This was very odd to us, since our names wouldn't mean a thing to anyone on the client's end, but we chalked it up to red tape. Your explanation finally makes sense of it.
At most, it gets the A-team's PE stamps, so they're at least professionally liable for the quality of work, but first project coordination/ outline meeting & final review are all they usually do. Occasionally take a call from a VIP.
And when the project freezes indefinitely, so do the payouts.
I asked why they were doing it, but no one gave me a straight answer. I mean, I get for them it was Tuesday, but when a major contractor starts asking you to brush right up against the line of equivocating, I can't justify moving forward without some serious explanations and levels of frankness I don't think many recruiters are comfortable with..
After my first successful project for them, their biggest client started demanding that I be assigned to their next big project (or one of the external contractors). We both ended up taking jobs elsewhere, and that client quit using the developer.
And the client? They were a full-on shovel-ware developer that barely cared about game quality. They just needed a game that would run reliably enough that Nintendo would approve it. So to be fired as a developer by that company was really embarrassing...