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Maxine Waters Is Second Democrat Headed for Trial on Ethics Charges

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Things went from bad to worse for Democrats in Congress on Monday when the House ethics committee officially announced that Rep. Maxine Waters, a senior California Democrat, is headed to a public trial on charges that she violated House ethics rules. Waters is accused of intervening with federal regulators on behalf of a bank in which she and her husband had substantial investments, and where her husband once served on the board of directors.

Waters is the second senior Democrat in as many weeks to be slated for a rare public hearing before the committee. On Thursday, Rep. Charlie Rangel was formally charged with 13 violations of House rules.

By transmitting a "statement of alleged violation," the ethics committee is ending the investigative phase of the Waters matter and moving to the adjudicatory phase. Taking this crucial step signals that the committee has "substantial reason to believe" that Waters broke the official rules of the House.

Maxine WatersWaters issued a defiant statement in response to the committee's decision, vowing to take the matter to a public trial.

"I have not violated any House rules," Waters said. "Therefore, I simply will not be forced to admit to something I did not do."

In addition to the committee's announcement, Reps. Zoe Lofgren (D-Calif.) and Jo Bonner (R-Ala.), the chairwoman and ranking member of the ethics committee, also released a lengthy report summarizing the conflict-of-interest charges against Waters.

The committee report details a 2008 phone call, in which Waters phoned then-Treasury Secretary Henry Paulson to arrange a meeting between Treasury officials and the National Bankers Association to discuss the effects on minority-owned banks from the federal takeover of Fannie Mae and Freddie Mac.

The chairman-elect of the National Bankers Association, Robert Cooper, asked Waters to place the call and attended the meeting. In addition to his role with the Bankers Association, Cooper was also the vice president and senior counsel for OneUnited Bank, where Waters had personal connections. When the meeting occurred, witnesses who attended reported that the only bank discussed was OneUnited.

Waters' husband, former NFL linebacker Sidney Williams, was on the board of directors of OneUnited Bank and had between $500,000 and $1 million in investments there, according to the congresswoman's financial disclosure reports. The bank still features a photograph of the congresswoman on its website.

In the committee report, a member of Congress, who is not identified, tells investigators that OneUnited was heavily invested in preferred stock of both Fannie Mae and Freddie Mac, and its leadership feared it was on the brink of collapse in 2008.

The same member of Congress also said that Waters had confided that she was unsure of how to deal with the OneUnited situation "because Sidney's been on the board." The member of Congress advised Waters, "Stay out of it."

As senior member of the House Financial Services Committee, Waters would have had significant clout with the Treasury officials at the meeting, as well as with officials who were doling out money from the Troubled Asset Relief Program, which OneUnited also applied for. OneUnited later received $12 million in bailout money.

Waters has represented her South Central Los Angeles district in Congress for 20 years. Her official House website describes the congresswoman as "considered by many to be one of the most powerful women in American politics today."
Filed Under: The Capitolist

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317 Comments

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oldengineera2

Congresswoman Waters' recorded comments on other representatives' previous errors should prove remarkably tasty fare for those with an appreciation for the ironic and the darkly just. "Sauce for the goose" indeed...

August 03 2010 at 10:55 PM Report abuse +8 rate up rate down Reply
anthomerritt

Waters broke the official rules of the House.

August 03 2010 at 6:04 PM Report abuse +10 rate up rate down Reply
mmlowe

HOW many small banks are in her district?
How many black banks are in her district?
How many black banks are there to invest in her district.
How many black banks are there to invest in the USA.
HENRY PAULSON served as CEO of what BANK, and he is in charge
of the Whole bailout system which saved what bank, to the tune
of how much.
So 12 million may be attributed to Maxine Water's pet bank.
And ?? billion may be attributed to Henry Paulson's former bank.

August 03 2010 at 2:31 PM Report abuse rate up rate down Reply
carolyn

At least Demorcrats are trying to clean up Washington and are not afraid to go after their own. Bottom line right is right and wrong is wrong. At least Demorcrats are trying to bring moral, ethical, integrity, and high standards back. Unlike Republicans who stand behind any crookedness in your party, ignore any coruption the their people do, claiming to be the Christian conservative Right (In the Name of Jesus) and have people like (Mark Stanford) and so many more scandels that have rocked this nation. But have the BLATENT NERVE to think that people want you to be the party of the future. WoW, I love Hyprocrits! Democrats on the hill, congradulations and keep on standing for whats right because, in the end that will surely win and America will begin to be the country that the rest of the world loves and God smiles on again. Good for those who will not put up with unethical behavior even though some of it is from your own party. ITS CALLED TAKING RESPONSIBILITY!

My organization is watching all who take the front row and begin to do whats right in America. Democrats you may have more support in the fall then you think. Especially from this organization the houses members over 65,000. We need ethical people to stand up. We will be watching.

God Bless!

August 03 2010 at 2:09 PM Report abuse -18 rate up rate down Reply
1 reply to carolyn's comment
klongar3

They suddenly get religion on their death bed LOL. they didn't risk a vote when they needed their majority now they make a fig leaf to hide behind by taking out Rangel and Waters. why does it take 18 months to investigate the allegations?
The answer......political expediency.

August 09 2010 at 2:28 PM Report abuse +1 rate up rate down Reply
fresherdata

Another example of the "liberal press" spattering innuendo all across the land in regards to democrats. Think about the year long reporting of clintons misearable affair and the slight blip of Larry the Bathroom guy or tom delays absolutely evil support of South Pacific Sweat Shops and enron ties. Didn't hear about that? That's the liberal press in action. If it crosses the republican party it gets pulled after an hour. You have to be really fast.

August 03 2010 at 1:40 PM Report abuse -6 rate up rate down Reply
1 reply to fresherdata's comment
Ed

Ah, I thinkg you have your parties mixed up here. Please!!!!!

August 03 2010 at 1:52 PM Report abuse +8 rate up rate down Reply
utig1

Wasn't it Nancy Pelosi who said that this would be "the most ethical Congress in history " and she would " drain the swamp" ". GOOD JOB, Nancy ....LOL...

August 03 2010 at 1:03 PM Report abuse +14 rate up rate down Reply
dc walker

Amricans, tired of hearing corruption in the Congress?? You can do something about it in November. Send a message to all wanting higher office, keep your nose clean, read the bills before signing or out you go.

August 03 2010 at 1:03 PM Report abuse +11 rate up rate down Reply
Sonny

I remember Maxine Waters lying about Fannie Mae & Freddie Mac being sound and there was know problems with either agency. Plus Franklin Raines was doing an out standing job. Once the failure started and all the infomation was known Franklin Raines had received millions of dollar and Water's husband was CEO/President of the one of the bank that collapse due to the failure of the housing market. She just as much of a crook as Dodd and Franks.

August 02 2010 at 10:00 PM Report abuse +98 rate up rate down Reply
grassyno

This is precisely the type of thing liberal Democrats have been doing since 1998 that caused the housing bubble and subsequent collapse (and the current recession). They've been pressuring banks behind the scenes to make loans to poor and minority types who don't pay back the money, then bail out the banks with Fanny and Freddy (government) money. (Janet Reno stepped up the process in 1998 under Clinton.) Then Obama has the "audacity of hope" to tell voters the problem was "too little regulation and too much wall street greed". Unfortunately for liberals, the record shows it was too many regulations forcing charity by banks (at the expense of taxpayers) that led to the housing crises, and the recent bank regulation bill does NOTHING to alter Fanny Mae or Freddy Mac. That's change we can NOT believe in.

August 02 2010 at 9:55 PM Report abuse +93 rate up rate down Reply
1 reply to grassyno's comment
mmlowe

Do yourself a favor and dig deeper into the numbers here.
Paulson & Geithner's banks got how much money.
AIG got how much money.
"Charity" by banks.
You compare Millions to Billions.
A million is 1/1000 of a billion, do the math.
De-regulation hit the banking sector in 1986. Prior to that
they had specifics they could not do, since, it has gone to
crap. The partisanshp is NOT helping the USA. Unless we
figure out how to restore the world market's faith in the
dollar, we have issues heading our way trumping anything we
have seen.

August 03 2010 at 2:36 PM Report abuse +5 rate up rate down Reply
duster2143

She is as guilty as any of the Criminals {opps, politician or is that prostitute!!} in Washington!!! The punishment for her crime will unfortunately most likely not be much and that is a disusting abuse of power!!!! Hey Pelosi, how about playing the pied piper and lead all the rats out of the swamp along with yourself!!!!

August 02 2010 at 9:53 PM Report abuse +88 rate up rate down Reply

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