Private Equity King Visits Hill To Push Sovereign Wealth Funds

Blackstone CEO Stephen Schwarzman met with staffers from Senate and House banking committees on Friday morning, hoping to quell congressional concerns about sovereign wealth funds.

His visit comes a day after a hearing by held by Senate Banking Chairman Christopher Dodd examined the government owned funds.

Sovereign wealth funds, worth an estimated $3.2 trillion, propped up Wall Street financial institutions sapped by the current credit crunch with multi-billion dollar investments.

But they've also come under greater scrutiny from lawmakers, who wonder whether foreign governments are more interested in making money or gaining political influence. Sens. Charles Schumer, (D-N.Y.) and Evan Bayh (D-Ind.) have questioned the lack of transparency by the funds, which are not required to disclose anything about their investment strategy.

Last May, China's state-owned fund invested $3 billion in Schwarzman's public equity company. The investment helped support Blackstone's $4.1 billion initial public offering, the largest U.S. IPO in 2007. It also helped make Schwarzman one of the country's richest men, currently worth an estimated $6.5 billion.

Both the investment and IPO raised eyebrows on Capitol Hill.
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