Former local U.S. Congressman Sweeney defends Russian bank work

Former congressman says sanctions hurt international economic ties
Then U.S. Rep. John Sweeney, left, is seen with former NYC Mayor Rudy Guiliani and Gov. George Pataki in 2006.
Then U.S. Rep. John Sweeney, left, is seen with former NYC Mayor Rudy Guiliani and Gov. George Pataki in 2006.

ALBANY — U.S. sanctions on Russian businesses shouldn’t be used as punishment and need to be flexible enough to recognize when businesses change their behavior, according to former U.S. congressman John E. Sweeney.

“Sanctioned businesses that show good faith should be able to renew dialog with the U.S. government and find a path forward to be removed from the list, despite a country’s differences,” Sweeney wrote in a draft opinion piece.

In an unpublished draft opinion piece and in an interview this week, the former Capital Region Republican congressman defended his lobbying in Washington, D.C., for a state-owned Russian bank that is under U.S. economic sanctions, and other businesses in Eastern Europe.

The current sanctions on Russia were imposed by President Barack Obama’s administration in 2014 following aggressive Russian military moves into the Ukraine, including the invasion of Crimea. The sanctions effectively prohibit direct economic contacts between the Russian bank and U.S. companies and financial institutions.

“I’m hired to represent this bank and go to both the [federal] legislators and the Trump administration and say ‘we have changed our behavior,’ and I can advise them in how to move around Washington and make their case,” Sweeney said in the interview.

Sweeney in August filed paperwork with the U.S. Department of Justice saying he is acting as a foreign agent, with a lobbying contract to represent Vnesheconombank State Development Corp., a Russian state-owned development bank with leaders appointed by the Kremlin.

Vnesheconombank is the largest development bank in Russia, working to finance large-scale projects to develop the country’s infrastructure and industrial production. The bank is headed by Igor Shuvalov, an appointee of Russian President Vladimir Putin and former first deputy prime minister in Putin’s cabinet.

“A huge part of legal practice has been representing and giving advice to these people,” said Sweeney, an attorney practicing in Abany and Washington.

Other client’s of Sweeney’s firm since the 2016 election have been telecommunications giant Comcast Corp., Royal Dutch Shell, NES Financial and Nord Stream 2 AG, the Swiss conglomerate looking to build a natural gas pipeline from Russia to Europe, bypassing the Ukraine.

Sweeney, one of a host of former members of Congress who now lobby, is being paid $62,500 a month for “provision of legal services that may include potential meetings with U.S. government officials regarding potential new sanctions legislation (not existing sanctions) that could affect the activities of [Vnesheconombank].”

Sweeney, 64, of Clifton Park, represented parts of the Capital Region in Congress from 1997 to 2006, but lost his re-election bid to now-Sen. Kirsten Gillibrand in 2006. He was co-chairman of President Donald Trump’s New York primary campaign in 2016, helped with the vetting of political appointments after the general election, and remains supportive of Trump.

Sweeney said the bank’s concern is with legislation proposed in the House and Senate that would establish new sanctions on Russian businesses, including Vneshecononbank, in an effort to deter future interference in U.S. elections such as what occurred in 2016.

Though the Mueller report last spring reached the conclusion that “the Russian government interfered in the 2016 presidential election in a sweeping and systemic fashion,” Sweeney remains dismissive. “If there was interference, it was minimal,” he said in the interview.

Sweeney acknowledged that VEB in the past financed Russian military operations and Russian client states like Venezuela, but said since the sanctions were imposed it has changed its strategy, and now focuses on financing development of industrial, energy and infrastructure projects within Russia, including the conversion of former military bases to other uses.

“My client has changed its behavior, so the sanctions have done their jobs, there’s no longer need for sanctions,” Sweeney said.

Sweeney said representatives of the Russian bank contacted him about lobbying work after he went to Russia as part of an American Bar Association trip in 2017 and spoke in front of several business audiences.

He argues that both countries will benefit if the U.S. engages more with Russia, and economic ties can spread western values to Russia. “President Trump wanted to recognize the strategic importance of Russia,” he said.

“The more we pull them West, the more we move them toward free market principles,” Sweeney said. “They’re either going to move East [toward an alliance with China] or move West.”

“Strategically, we need a relationship with them that is something other than hostile,” he said. “This is not condoning any of the actions of the Putin administration.”

Sweeney, a Troy native, has been respected for his political skills in state and national Republican circles for decades. He rose through Rensselaer County politics and became an operative in state politics, at one point serving as executive director of the state Republican Committee. In 1998, in his first bid for elected office, he won what was then the 20th Congressional District seat, following the retirement of U.S. Rep. Gerald Solomon. After the 2000 presidential election, he was involved in efforts to halt a recount in Florida that could have threatened president-elect George W. Bush’s victory over Vice President Al Gore.

Reach Gazette reporter Stephen Williams at 518-395-3086, [email protected] or @gazettesteve on Twitter.


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