Well before she entered politics, Rep. Katie Porter (D-CA) built a career scrutinizing the financial industry and vocally advocating for consumers—so much so that the state of California once appointed her to oversee one of the largest banking industry consumer settlements in history.
That brand became central to Porter’s successful campaigns for Congress, where she eventually made a national name for herself skewering banking CEOs during hearings. Now, running for U.S. Senate in California, she is once again promising to fight for a fairer economy.
But buried in Porter’s own personal financial disclosures, however, is a complication to that credibility: For years, her retirement account has been padded with investments in two companies that have been frequently and closely scrutinized for alleged consumer abuses.
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According to those official documents, Porter owns between $1,000 and $15,000 worth of stock in Capital One. The credit card giant has faced federal complaints over dubious marketing tactics and was called out in 2020 by Porter’s mentor and ally—Sen. Elizabeth Warren (D-MA)—for its aggressive and litigious pursuit of relatively small consumer debt.
Porter also owns between $15,000 and $50,000 worth of stock in Berkshire Hathaway. The massive conglomerate run by mega-billionaire Warren Buffett includes in its portfolio the country’s top seller of mobile homes and a related mortgage lender—both of which have faced scrutiny for discriminatory lending practices.
Both assets are held within Porter’s individual retirement account, not as part of a larger mutual fund where many different stocks are lumped together and managed by someone else. Because they are in a retirement fund, Porter likely intends to hold them for decades to slowly appreciate, not cash in by playing the market.
According to her office, Porter has held those assets within an IRA for 15 years. Upon taking office in 2019, she promised to not buy or sell any individual stocks while in Congress, so she has not touched her investments in Capital One and Berkshire Hathaway whatsoever.
“Rep. Porter believes that Congressmembers should not be able to buy or sell stocks and has publicly pledged not to do so,” said Jordan Wong, her spokesman. “She entered into Congress with some stocks long held in a retirement account and has kept her promise not to touch them. Since joining Congress, she has only invested in diversified mutual and index funds—a best practice recommended by ethics experts.”
But these companies drew scrutiny long before Porter arrived in Congress, and she had a lengthy window to offload those stocks if she had wanted to. Given her extensive expertise—she once taught university classes on the credit card industry and researched debt collection activities—it’s highly unlikely she was unaware of the corporate practices regulators, lawmakers, and the press were calling out and uncovering.
In 2012, for instance, the first company ever targeted by the Consumer Financial Protection Bureau—the government watchdog envisioned by Warren after the 2008 financial crisis—was Capital One.
The CFPB charged that a contractor for the banking giant pressured cardholders into buying expensive and ineffective additional services, which The New York Times called “one of the financial industry’s growing profit centers and increasingly controversial practices.” Capital One ultimately agreed to pay $210 million in consumer reimbursements and fines in response to the CFPB action.
Later, in 2015, a ProPublica investigation reported that “no lender sues more of its customers than Capital One,” and it was the leader in lawsuits by a considerable margin. The company took its credit card holders to court for owing as little as $1,800; many customers were subjected to wage garnishment, faced a lien on their homes, or filed for bankruptcy.
At the height of the financial crisis in 2009—after Porter had acquired Capital One stock—the company hit a high mark of 10,000 collection lawsuits that year. That happened to be the year Porter, then a university professor, took credit for helping Congress to pass a bill cracking down on credit card fees.
In 2015, when Berkshire Hathaway’s Clayton Homes was the focus of a bombshell investigation by BuzzFeed News and The Seattle Times, Porter had an additional four years to potentially sell the stock. Their report found that Clayton Homes, and its in-house mortgage provider, “systematically pursues unwitting minority home buyers and baits them into costly subprime loans,” causing many customers to “end up losing their homes, thousands of dollars in down payments, or even land they’d owned outright.”
Porter’s investment in Berkshire Hathaway has noticeably appreciated since it first appeared on her first financial disclosure in 2017, when it was listed as an asset worth between $1,000 and $15,000.
However, Porter is not the only contender in California’s Senate race to face scrutiny for their investment holdings. In 2021, Rep. Adam Schiff (D-CA), sold some $25,000 in stock in AbbVie, a pharmaceutical company that had faced allegations of price gouging around its arthritis drug, Humira. A Los Angeles Times editorial last year arguing for a stock trading ban mentioned Schiff’s sale of AbbVie as one of several supporting examples, albeit a smaller one.
Before Schiff’s sale, ironically, Porter had garnered another round of viral fame after grilling AbbVie’s CEO in an Oversight Committee hearing, using her now-trademark whiteboard to dissemble the company’s claims it needed to charge high prices to fund drug development.
In 2021, Schiff held as much as $1.3 million worth of stock, with most of it in managed funds, save for shares of Apple worth anywhere from $100,000 to $250,000. Like Porter, Schiff supports a ban on congressional stock trading, and has been a cosponsor of bipartisan legislation to achieve that goal.
Generally, it’s not uncommon to see lawmakers invest in companies they have criticized either directly or by spotlighting certain business practices.
In 2021, Insider reported that over 30 members of Congress or their spouses held stock in Facebook. Rep. Ro Khanna (D-CA), whose wife owned stock in the company, called for the company’s breakup; Rep. Marjorie Taylor Greene (R-GA), who has decried Facebook and its leadership, jointly owned as much as $50,000 in Facebook stock with her then-husband.
Kedric Payne, who tracks lawmakers’ stock activity at the Campaign Legal Center, said that Porter’s holding of bank stocks “doesn’t stand out to me as being so hypocritical.”
Still, it’s difficult to overstate the extent to which Porter’s political career has been defined by her identity as a foe to big financial institutions and an ally to consumers taken advantage of by those institutions.
At Harvard Law, Porter studied under Warren, and then became an academic herself, teaching classes on bankruptcy law and the financial industry. In 2012, then-California Attorney General Kamala Harris appointed Porter to oversee part of a $25 billion, multi-state settlement over foreclosures between state AGs and the country’s biggest mortgage lenders.
When she ran for Congress in 2018 in a Republican district, Democrats’ official campaign arm hailed Porter first as a “consumer advocate” who “has spent years fighting for the middle-class and understands the importance of holding big corporations and banks accountable.”
After her election, Porter joined the Financial Services Committee. In hearings, she garnered national attention for grilling JP Morgan Chase chief executive Jamie Dimon over his company’s low wages for tellers and caught Wells Fargo’s chief contradicting his own lawyers in that bank’s fraudulent account scandal. Stories circulated hailing Porter as “the newest threat to Wall Street.” Reports described anxious lawyers prepping their CEO clients specifically for Porter’s questions.
When Joe Biden won the presidency, Porter was mentioned in news reports as a potential nominee to lead the Consumer Financial Protection Bureau.
As she runs for the Senate seat being vacated by Sen. Dianne Feinstein next year, Porter’s consumer protection bona fides and Warren-style economic populism are key to her distinct appeal.
In fact, the collapse of California-based Silicon Valley Bank in March elevated Porter’s expertise and political views on finance in the Senate race. Along with Warren, she called for a repeal of Trump-era bank deregulation, which she argued was an enabler of bad banking behavior.
“I'm calling on Congress to restore commonsense guardrails that keep corporate greed in check and restore confidence in our financial system,” Porter said.
