When a Former Wall Street Watchdog Gets into the Hedge Fund Game

Geithner has now secured a credit line from J.P. Morgan Chase & Co. JPM, -3.55% to finance personal investments in funds started by his new firm Warburg Pincus, according to a media report. The report is based on a filing made to New York state. Geithner, who was criticized as being too soft on Wall Street banks during the financial crisis, left the Obama Administration to join the private equity firm in November 2013. Geithner also regulated J.P. Morgan Chase as head of the New York Fed. Bloomberg News, quoting a person familiar with the situation, said Geithner is borrowing to invest in a $12 billion private equity fund that Warburg Pincus raised in November, its first fund since he joined the firm. It is what top executives at equity funds do, experts said. The source said that Warburg Pincus and executives pledged $800 million to the fund.

Crossroads had been the most active of the nonprofits that are funneling cash into politics - often called dark money because the original source of the funds may be kept secret if the organizations have social welfare as their primary purpose. During the 2012 cycle, Crossroads reported spending almost twice as much on political ads as the next most-active nonprofit, Americans for Prosperity, which is backed by conservative billionaire brothers Charles and David Koch. So far, during the 2016 cycle, the Rove group seems to be dormant. It has not filed any reports with the Federal Election Commission since January 2015, and has not reported any TV ad spending with the Federal Communications Commission. During the 2012 campaign, the group didn't start spending on TV ads until July, after Mitt Romney had locked up the GOP nomination. The IRS decision on Crossroads came in November but was first reported today by the Center for Responsive Politics. Unless new facts arise or circumstances change, past, present and future donors to the Rove group can now feel assured that they will remain anonymous. That gives Crossroads a leg up over other dark money groups that lack IRS approval and could be vulnerable to having that status challenged by the federal government at any time.