Last year Representative Rep. Maxine Waters (D-CA) landed on Judicial Watch’s “Washington’s Ten Most Wanted Corrupt Politicians,” and for good reason. Waters (and her partner in crime, Rep. Barney Frank (D-MA)) helped secure a TARP grant for the failing Massachusetts bank OneUnited — a bank in which her husband had a significant investment. (Michelle Malkin reports that Waters’ husband, Sidney Williams held a $350,000 stake in OneUnited as recently as June 2008.)
Could the conflict of interest be any more egregious?
We didn’t think so. And for a while it appeared the House Committee on Standards of Official Conduct (a.k.a. The House Ethics Committee) agreed. The Committee announced last fall there would be a speedy trial to consider the charges against Waters. And, on the heels of the massive investigation and very public trial of Rep. Charles Rangel (D-NY), there was reason to be somewhat optimistic that Waters would be held accountable.
That is until House Ethics Committee Chairman Rep. Zoe Lofgren (D-CA) started meddling in the process. Not only did Lofgren fail to issue subpoenas for records related to the scandal, but she also delayed the ethics committee hearing after doing everything in her power to undermine the professional committee staff leading the investigation. And, as if that were not enough, Lofgren then improperly fired two attorneys working on the investigation.
Now the Waters investigation is stuck in the mud.
A spokesman for House Ethics Committee Chairman Rep. Joe Bonner (R-AL), who has slammed Lofgren on more than one occasion for mishandling the investigation, declined to comment on when a hearing would be rescheduled. (It looks to me as if Lofgren was trying to help Waters co-conspirator Barney Frank as much as Waters.)
Meanwhile, The Washington Post recently highlighted documents from the FDIC that provide new details on something Judicial Watch reported last year — OneUnited Bank was in deplorable financial shape at the time of the TARP grant (partially because of a questionable $50 million investment in the sinking ship that was Fannie Mae and Freddie Mac), and would never have received government assistance without the intervention of Waters and Frank:
A decision in late 2008 by top officials of the Federal Deposit Insurance Corp. to help a politically connected bank in Boston left federal bank examiners there angry enough that some called it a “travesty of justice,” according to internal e-mails obtained by The Washington Post.
The chairman of OneUnited Bank, a friend of Rep. Maxine Waters (D-CA) (D-Calif.), had rendered it insolvent through lavish spending and bad investments, according to the examiners’ written accounts. But by the end of that year, after Waters arranged a key Treasury Department meeting for the bank, it had won a bailout loan and a unique exemption from the FDIC’s accounting rules.
“There are some really good people expressing very strong opinions regarding what they view as a travesty of justice regarding the special treatment this institution is receiving,” acting regional director John M. Lane warned in a March 2009 e-mail to Christopher J. Spoth, a senior FDIC consumer protection official.
(As reported in the January 22, 2009, edition of the Wall Street Journal, the Treasury Department indicated it would only provide bailout funds to healthy banks to jump-start lending.)
A travesty of justice. That’s a perfect description not only for the OneUnited cash infusion, but also the manner in which the Waters House ethics “investigation” has “proceeded.”
Judicial Watch has been on top of the OneUnited scandal ever since it first broke. In fact, we sued the Treasury Department for documents and unearthed some remarkable finds that implicate both Frank and Waters. For example, JW learned that the unnamed “federal regulator” Frank says he called regarding the $12 million TARP grant for OneUnited was none other than former Treasury Secretary Henry “Hank” Paulson.
And then there was this explosive January 13, 2009, email from Brookly McLaughlin, the Treasury Department’s Deputy Assistant Secretary for Public Affairs, who expressed shock at Waters’ apparent conflict of interest regarding OneUnited:
Further to email below, WSJ [Wall Street Journal] tells me: …Apparently this bank is the only one that has gotten money through section 103-6 of the EESA law. And Rep. Maxine Waters (D-CA)’ husband is on the board of the bank. ??????
So, in sum, the House Ethics Committee has all the evidence it needs to hold Maxine Waters to account on the OneUnited scandal. But Waters allies are corrupting the Ethics Committee at this point. I might suggest that the new Republican leadership clean up this mess. Frankly, the longer it goes on, the easier it is to conclude that the Republicans running the House aren’t bothered by a dysfunctional Ethics Committee.