emerged as a champion of shareholder rights and good corporate governance. (NYT)
• The novelist Junot Díaz, facing sexual misconduct allegations at M.I.T., is stepping down as chairman of the Pulitzer Prize board. (NYT)
• Marchesa, the brand codesigned by Harvey Weinstein’s estranged wife Georgina Chapman, is making a comeback with the support of Anna Wintour and Scarlett Johansson. (NYT)
• Bloomberg Philanthropies is investing $43 million in more than 20 small and midsize cultural organizations in seven cities. (NYT)
• MoviePass has competition. (Wired)
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