Tipping the Scales: Part III

When Harry Alford Speaks Up, a Washington Firm’s Clients Gain

By Zachary R. MiderZachary R. Mider

By Washington standards, the National Black Chamber of Commerce is a shoestring operation, run by a husband-and-wife team out of an office on the edge of the city.

But Harry Alford, the group’s founder and chief executive officer, matters in this town. When he’s not testifying before Congress or appearing on Fox News, lawmakers are citing his research on the Senate floor, or federal judges are pondering his court briefs. He speaks out on an astonishing range of issues, some of which have only the fuzziest connection to his stated goal of promoting African-American entrepreneurship.

Alford has filed friend-of-the-court briefs in recent years challenging Playboy centerfold Anna Nicole Smith’s claim to an oil fortune, backing a finance executive’s quest for a $7 million severance and siding with Samsung Electronics Co. in a patent dispute with Apple Inc.

Outside the courtroom, he has endorsed a phosphate mine, opposed gambling expansion in Maryland and advocated for the owners of Argentine debt. He has weighed in on a rum-tariff dispute involving the U.S. Virgin Islands and favored restrictions on solar power in Florida. He has both invited and opposed a shutdown of mortgage giants Fannie Mae and Freddie Mac.

Image of Harry Alford
Harry Alford in 2009. Photographer: Andrew Councill/MCT/MCT via Getty Images

The common thread: Someone with deep pockets stood to gain from Alford’s words. Many of his efforts also coincided with campaigns run by DCI Group LLC, a Washington consulting firm that gets paid to generate just the sort of advocacy Alford provides. While the chamber doesn’t disclose all of its contributors, it has acknowledged taking money from many companies that benefit from its advocacy.

Alford declined to comment for this story. Craig Stevens, a DCI vice president, said the firm is proud of its role getting people involved in the democratic process.

“Our democracy is stronger when citizens act and inform the government of how legislation, regulations, or judicial rulings impact Americans’ lives and provide policymakers with ways—if necessary—to improve them,” Stevens said in an email.

Collecting Checks

A former University of Wisconsin linebacker, Alford, 69, ran a minority chamber of commerce in Indiana before founding the national group in 1993 and moving to Washington.

At first, he got headlines for accusing businesses of discrimination, as he had in Indiana. He objected to a casino being built over a slave graveyard in Louisiana, urged a bank to increase lending in black neighborhoods and sued a telephone company, U.S. West, claiming bias against minority vendors.

“He was very helpful in the beginning,” said Herman Malone, a Denver businessman who once served as the chamber’s chairman and urged it to pursue the U.S. West suit.

As time went on, Malone said, Alford seemed to grow more interested in collecting checks from corporate executives than cajoling them.

“He kind of lost his way in who he was truly representing,” Malone said. “He used it as a vehicle to get into the corporate world.”

In a book about the U.S. West case, Malone wrote that some plaintiffs grew suspicious of Alford’s motives after he urged them to settle during a meeting in Colorado and then caught a ride back to Washington on the U.S. West company jet.

“They claimed I sold them out,” Alford wrote in a 2014 syndicated column defending his work. “Nothing bad happened on that plane—the NBCC did not receive a nickel.”

Alford testified against the Kyoto Protocol in Congress in 1998, arguing that limits on greenhouse-gas emissions would harm minorities. By the next decade, the chamber was as prominent for its pro-fossil-fuel advocacy as anything else it was doing.

Environmental groups including the Natural Resources Defense Council have accused the chamber of shilling for the industry. Exxon Mobil Corp., a DCI client, has said it gave the group more than $1 million since 2002. Alford has said he’s proud to take fossil-fuel money.

“Of course we do and it is only natural,” he wrote in a column in black newspapers in 2015. “The legacy of blacks in this nation has been tied to the miraculous history of fossil fuel.”

Supporting Role
The National Black Chamber of Commerce has backed many causes that benefit big companies and wealthy investors.
NBCC Action Beneficiary Hired DCI Donated to NBCC
Opposed Puerto Rico bankruptcy bill Investors in Puerto Rico bonds Check mark
Criticized government handling of Fannie Mae Investors in Fannie Mae shares Check mark
Opposed limits on swipe fees Visa Check mark
Opposed pollution regulations Exxon Mobil Check mark Check mark
Bought ad supporting phosphate mine Mosaic
Backed Samsung at Int'l Trade Commission Samsung in dispute with Apple Check mark
Advocated for Argentine bondholders Investors in Argentine bonds Check mark
Supported solar measure backed by utilities Gulf Power Check mark
Opposed Anna Nicole Smith's claim on fortune Heirs of billionaire J. Howard Marshall II Check mark
Opposed casino expansion in Maryland Penn National Gaming Check mark Check mark
Fought "gainful employment" rule For-profit college operator EDMC Check mark Check mark
Defended rum tariff rules in U.S. Virgin Islands Fortune Brands and Diageo
Source: Bloomberg News reporting

White Paper

Alford, who’s also on the board of the U.S. Chamber of Commerce, branched out into other issues. In 2011, he campaigned against a proposed Department of Education rule that would cut off student aid at schools that saddle graduates with too much debt relative to earnings.

Alford released a white paper, held media conference calls, started a website and testified before Congress, arguing that the rule would diminish opportunities for minority students. Education Management Corp., one of the schools affected by the rule and a DCI client, was listed as a sponsor of the National Black Chamber’s annual convention in 2014 and 2015.

Another convention sponsor was Penn National Gaming Inc. In 2012, the company hired DCI to torpedo a ballot measure that would expand gambling in Maryland, threatening Penn casinos. The measure passed despite Alford’s syndicated column in black newspapers urging a “no” vote. A spokesman for Penn said the gambling company has been a member of the chamber since 2008.

In recent years, Alford has taken an interest in the rights of investors in securities, an emerging DCI specialty. In 2009, he urged Congress to punish Argentina for refusing to repay bonds whose owners included hedge fund manager Paul Singer. And last year, he wrote a letter to House Speaker Paul Ryan asking him to consider the rights of holders of Puerto Rican bonds.

Alford filed legal briefs in two court cases that indirectly helped shareholders of the mortgage company Fannie Mae, another DCI cause. They are among more than a dozen the chamber has filed as a friend of the court in the past decade on issues ranging from retirement advice to labor unions. They include two that supported another DCI client, the family of Texas billionaire J. Howard Marshall II, in feuds with his widow Anna Nicole Smith and the Internal Revenue Service.

Feeding Lines

Sometimes, Alford’s public statements leave clues that someone else is feeding him lines. The Huffington Post pointed out that his 2015 op-ed in the Hill defending Education Management contained a parenthetical note to Alford from the piece’s actual author that hadn’t been removed.

A 2010 chamber press release about the Marshalls’ battle with Smith was written by a junior DCI employee, whose name appears as the electronic document’s author. The same goes for a 2013 Alford letter to the U.S. International Trade Commission defending Samsung in the patent dispute with Apple.

Alford’s campaigns haven’t always meshed with DCI’s. He’s a critic of the Durbin Amendment, which limits debit-card swipe fees. DCI’s retailer clients support it. In 2014, Visa Inc., one of the biggest opponents of Durbin, sponsored a reception at the chamber’s convention in Chicago.

DCI was founded in 1996 by three public relations executives who had worked for R.J. Reynolds Tobacco Co. They’d pioneered the use of smokers’ rights groups to promote the industry’s message. At DCI, their client base expanded to include companies such as AT&T Inc. and Goldman Sachs Group Inc.

The chamber isn’t the only nonprofit that has frequently worked alongside DCI. The public-affairs firm recruited the 60 Plus Association, which bills itself as a conservative answer to the AARP, to lead a campaign in favor of holders of Puerto Rican bonds, according to the New York Times. The Center for Individual Freedom, created by a tobacco operative in 1998, has taken positions on behalf of Fannie Mae shareholders, Puerto Rico bondholders and the Marshall family.

The chamber has just two executives, Alford and his wife, according to a 2014 IRS filing. A man who answered the door one morning in August at the group’s otherwise unoccupied office in Washington’s Friendship Heights neighborhood said Alford wasn’t there and meets by appointment only.

Although the chamber says it has 140 local chapters and “reaches” 100,000 black-owned businesses, revenue from membership dues was just $2,114 that year. “All other contributions,” a category that can include corporate donations, provided $1.3 million, almost all of the chamber’s annual budget. The chamber isn’t required to disclose its donors.

Last year the Checks and Balances Project, a pro-clean-energy watchdog group, complained to the IRS that the chamber’s “primary activity appears to have been direct and grassroots lobbying to advance the agenda of its various corporate sponsors.” The IRS hasn’t acted publicly on the complaint.

Correction to include a comment from DCI Group