WASHINGTON — A recently discovered e-mail, which forced postponement of Rep. Maxine Waters' ethics trial, appears to bring the House ethics committee no closer to proving she tried to obtain a U.S. bailout – during the financial crisis – for a bank where her husband owns stock.
Waters, a California Democrat and a senior member of the House Financial Services Committee, was to go on trial Monday before an ethics panel of eight congressional colleagues. She has maintained her innocence, and has been demanding for months that the trial be held.
The new evidence is an e-mail written by her chief of staff Mikael Moore, who also is Waters' grandson. It said Waters was closely watching the writing of bailout legislation that included a provision to help minority-owned banks. But OneUnited Bank – where Waters' husband is a stockholder – wasn't mentioned, even though it was among the institutions that could have benefited from the provision.
A key question is whether Waters instructed Moore to get assistance for OneUnited, when her husband's investment in the Boston-based institution was in danger of becoming worthless during the near-financial collapse of late 2008.
Waters has contended she was simply trying to help all minority banks in trouble – and specifically those, like OneUnited, that were hurt by their investments in the then-collapsing mortgage giants Fannie Mae and Freddie Mac.
In its public document that charged Waters earlier this year with three ethics violations, and now in the staff chief's e-mail, the ethics committee has so far failed to establish that Waters' efforts were for OneUnited rather than a larger group of banks.
Ethics trials are rare. Last week, the ethics committee recommended that the House publicly censure 20-term Rep. Charles Rangel of New York for fundraising and financial conduct that violated congressional rules. It was only the second House trial proceeding in the past two decades.
The chief of staff's e-mail was written by Moore on Sept. 28, 2008, to Financial Services Committee aides writing what became the Bush administration's controversial $700 billion TARP – Troubled Asset Relief Program – bailout for banks, insurance companies, auto companies and other financial institutions
Moore's memo was general rather than specific, saying the congresswoman was "under the explicit impression" that provisions affecting small and minority-owned banks were still in the bailout bill.
"If there is any material or technical changes to the language as last agreed upon, please alert me as soon as possible so that Rep. Waters has an opportunity to weigh in," Moore wrote.
OneUnited did end up receiving $12 million in bailout money, in December 2008. But Treasury Department officials have told House investigators that Waters was not involved in that decision.
House investigators have not revealed a direct link between Waters' conduct and the dispatch of bailout funds to OneUnited. And the ethics committee's case is not helped by survey responses from 28 banks which said they were in similar circumstances as OneUnited.
The survey was conducted by the Independent Community Bankers of America, which represents smaller banks across the country. The banks responding to the survey are institutions that could have benefited from the provision that Waters – according to her chief of staff's e-mail – was closely monitoring in the writing of the bailout bill.
Paul Merski, chief economist for the independent bankers, said the real number of banks in similar circumstances could be as high as 300, because only a fraction of the group's members responded.
"This was for more banks than just one bank," he said in an interview.
Rep. Barney Frank, D-Mass., chairman of the Financial Services Committee, said in an interview that he inserted the provision for minority banks to protect OneUnited – because it is based in his state.
But he said of Waters, "I did not know she was watching" the drafting of the section. "We never discussed it," he said. "I heard from people in Massachusetts."
The provision sought by Waters – and inserted by Frank – told the Treasury Department that it should consider – for bailout money – banks that had an asset size of $1 billion or less, and whose size dropped to a lower range because they owned devalued, preferred stock in Fannie Mae and Freddie Mac.
Asset size is the total dollar amount of everything a bank owns or controls, including loans, real estate holdings, securities and office equipment.
Another difficulty in proving the violations: the provision by itself did not qualify any bank for bailout money.
All banks applying for bailout funds had to meet a number of Treasury thresholds to get the assistance. The Fannie-Freddie section merely instructed Treasury not to overlook banks that lost money due to their investments in the mortgage companies. Both Fannie Mae and Freddie Mac were taken over by the government.
Waters has acknowledged that in early September 2008, she asked then-Treasury Secretary Henry Paulson to arrange a meeting between Treasury officials and a trade group of minority-owned banks. The purpose was to assist institutions harmed by the devalued Fannie and Freddie stock, she said.
While Waters did not attend, the two representatives of the National Bankers Association at the meeting were OneUnited's chief executive officer and its senior counsel – who also was chairman-elect of the association. No other bank was represented.
Waters has contended that she was acting solely on the request of the association, and argued that she never made any request to Paulson on what should be done.
According to the ethics committee charges, Waters' husband, Sidney Williams, had an investment in OneUnited that was valued at more than $351,000 on June 20, 2008. It had dwindled to $175,000 by Sept. 30, 2008, the time period when Waters was monitoring the TARP legislation.
If OneUnited had not received federal financial help, the charges said, the investment could have become worthless.
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What do you get when you combine affirmative action with corrupt no-bid military industrial complex gubmint cheese?
Sean_6399: What do you get when you combine affirmative action with
http://www.huffingtonpost.com/social/Sean_6399/army-awards-250-million-c_n_788536_68721233.html
Permalink ?| Share itHardly unique. The ill advised attempts by federal, state and local government to divert business to minority, women, and small business firms has resulted in the creation of pass thru entities where a person who meets the requirements skims money and the government gets it's political quota. Standard governmental nonsense.
Skeptical_Patriot: Hardly unique. The ill advised attempts by federal, state and
http://www.huffingtonpost.com/social/Skeptical_Patriot/army-awards-250-million-c_n_788536_68721228.html
Permalink ?| Share itAlaska has a budget surplus according to Sarah Palin, other states (primarily California and New York) do not need to be giving it more money, they have their own money. And doesn't Palin get her government healthcare through her husband being an Alaska native?
brklynivn: Alaska has a budget surplus according to Sarah Palin, other
http://www.huffingtonpost.com/social/brklynivn/army-awards-250-million-c_n_788536_68721161.html
Permalink ?| Share itWell there you have it. Now gov't incompetence, fraud and waste is ... "God's will".
cyoohoos: "I am very proud of what we have accomplished. All
http://www.huffingtonpost.com/social/cyoohoos/army-awards-250-million-c_n_788536_68720944.html
Permalink ?| Share itWe always joke that a company owned by a female, blind, disabled veteran Native American is the gold standard for getting a US Government contract. Under the current administration, if the female owner prefers the company of other women, that's even better.
gman87: We always joke that a company owned by a female,
http://www.huffingtonpost.com/social/gman87/army-awards-250-million-c_n_788536_68720909.html
Permalink ?| Share itWe always joke? Who is we, that's really a pathetic statement.
observingstupiditydaily: We always joke? Who is we, that's really a pathetic
http://www.huffingtonpost.com/social/observingstupiditydaily/army-awards-250-million-c_n_788536_68721039.html
Permalink ?| Share itAnd it was proven that under the former administration, all you needed was to be connected to the vice President... Haliburton (cough cough)....[rolling eyes]
Toddynho: And it was proven that under the former administration, all
http://www.huffingtonpost.com/social/Toddynho/army-awards-250-million-c_n_788536_68721132.html
Permalink ?| Share itShould they have waited months for three already rich and bloated firms to try and out bid one another?
Toddynho: Was the job done well? If so, it sounds like
http://www.huffingtonpost.com/social/Toddynho/army-awards-250-million-c_n_788536_68720800.html
Permalink ?| Share itThe job was done, but at what cost? For all we know, the $$250 million dollar contract could have been worth half that allowing this "alaska native" to pocket half the money it received. There is a reason contracts are no bid, and it's not because people are interested in keeping their profit margin at 6%.
cyoohoos: The job was done, but at what cost? For all
http://www.huffingtonpost.com/social/cyoohoos/army-awards-250-million-c_n_788536_68720976.html
Permalink ?| Share itAgain, if the job was done and everyone was happy, what's the beef? Seems like all parties are happy, no one is accusing this "Alaskan native" (your quotations) of any wrong doing. Why presume there was some?
Toddynho: "For all we know?": I'll need to go on a
http://www.huffingtonpost.com/social/Toddynho/army-awards-250-million-c_n_788536_68721094.html
Permalink ?| Share itHUFFPOST SUPER USER
tinyrainbows ? 39 minutes ago (5:45 AM)I've been in Iraq for five years. I've seen all branches of the military piss away real money.
tinyrainbows: I've been in Iraq for five years. I've seen all
http://www.huffingtonpost.com/social/tinyrainbows/army-awards-250-million-c_n_788536_68720735.html
Permalink ?| Share itThis Alaska Native contracting has long been known in the military as a strong mechanism for contractor "empowerment", just this side, and sometimes over, the line of fraud, waste and abuse. It's widely used by military contracting companies throughout CONUS, outside of Alaska. Contracting companies often identify themselves as Alaska Native companies on their letterhead.
agxphoto: This Alaska Native contracting has long been known in the
http://www.huffingtonpost.com/social/agxphoto/army-awards-250-million-c_n_788536_68719866.html
Permalink ?| Share itBut gay service people threaten the US military?????
maveet: "In summer 2008, the U.S. military had a major problem.
http://www.huffingtonpost.com/social/maveet/army-awards-250-million-c_n_788536_68719465.html
Permalink ?| Share itHUFFPOST SUPER USER
tinyrainbows ? 37 minutes ago (5:47 AM)maybe they were gay assaults. The article didn't say.
tinyrainbows: maybe they were gay assaults. The article didn't say.
http://www.huffingtonpost.com/social/tinyrainbows/army-awards-250-million-c_n_788536_68720758.html
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