Jeff Yass millions to influence schools, courts and markets

Jeff Yass millions to influence schools, courts and markets

A portrait of Jeff Yass.

Photo: Eddie Malluk

Inside one of the largest options trading firms in the world sits a little-known charitable foundation that has quietly donated tens of millions of dollars to influence federal policy, education and legislation.

The company and foundation are twin ventures of major Republican donor Jeff Yass and a small group of allies.

Yass, a poker-playing libertarian billionaire, is the single largest donor to federal candidates this election cycle, with more than $46 million in donations so far, according to the nonpartisan organization OpenSecrets.

Yass has given very few interviews and largely avoided publicity. But his charitable giving offers a rare glimpse into his priorities and goals.

The Susquehanna Foundation is based in the same suburban office building in Bala Cynwyd, Pennsylvania, as Susquehanna International Group, the trading company that Yass co-founded, according to tax records.

According to the documents, which are valid through 2022, the foundation will be led by Yass and other experienced Susquehanna leaders.

The Susquehanna Foundation is one of two foundations that Yass and his closest friends have funded and led.

The other foundation is even less well known: the Claws Foundation. Similar to Susquehanna, Claws is the charitable arm of one person: Arthur Dantchik, co-founder of Susquehanna International Group with Yass, is the only listed donor to the Claws Foundation.

According to records, Dantchik has donated over $150 million to the organization since 2017. The group’s paperwork is stored at Sterling Foundation Management in Virginia, more than 150 miles from Susquehanna International.

Yass and Dantchik declined to comment through a spokesman.

The Susquehanna and Claws Foundations were established over the last decade entirely through contributions from Yass, his wife and other Susquehanna-affiliated allies.

The two foundations have collectively donated more than $25 million to libertarian-leaning nonprofit groups since 2016, according to more than a dozen tax filings reviewed by CNBC.

One of the main recipients was the Cato Institute, a Washington think tank that promotes libertarian ideals. Money from Yass foundations also went to the Institute for Justice, a tax-exempt legal group that has litigated cases all the way to the Supreme Court.

Another grantee is the Atlas Network, an organization dedicated to promoting “free market” principles.

The Competitive Enterprise Institute has raised money from the Claws Foundation. The Competitive Enterprise Institute has spoken out against government regulations in the financial, energy and technology industries, among other things.

Experts who reviewed the foundations’ donations for CNBC said many of the donations go to groups that advance policies that could benefit Yass, his company and those close to him.

“Ultimately, Yass channels his incredible wealth through a variety of organizations to push U.S. politics to the right, and in some cases – such as his recent advocacy for a ban on TikTok – to advance policies that benefit his bottom line.” The Watchdog’s deputy executive director, Brendan Fischer, said in an email.

For example, the Susquehanna Foundation received over $250 million from Susquehanna Growth Equity Fund III in 2020, according to the filing.

According to Pitchbook, the fund is a private equity investment vehicle controlled by Susquehanna International Group.

Yass is also the only known contributor to a political action committee, the Moderate PAC, which Politico said is trying to unseat progressive Democratic Rep. Summer Lee, D-Pa., in a primary this year, according to Politico.

Lee’s Democratic opponent has sought to distance herself from the funding the PAC received from Yass, saying at a recent debate: “I condemn Donald Trump. I condemn Jeffrey Yass.”

A joint endeavor

According to Forbes, Yass has a net worth of $27 billion. Dantchik has an estimated net worth of $7 billion.

The two men have been friends for more than 50 years, since Yass and Dantchik lived together at SUNY Binghamton in the late 1970s. They later moved to Las Vegas to become professional gamblers before co-founding Susquehanna in the 1980s.

Dantchik and Yass are both listed as directors of the Claws Foundation. At the end of 2022, they will also hold the titles of President and Vice President of the Susquehanna Foundation, respectively.

As Yass rose to the top of the country’s largest donor list, he met with Donald Trump, the presumptive Republican nominee for president, in March.

The meeting took place on the sidelines of a meeting for donors to the Club for Growth, a conservative organization that plans to support Trump over President Joe Biden in the coming months through its political action committee.

Yass donated over $15 million to the Club for Growth super PAC months before the group announced it would support Trump.

A logo sign outside the Susquehanna International Group headquarters in Bala Cynwyd, Pennsylvania, on January 3, 2016.

Kristoffer Tripplaar | Alamy

But Yass has no plans to donate to Trump’s campaign, a Yass spokesman later told The New York Times.

Some of the organizations that have received money from Yass Dantchik-led nonprofits are actively lobbying to end or limit government regulations and change the way federal agencies operate.

If these groups’ opposition to policy proposals is implemented, it could impact Yass and Susquehanna, including their investment in TikTok’s parent company ByteDance, according to Anna Massoglia, investigations manager at OpenSecrets.

Dantchik is reportedly on the board of ByteDance. Susquehanna International Group owns a 15% stake in ByteDance.

“These donations represent targeted investments in organizations that fight regulation and promote free market policies, which could benefit Yass when so much is at stake if the U.S. government cracks down on his company’s investments like TikTok said Massoglia.

The House of Representatives passed a bill in March that, if enacted, would give China-based ByteDance about six months to divest TikTok or the social media app would no longer be available for download in the United States.

The Cato Institute has received about $6.8 million from the Susquehanna and Claws foundations since 2016, according to tax records.

Nearly half of that amount came from a $3 million donation from the Susquehanna Foundation in 2022, the year Yass was named Cato’s executive vice chairman.

Yass no longer holds that position or a seat on Cato’s board. A Cato spokesman did not respond to CNBC’s questions about why Yass is no longer a trustee.

Cato’s political goals coincide with Yass’s political and financial interests.

This year alone, Cato officials have taken positions on at least two major issues affecting Yass and his company.

TikTok creators gather before a press conference to express their opposition to the “Protecting Americans from Foreign Adversary Controlled Applications Act” that calls for a crackdown in the House of Representatives on Capitol Hill in Washington, United States, March 12, 2024 against TikTok is waiting.

Craig Hudson | Reuters

“Given that 170 million Americans use TikTok – or more than half the country – the specter of a ban on the popular app could provoke massive popular backlash if given time to develop. “You are right to be concerned,” said a Cato article published earlier this spring.

“The bill raises serious concerns about free speech and future government interference in social media,” said another Cato article that appeared around the time of the House vote.

Club for Growth has also spoken out against a ban on TikTok.

Yass and his company could also benefit from limitations on the Securities and Exchange Commission’s regulatory power. In March, Cato’s Jennifer Schulp testified before the House Financial Services Committee, where she advocated for SEC reforms.

Beyond TikTok

And it’s not just groups that have spoken out against a TikTok ban, but have also received support from Yass-run foundations.

“This kind of spending by Yass’s foundations easily puts him in a rarefied space among major donors that support conservative causes and think tanks with a clear libertarian bias,” said Robert Maguire, director of Citizens for Responsibility and Ethics.

Millions of dollars have flowed from the foundations to groups advocating for Yass and his wife’s top priority: “school choice.”

The advocates are largely funded by libertarian and conservative donors like the wealthy DeVos family. Advocates want parents to have access to tax dollars to cover tuition at charter or private schools.

The foundations led by Yass have also joined forces to donate over $5 million since 2016 to the Institute for Justice, a nonprofit legal group.

The Institute for Justice has advocated for school choice in court cases.

She has also opposed sweeping campaign finance reforms, such as rules that would require tax-deductible charities to disclose the names of their donors.

“Forcing people to disclose even the most petty political activities and publishing that information in a publicly accessible database exposes virtually all political donors to retaliation and coercion from their neighbors, bosses, customers, confidants and even family,” it says a post from the institute’s Make No Law website, archived by the Wayback Machine.

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2024-04-09 19:51:36