Tenacious Defense, Fast Trial Demand

15 August 2010 |permalink | email article

Rep Maxine Waters, Democrat of California, in a testy 90-minute Capitol Hill news conference on Friday contested ethics charges against her, most notably repeating that any appeals she made to Treasury officials in late 2008 were to get minority banks access to decision makers, not to protect a major family investment.

“Neither my staff nor I engaged in any improper behavior, and we did not influence anyone and we did not gain any benefit,” Waters argued, insisting that any federal assistance provided to OneUnited, the Massachusetts bank her husband was once a director, and still owns stock, was based on the merits, not any intervention by her office. A nice try to curry public favor.

The House Ethics Committee has filed three charges against Waters, accusing her office of intervening on behalf of OneUnited at the height of the recession, after it had lost $50 million on an investment it held in Fannie Mae and Freddie Mac, the oddly named federal housing finance agencies.

Waters, in a significant admission, acknowledged that she had called Treasury Secretary Henry M. Paulson Jr. in early September after the agencies were seized by the federal government. She said the urgent request was made on behalf of all minority banks, not just OneUnited, for a meeting to discuss the crisis. The request was granted directly by Paulson after Waters intervened.

The New York Times previously reported that Paulson told investigators Waters did not mention the family ties to the bank, while the ethics committee cited the list of attendees as evidence that the meeting was really set up to benefit OneUnited which three of its top executives attended, and which ethics investigators have charged asked for a special $50 million bailout.

Potentially damaging evidence is that Paulson called Waters after the meeting to express disappointment that more members of the minority banker’s association, given what she described as “a crisis,” did not attend. Three months later OneUnited received $12 million in bailout money.

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