Maxine Waters, the Democrat from California who is the second one facing federal ethics charges in the last couple of weeks has vehemently denied wrongdoing. She said she would rather defend herself at an ethics trial than admit to “something I did not do.”
The House ethics committee on Monday outlined its charges against Rep. Maxine Waters, who is accused of helping a bank in which her husband owned stock secure federal bailout funds.
The committee charged the 10-term California Democrat with three counts of violating House rules and the federal ethics code in connection with her effort to arrange a 2008 meeting between Treasury officials and representatives with OneUnited bank.
The panel said Waters, who sits on the Financial Services Committee, broke a House rule requiring members to behave in a way that reflects “creditably” on the chamber. The committee said that by trying to assist OneUnited, she stood to benefit directly, because her husband owned a sizable amount of stock that would have been “worthless” if the bank failed.
The committee also accused Waters of violating the “spirit” of a House rule prohibiting lawmakers from using their positions for financial gain, as well as a government ethics statute banning the dispensing of “special favors.”
OneUnited asked for $50 million in assistance to cover expected losses from the collapse of the mortgage giants Fannie Mae and Freddie Mac, but Treasury lacked the authority to grant the request, the ethics committee said.
According to the 10-page Statement of Alleged Violation, Waters “did not instruct” her chief of staff, Mikael Moore, to stop assisting OneUnited after she told Financial Services Committee Chairman Barney Frank (D-Mass.) she would halt her outreach.
But Moore, who is Waters’s grandson, contacted OneUnited executives in late September, sending them publicly available draft legislation of a broad Troubled Asset Relief Program (TARP) bill that would have permitted Treasury to buy certain assets of banks.
In October, the legislation authorizing the TARP contained language intended to apply to OneUnited, according to Frank. The bank eventually applied for TARP funds and received $12 million in December.
The panel also reported that Cohee had previously hosted a fundraiser for Waters at his home and that he and his wife contributed to her campaign on “numerous occasions.”
The investigative subcommittee denied two motions filed by Waters: one to provide further clarification of the charges against her and another to dismiss the case.
The fact that her grandson handled the OneUnited matter for her raises even more ethics concerns, watchdogs argue. House rules bar members from hiring for their congressional offices nearly anyone with a family relationship, though not grandchildren.
“Congress has anti-nepotism rules, which sadly don’t rule out members from hiring their grandchildren,” said Melanie Sloan, executive director of Citizens for Responsibility and Ethics in Washington.
Public Citizen’s Craig Holman said, “The family and the business relationship is just so close — it defies credibility that he would be acting on his own without her knowledge.”
Waters plans a vigorous defense this week.