Seeking advance word of government decisions is part of a growing practice in Washington between hedge funds and lawmakers. Brody Mullins, Michael Casey, and Paul Vigna discuss on Markets Hub. Photo by Associated Press. 
 
 When Senate Democrats finally brokered a compromise over the proposed health-care law, a group of hedge funds were let in on the deal, learning details hours before a public announcement on Dec. 8, 2009. 
 
 The news was potentially worth millions of dollars to the investors, though none would publicly divulge how they used the information. They belong to a select group who pay for early, firsthand reports on Capitol Hill. 
 
 Seeking advance word of government decisions is part of a growing, lucrative—and legal— practice in Washington that employs a network of brokers, lobbyists and political insiders who arrange private meetings between hedge funds and officials, including lawmakers and their aides. 
 
 With markets moving sharply on actions in Washington, hedge funds and other big Wall Street players are willing to pay for access. News tips, combined with data and analysis, help steer firms to profitable investment decisions. 
 
 The meetings can be fishing expeditions, with clients sometimes leaving empty-handed. But if there's news pending, these hedge funds are often among the first in line to hear. 
 
 New York-based brokerage firm JNK Securities has emerged as one of the most aggressive of the dozens of companies that escort clients around Capitol Hill. JNK Securities arranged the Dec. 8, 2009 health-care briefing and more than 200 similar sessions over the past three years. 
 
 Hedge-fund managers at Viking Global Investors and Karsch Capital Management were among investors who met privately that afternoon in a nondescript Capitol basement with senators whose support was crucial to passage. 
 
 Enlarge Image Close Associated Press Hedge funds last year met with lawmakers, including Rep. Carolyn Maloney (D.,N.Y.) on Capitol Hill. 
 
 Enlarge Image Close Brody Mullins/The Wall Street Journal A hearing room in Congress. 
 
 The lawmakers said they would soon reach a deal that eliminated a proposed government-run insurance plan, according to people there. 
 
 The deal, announced after markets closed, helped buoy shares of such giant health insurers as Aetna Inc. and Cigna Corp. through the end of the year: A government plan could have posed serious competition. 
 
 Viking and Karsch placed bullish bets on health-insurance stocks including Aetna during the fourth quarter of 2009, which they sold in the first quarter of 2010, according to regulatory records that don't pinpoint trading dates. Shares of Aetna rose more than 6% within days of the announcement. 
 
 "Hedge funds and other investors have found that Washington can be a gold mine of market-moving information, easily gathered by those who are politically connected," according to Sanford Bragg, CEO and president of Integrity Research Associates, an independent group that analyzes research providers. 
 
 Wall Street firms have for years hired lobbyists to scour Congress and the White House for news that could affect stock prices. Now, investors want to hear from decision makers firsthand. 
 
 Many turn to William Williams, president of JNK Securities, a firm that brings lawmakers and investors together "to bridge the information gap between Washington and Wall Street," according to a recent news release. 
 
 Mr. Williams used to charge clients as much as $10,000 for meetings with lawmakers. That changed last year after a reporter from the publication Inside Higher Ed asked the office of Sen. Tom Harkin (D., Iowa) about an email from JNK showing it was charging to attend a possible meeting with the senator. Mr. Harkin refused to attend. 
 
 Now, hedge funds don't pay fees to JNK Securities. If they use information gleaned at these face-to-face meetings they are expected to execute their trades through the brokerage firm, which collects commissions. 
 
 Mr. Williams is a former football player who attended the Air Force Academy before transferring to the University of Pennsylvania. After college, he founded a hedge fund focused on telecommunications, media and technology industries. Later, he was a portfolio manager at Eagle Asset Management. 
 
 In 2009, he saw he could drum up business for JNK Securities by organizing meetings between investors and government officials, tapping into a growing appetite on Wall Street for public policy news. 
 
 Enlarge Image Close European Pressphoto Agency Sen. Joe Lieberman (I., Conn.), left, with Sen. Tom Carper (D., Del.) last month. 
 
 Enlarge Image Close Brody Mullins/The Wall Street Journal Lieberman and Carper met with hedge funds in the U.S. Capitol, pictured, over heath-care negotiations hours before a final deal on Dec. 8, 2009. 
 
 These days, he organizes more than a dozen meetings a month with members of Congress and others. Mr. Williams recently hired a former Washington lobbyist and onetime Capitol Hill aide to organize most of his meetings. 
 
 "It's a great business model and that's the problem," said Richard Painter, a former White House ethics lawyer for President George W. Bush and now a law professor at the University of Minnesota. 
 
 When investors, for example, wanted to know how Congress would weigh in on the proposed merger between Express Scripts Inc. and Medco Health Solutions Inc., Mr. Williams set up a face-to-face session Dec. 1 with a top aide to Sen. Herb Kohl, the Wisconsin Democrat who chairs the Senate's antitrust subcommittee. The meeting was set up by Paul Bock, a lobbyist who once served as Mr. Kohl's chief of staff. 
 
 Some lawmakers seek to crack down on the practice, described by Mr. Painter as "buying information from members of Congress in a perfectly legal way." A bill sponsored by Rep. Louise Slaughter (D., N.Y.) would bar lawmakers and staff from disclosing market-moving, nonpublic information about pending or prospective legislation if they believe it will be used in Wall Street trades. 
 
 The legislation would require hedge funds and other firms pursuing political intelligence to disclose their activities, similar to lobbyists. It also would ban members of Congress from trading on insider information. 
 
 Mrs. Slaughter's legislation has been endorsed by a majority of lawmakers in the House. A key Senate committee chairman, Sen. Joe Lieberman (I., Conn.), is pushing legislation to require a government study of the issue. 
 
 Mr. Williams, who recently endorsed Mrs. Slaughter's legislation, was busy during the debt-ceiling debate earlier this year, with clients seeking clues whether political deadlock would lead to a U.S. default. They met, for example, with Rep. Tom Price (R., Ga.), a member of the House's tax-writing Ways and Means Committee on June 28 in New York. 
 
 Last month, JNK Securities brought a group to Capitol Hill to meet with top House telecommunications aides to discuss whether the government would grant a license to LightSquared Inc., a start-up funded largely by hedge fund Harbinger Capital Partners that wants to provide national broadband wireless service. 
 
 A spokeswoman for the House Energy and Commerce Committee declined to comment, as did Mr. Price. 
 
 Earlier this fall, Rep. Adrian Smith (R., Neb.) was peppered with questions from hedge funds about whether the congressional supercommittee would raise taxes on companies incorporated as master limited partnerships during a Sept. 26 lunch hosted by JNK Securities in New York. Such a tax increase would hit shares of master limited partnerships that are publicly traded. 
 
 Mr. Smith, a member of the Ways and Means Committee, told the group such tax changes should come through a separate tax-reform bill, which made the prospects seem unlikely. That was a valuable insight for investors involved with publicly traded investment funds. 
 
 Lawmakers defend the meetings. Republicans say they seek the views of hedge fund managers to help shape laws that spur investment. 
 
 Democrats say the conversations lead to better public policy because investors tell them about loopholes, inefficiencies or unseen consequences of existing laws. 
 
 Last year, Mr. Williams spent much of his time arranging meetings over the financial regulatory legislation known as the Dodd-Frank bill. He held more than a dozen sessions between lawmakers and hedge funds during seven months of Senate debate on the measure, according to people who attended. 
 
 On Jan. 28, 2010, his group met on Capitol Hill with Sen. Christopher Dodd, the Connecticut Democrat, now retired, who chaired the Senate's Banking Committee, according to attendees. 
 
 At the time, investors assumed Mr. Dodd would support legislation from Sen. Richard Durbin (D., Ill.) to cap fees that Visa Inc. and MasterCard Inc. collect on debit-card purchases. The possible fee cap weighed on the share price of the two credit card giants because it would shrink revenues. 
 
 Mr. Dodd signaled to the hedge funds that he wouldn't include Mr. Durbin's provision in his bill, a position favorable to Visa and MasterCard that didn't surface for weeks, according to people at the meeting. 
 
 Among the funds attending was Conatus Capital Management, with $2.5 billion under management. In the first quarter of 2010, the hedge fund added more than 300,000 shares of Visa, according to public filings, a 50% hike that brought its holding to 950,000 shares. 
 
 Visa share prices rose from $81 at the end of January to a high of about $96 in April before falling to around $70 by mid-May. 
 
 On June 15, 2010, two weeks before a final agreement on the Dodd-Frank bill, JNK Securities arranged an all-day roster of meetings for clients. 
 
 The brokerage firm reserved a hearing room in a House office building for briefings by several lawmakers and aides. Hedge-fund managers sat in chairs on the dais normally reserved for lawmakers during congressional hearings, according to attendees. Among those who spoke was Rep. Carolyn Maloney (D., N.Y.), a senior Democrat who was negotiating with Mr. Durbin on behalf of the House on the debit-card fee cap. 
 
 Mrs. Maloney said the House would support Mr. Durbin's provision if, among other things, it exempted debit cards used by states to distribute government benefits to the poor. Her position ended up in the law. 
 
 Mrs. Maloney said she met the investors "because many were constituents and it was an opportunity to express my strong support for the financial reforms we were working on." 
 
 SAC Capital Advisors LP was among a group of about 20 hedge funds who attended the series of meetings. The sessions gave clues to the final provisions of the bill, which added to a sharp decline in financial shares. 
 
 SAC cut its holdings in some financial stocks in the second quarter of 2010, which ended two weeks later, and added others, including Bank of America Corp., Citigroup Inc. and Morgan Stanley, according to regulatory filings. 
 
 Mr. Williams also proved himself valuable during the health-care debate. 
 
 A month before his Dec. 8, 2009 meeting with senators, the House had approved legislation requiring the government to create a new public insurance plan for millions of Americans who lacked coverage. 
 
 The health-insurance industry opposed the idea because expanding the government's role could drive down prices. Shares of large national health-care insurers had been languishing over the proposal. 
 
 The outcome was uncertain as the legislation moved to the Senate in December 2009. Several moderate senators were thought to hold the decisive votes on the issue, including Mr. Lieberman and Sen. Ben Nelson (D., Neb.). 
 
 The weekend before the Dec. 8, 2009 session, Senate Majority Leader Harry Reid (D., Nev.) held Senate sessions on Saturday and Sunday, seeking a deal. Another senator, Tom Carper (D., Del.), also was trying to help. 
 
 The central issue: Would the bill call for the government to create a public health insurance plan, the position supported by President Barack Obama? 
 
 To counter Republican opposition, Democrats needed votes from Messrs. Lieberman and Nelson, who said they had major concerns with a robust government-insurance plan. 
 
 As negotiations neared a resolution, JNK Securities and its hedge-fund clients met a half-dozen lawmakers in the U.S. Capitol. Among those who spoke to the hedge funds were Mr. Lieberman and Mr. Carper on Dec. 8, according to their offices. 
 
 The roster included Viking Global's Scott Zinober and Karsch Capital's Eric Potoker. 
 
 The broad outlines of an agreement had been circulating for days, but the lawmakers confirmed they were close to a deal that discarded the public insurance plan, a boost to private insurers. 
 
 Viking, a hedge fund that manages $13.8 billion, bought six million shares of Aetna in that fourth quarter of 2009, according to regulatory filings. Karsch, which manages $2.4 billion, bought half a million Aetna shares during the same period, according to regulatory records. Shares of Aetna rose 14% in the fourth quarter. 
 
 Spokeswoman Whitney Phillips said Mr. Lieberman doesn't "give any special information to one group that he would not share with any other group, constituent or the press." 
 
 Emily Spain, a spokeswoman for Mr. Carper, said that "whether it was in conversations with constituents, members of the business community, public health experts, Congressional colleagues or the media, he regularly discussed his goals for health-care reform legislation." 
 
 That evening, the hedge fund managers retired to a nearby restaurant, Bistro Bis, where they were scheduled to have drinks with Mr. Nelson. 
 
 The senator had to take a rain check. The deal was announced past cocktail hour. 
 
 Write to Brody Mullins at brody.mullins@wsj.com and Susan Pulliam at susan.pulliam@wsj.com ||||| Seeking advance word of government decisions is part of a growing practice in Washington between hedge funds and lawmakers. Brody Mullins, Michael Casey, and Paul Vigna discuss on Markets Hub. Photo by Associated Press. 
 
 When Senate Democrats finally brokered a compromise over the proposed health-care law, a group of hedge funds were let in on the deal, learning details hours before a public announcement on Dec. 8, 2009. 
 
 The news was potentially worth millions of dollars to the investors, though none would publicly divulge how they used the information. They belong to a select group who pay for early, firsthand reports on Capitol Hill. 
 
 Seeking advance word of government decisions is part of a growing, lucrative—and legal— practice in Washington that employs a network of brokers, lobbyists and political insiders who arrange private meetings between hedge funds and officials, including lawmakers and their aides. 
 
 With markets moving sharply on actions in Washington, hedge funds and other big Wall Street players are willing to pay for access. News tips, combined with data and analysis, help steer firms to profitable investment decisions. 
 
 The meetings can be fishing expeditions, with clients sometimes leaving empty-handed. But if there's news pending, these hedge funds are often among the first in line to hear. 
 
 New York-based brokerage firm JNK Securities has emerged as one of the most aggressive of the dozens of companies that escort clients around Capitol Hill. JNK Securities arranged the Dec. 8, 2009 health-care briefing and more than 200 similar sessions over the past three years. 
 
 Hedge-fund managers at Viking Global Investors and Karsch Capital Management were among investors who met privately that afternoon in a nondescript Capitol basement with senators whose support was crucial to passage. 
 
 Enlarge Image Close Associated Press Hedge funds last year met with lawmakers, including Rep. Carolyn Maloney (D.,N.Y.) on Capitol Hill. 
 
 Enlarge Image Close Brody Mullins/The Wall Street Journal A hearing room in Congress. 
 
 The lawmakers said they would soon reach a deal that eliminated a proposed government-run insurance plan, according to people there. 
 
 The deal, announced after markets closed, helped buoy shares of such giant health insurers as Aetna Inc. and Cigna Corp. through the end of the year: A government plan could have posed serious competition. 
 
 Viking and Karsch placed bullish bets on health-insurance stocks including Aetna during the fourth quarter of 2009, which they sold in the first quarter of 2010, according to regulatory records that don't pinpoint trading dates. Shares of Aetna rose more than 6% within days of the announcement. 
 
 "Hedge funds and other investors have found that Washington can be a gold mine of market-moving information, easily gathered by those who are politically connected," according to Sanford Bragg, CEO and president of Integrity Research Associates, an independent group that analyzes research providers. 
 
 Wall Street firms have for years hired lobbyists to scour Congress and the White House for news that could affect stock prices. Now, investors want to hear from decision makers firsthand. 
 
 Many turn to William Williams, president of JNK Securities, a firm that brings lawmakers and investors together "to bridge the information gap between Washington and Wall Street," according to a recent news release. 
 
 Mr. Williams used to charge clients as much as $10,000 for meetings with lawmakers. That changed last year after a reporter from the publication Inside Higher Ed asked the office of Sen. Tom Harkin (D., Iowa) about an email from JNK showing it was charging to attend a possible meeting with the senator. Mr. Harkin refused to attend. 
 
 Now, hedge funds don't pay fees to JNK Securities. If they use information gleaned at these face-to-face meetings they are expected to execute their trades through the brokerage firm, which collects commissions. 
 
 Mr. Williams is a former football player who attended the Air Force Academy before transferring to the University of Pennsylvania. After college, he founded a hedge fund focused on telecommunications, media and technology industries. Later, he was a portfolio manager at Eagle Asset Management. 
 
 In 2009, he saw he could drum up business for JNK Securities by organizing meetings between investors and government officials, tapping into a growing appetite on Wall Street for public policy news. 
 
 Enlarge Image Close European Pressphoto Agency Sen. Joe Lieberman (I., Conn.), left, with Sen. Tom Carper (D., Del.) last month. 
 
 Enlarge Image Close Brody Mullins/The Wall Street Journal Lieberman and Carper met with hedge funds in the U.S. Capitol, pictured, over heath-care negotiations hours before a final deal on Dec. 8, 2009. 
 
 These days, he organizes more than a dozen meetings a month with members of Congress and others. Mr. Williams recently hired a former Washington lobbyist and onetime Capitol Hill aide to organize most of his meetings. 
 
 "It's a great business model and that's the problem," said Richard Painter, a former White House ethics lawyer for President George W. Bush and now a law professor at the University of Minnesota. 
 
 When investors, for example, wanted to know how Congress would weigh in on the proposed merger between Express Scripts Inc. and Medco Health Solutions Inc., Mr. Williams set up a face-to-face session Dec. 1 with a top aide to Sen. Herb Kohl, the Wisconsin Democrat who chairs the Senate's antitrust subcommittee. The meeting was set up by Paul Bock, a lobbyist who once served as Mr. Kohl's chief of staff. 
 
 Some lawmakers seek to crack down on the practice, described by Mr. Painter as "buying information from members of Congress in a perfectly legal way." A bill sponsored by Rep. Louise Slaughter (D., N.Y.) would bar lawmakers and staff from disclosing market-moving, nonpublic information about pending or prospective legislation if they believe it will be used in Wall Street trades. 
 
 The legislation would require hedge funds and other firms pursuing political intelligence to disclose their activities, similar to lobbyists. It also would ban members of Congress from trading on insider information. 
 
 Mrs. Slaughter's legislation has been endorsed by a majority of lawmakers in the House. A key Senate committee chairman, Sen. Joe Lieberman (I., Conn.), is pushing legislation to require a government study of the issue. 
 
 Mr. Williams, who recently endorsed Mrs. Slaughter's legislation, was busy during the debt-ceiling debate earlier this year, with clients seeking clues whether political deadlock would lead to a U.S. default. They met, for example, with Rep. Tom Price (R., Ga.), a member of the House's tax-writing Ways and Means Committee on June 28 in New York. 
 
 Last month, JNK Securities brought a group to Capitol Hill to meet with top House telecommunications aides to discuss whether the government would grant a license to LightSquared Inc., a start-up funded largely by hedge fund Harbinger Capital Partners that wants to provide national broadband wireless service. 
 
 A spokeswoman for the House Energy and Commerce Committee declined to comment, as did Mr. Price. 
 
 Earlier this fall, Rep. Adrian Smith (R., Neb.) was peppered with questions from hedge funds about whether the congressional supercommittee would raise taxes on companies incorporated as master limited partnerships during a Sept. 26 lunch hosted by JNK Securities in New York. Such a tax increase would hit shares of master limited partnerships that are publicly traded. 
 
 Mr. Smith, a member of the Ways and Means Committee, told the group such tax changes should come through a separate tax-reform bill, which made the prospects seem unlikely. That was a valuable insight for investors involved with publicly traded investment funds. 
 
 Lawmakers defend the meetings. Republicans say they seek the views of hedge fund managers to help shape laws that spur investment. 
 
 Democrats say the conversations lead to better public policy because investors tell them about loopholes, inefficiencies or unseen consequences of existing laws. 
 
 Last year, Mr. Williams spent much of his time arranging meetings over the financial regulatory legislation known as the Dodd-Frank bill. He held more than a dozen sessions between lawmakers and hedge funds during seven months of Senate debate on the measure, according to people who attended. 
 
 On Jan. 28, 2010, his group met on Capitol Hill with Sen. Christopher Dodd, the Connecticut Democrat, now retired, who chaired the Senate's Banking Committee, according to attendees. 
 
 At the time, investors assumed Mr. Dodd would support legislation from Sen. Richard Durbin (D., Ill.) to cap fees that Visa Inc. and MasterCard Inc. collect on debit-card purchases. The possible fee cap weighed on the share price of the two credit card giants because it would shrink revenues. 
 
 Mr. Dodd signaled to the hedge funds that he wouldn't include Mr. Durbin's provision in his bill, a position favorable to Visa and MasterCard that didn't surface for weeks, according to people at the meeting. 
 
 Among the funds attending was Conatus Capital Management, with $2.5 billion under management. In the first quarter of 2010, the hedge fund added more than 300,000 shares of Visa, according to public filings, a 50% hike that brought its holding to 950,000 shares. 
 
 Visa share prices rose from $81 at the end of January to a high of about $96 in April before falling to around $70 by mid-May. 
 
 On June 15, 2010, two weeks before a final agreement on the Dodd-Frank bill, JNK Securities arranged an all-day roster of meetings for clients. 
 
 The brokerage firm reserved a hearing room in a House office building for briefings by several lawmakers and aides. Hedge-fund managers sat in chairs on the dais normally reserved for lawmakers during congressional hearings, according to attendees. Among those who spoke was Rep. Carolyn Maloney (D., N.Y.), a senior Democrat who was negotiating with Mr. Durbin on behalf of the House on the debit-card fee cap. 
 
 Mrs. Maloney said the House would support Mr. Durbin's provision if, among other things, it exempted debit cards used by states to distribute government benefits to the poor. Her position ended up in the law. 
 
 Mrs. Maloney said she met the investors "because many were constituents and it was an opportunity to express my strong support for the financial reforms we were working on." 
 
 SAC Capital Advisors LP was among a group of about 20 hedge funds who attended the series of meetings. The sessions gave clues to the final provisions of the bill, which added to a sharp decline in financial shares. 
 
 SAC cut its holdings in some financial stocks in the second quarter of 2010, which ended two weeks later, and added others, including Bank of America Corp., Citigroup Inc. and Morgan Stanley, according to regulatory filings. 
 
 Mr. Williams also proved himself valuable during the health-care debate. 
 
 A month before his Dec. 8, 2009 meeting with senators, the House had approved legislation requiring the government to create a new public insurance plan for millions of Americans who lacked coverage. 
 
 The health-insurance industry opposed the idea because expanding the government's role could drive down prices. Shares of large national health-care insurers had been languishing over the proposal. 
 
 The outcome was uncertain as the legislation moved to the Senate in December 2009. Several moderate senators were thought to hold the decisive votes on the issue, including Mr. Lieberman and Sen. Ben Nelson (D., Neb.). 
 
 The weekend before the Dec. 8, 2009 session, Senate Majority Leader Harry Reid (D., Nev.) held Senate sessions on Saturday and Sunday, seeking a deal. Another senator, Tom Carper (D., Del.), also was trying to help. 
 
 The central issue: Would the bill call for the government to create a public health insurance plan, the position supported by President Barack Obama? 
 
 To counter Republican opposition, Democrats needed votes from Messrs. Lieberman and Nelson, who said they had major concerns with a robust government-insurance plan. 
 
 As negotiations neared a resolution, JNK Securities and its hedge-fund clients met a half-dozen lawmakers in the U.S. Capitol. Among those who spoke to the hedge funds were Mr. Lieberman and Mr. Carper on Dec. 8, according to their offices. 
 
 The roster included Viking Global's Scott Zinober and Karsch Capital's Eric Potoker. 
 
 The broad outlines of an agreement had been circulating for days, but the lawmakers confirmed they were close to a deal that discarded the public insurance plan, a boost to private insurers. 
 
 Viking, a hedge fund that manages $13.8 billion, bought six million shares of Aetna in that fourth quarter of 2009, according to regulatory filings. Karsch, which manages $2.4 billion, bought half a million Aetna shares during the same period, according to regulatory records. Shares of Aetna rose 14% in the fourth quarter. 
 
 Spokeswoman Whitney Phillips said Mr. Lieberman doesn't "give any special information to one group that he would not share with any other group, constituent or the press." 
 
 Emily Spain, a spokeswoman for Mr. Carper, said that "whether it was in conversations with constituents, members of the business community, public health experts, Congressional colleagues or the media, he regularly discussed his goals for health-care reform legislation." 
 
 That evening, the hedge fund managers retired to a nearby restaurant, Bistro Bis, where they were scheduled to have drinks with Mr. Nelson. 
 
 The senator had to take a rain check. The deal was announced past cocktail hour. 
 
 Write to Brody Mullins at brody.mullins@wsj.com and Susan Pulliam at susan.pulliam@wsj.com ||||| Given his strong condemnations of Wall Street generally and of investor-backed higher education companies in particular, the idea that Sen. Tom Harkin would sit down with a bunch of investors to talk about for-profit higher education -- and that the host investment firm would charge a whopping $10,000 a head for the privilege of meeting the Iowa Democrat -- was more than a little startling. 
 
 Yet that was exactly the tantalizing possibility that one Wall Street firm was dangling in front of its clients last week. "JNK Securities will host Senator Tom Harkin, Chairman of the Health, Education, Labor and Pensions Committee on September 20th at 2:30pm in NYC for a roundtable discussion," one of the firm's managing directors wrote to a group of investors last Friday. "Discussion topics to include for profit higher education institutions and finance." 
 
 When one potential participant wrote to sign up for the event at a French bistro, the JNK official, Don Hood, said in a followup e-mail: "I can confirm you but for our DC Access events such as this we are charging $10k for attendance." 
 
 The suggestion that Harkin would share his thoughts on the for-profit higher education sector with a group of mostly short selling investors -- who benefit when the stocks of the higher education companies go down -- troubled advocates for for-profit colleges. That's especially true given that the senator, by Sept. 20, will have collected much of the mountain of information he has asked the companies to provide as part of his continuing investigation into the colleges' practices -- information that could prove damaging to the colleges. 
 
 "By September 20, Senator Harkin will have all of the internal memos and emails from the top 30 for-profit schools in the country and at that time will be in a unique position to share his thoughts in a manner that could prove actionable for specific JNK clients," Trace Urdan, an analyst at Signal Hill who has strongly criticized Harkin's approach, wrote in a report for clients. "Leaving aside why Senator Harkin would choose to join such an event in the first place and what, in his role as protector of America's student citizens and taxpayers, he believes he can accomplish by dining with a collection of hedge fund managers, we believe the timing is questionable." 
 
 The apparent invitation to join Harkin at Brasserie 8 1/2 seemed to catch the senator's aides by surprise when it was shared with them over the weekend. Tuesday, though, a Harkin spokeswoman told Inside Higher Ed that the senator had never committed to doing such an event -- and that at this point, it was definitely off. 
 
 "The Senator had not -- and would never -- agree to an event as described in emails leaked to the media. That has been made clear to the organization in question," Kate Cyrul, Harkin's communications director, said in a prepared statement. "The first we heard of this kind of event with JNK Securities was through media inquiries. Senator Harkin’s campaign office is planning a fund raising trip to NYC, but at no point had a direct conversation with anyone at JNK Securities." 
 
 A Harkin fund raiser had been approached about the possibility of doing a fund-raising event with some Harkin supporters on Wall Street, Cyrul continued, but "at no point was there discussion of the senator participating in an event focused on any single issue.” 
 
 Hood, of JNK Securities, did not respond to repeated e-mail and telephone messages seeking comment.
– Congressmen aren’t the only ones trading on their inside info. A lucrative practice has sprung up in Washington, in which hedge funds and other investors pay handsomely for private meetings with top lawmakers or their aides, who give them an early scoop on market-moving news, the Wall Street Journal reports. On Dec. 8, 2009, for example, several hedge funds learned of a health care reform deal that would kill the public option—and hence boost shares of private insurers—hours before the public did. That meeting was set up by JNK Securities, which until recently charged clients $10,000 each for such meetings. That ended when Insider Higher Ed confronted Sen. Tom Harkin about one sit-down last year, causing him to cancel; since then, JNK has simply insisted clients trade through it, paying it commissions, if they use info obtained in the meeting. The practice is totally legal, though Rep. Louise Slaughter has sponsored a bill to outlaw it. Some lawmakers back the bill, but others defend the practice, saying they use the meetings to gather insight from investors. Click to read the entire piece.