Congresswoman denies bank bailout charge

California Representative Maxine Waters faces heat from the House Ethics Committee regarding her involvement in a 2008 meeting which paved the way for the bank OneUnited to receive $12 million in Troubled Asset Relief Program (TARP) money. Waters’ husband, Sidney Williams, is a former director of the bank and was on its board at the time of the government negotiations. Williams owns stock in the corporation, and the stock value of Wiliams’ investments dropped far below half of what he had invested prior to the government intervention.

The bank in question, Boston-based OneUnited, was deeply invest in Freddie Mac and Fannie Mae when the institutions crumbled in 2008, eliminating $50 million of the bank’s capital. OneUnited was taken over by the federal government as one of hundreds of minority-owned banks following the crash. Representative Waters submitted a request to then Department of Treasury Secretary Henry Paulson to meet with members of over 100 minority owned banks so those institutions could request bailout funds. Even though Waters claims that the meeting was intended for Paulson to help all of the minority-owned banks, the majority of the meeting attendees were from OneUnited. During the meeting, OneUnited made a request for $50 million in TARP money, an amount much higher than anticipated. Paulson later contacted Waters to complain.

Waters held a press conference on Capitol Hill to address the rumors on Friday. “If someone is accused and simply goes into the back room and agrees to some violation even if they are not guilty of it, it would avoid all of the public press, it would be easy on the committee itself.  That is how it normally works. But we feel very strongly we cannot do that.”  Ms. Waters  said, referring to her interaction with the House ethics committee.