Waters mounts vigorous defense

During an unusually long session with reporters Friday, Rep. Maxine Waters mounted a vigorous defense against charges she broke House ethics rules.

During the 90-minute morning press conference, Waters denied she violated House rules and called for her public ethics trial to begin as quickly as possible so she can refute charges that she used her position to help a bank in which her husband owns stock.

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“No government agency or their representatives have ever said that I requested any special assistance or compensation for anyone or any institution,” Waters said. “No benefit, no improper action, no failure to disclose, no one influenced. No case.”

The 10-term California Democrat laid out her defense using a PowerPoint presentation from her chief of staff. She insisted she did not take action to benefit OneUnited bank, where her husband is invested and was formerly a board member.

Waters admitted that she arranged a meeting between Treasury officials and the National Bankers Association (NBA), a trade association that represents 140 minority-owned banks, including OneUnited. But she said she would “never take extraordinary steps” to protect her husband’s investments.

Waters said her only motivation for setting up the Treasury meeting was helping minority banks, an issue on which she has long been active. In the Wall Street reform bill, for example, Waters added several provisions to protect women and minorities.

"Neither my staff nor I engaged in any improper behavior; we did not influence anyone; and we did not gain any benefit," Waters said. "This case is not just about me. This case is about access, about access to those who are not heard by people in power."

Waters did not attend the Treasury/NBA meeting in early September 2008, but her chief of staff and grandson, Mikael Moore, was present, along with staffers for Rep. Barney Frank (D-Mass.) and Sen. John Kerry (D-Mass.).

The House ethics committee alleges that the meeting at Treasury was focused solely on OneUnited’s problems but dressed up to look like a meeting on the challenges facing minority banks during the financial crisis. OneUnited officials were the only bankers at the meeting.

Waters pointed out that OneUnited executive Robert Cooper was the NBA’s chairman-elect at the time of the Sept. 9, 2008, meeting, and noted that small trade associations don’t take all of their members to meetings in D.C.

Waters also said she had no role in OneUnited’s eventual receipt of more than $12 million from the Troubled Asset Relief Program (TARP).

The congresswoman’s husband served on OneUnited’s board of directors and initially invested $350,000 in the bank’s stock. The ethics committee report said the value of the stock had dropped to $175,000 by the fall of 2008 and could have been wiped out completely had the bank not received TARP funds.

Waters joked that her husband still owns the OneUnited stock “because no one wants to buy it.”

In her opening statement Friday, Waters rarely veered off-script, in contrast to her colleague, Rep. Charles Rangel (D-N.Y.), who also faces an ethics trial for allegedly violating 13 House ethics rules. Rangel defended himself three times this week, often speaking extemporaneously.

Waters said that she did not discuss the decision to hold her press conference with House leadership. Top Democrats were reportedly upset with Rangel's decision to deliver a freewheeling defense Tuesday on the House floor.

The veteran lawmaker downplayed the possibility that her ethics trial, which could happen around the same time as Rangel's, will hurt Democrats in the November midterm elections.

“As far as I am concerned, most of it is speculation. Each member has to be concerned that they are representing their constituents — that they are doing the best job they can do … [and] that they are honoring the law and living by the law.”

Waters said that she would not address issues of race, even though she has previously mentioned it as playing a role in the ethics investigations.

"I will not be taking questions about the supposed issue of race in this matter," she said.

She also refused to discuss Rangel's case during the question-and-answer session with reporters.

The ethics panel pointed to e-mails between Moore, Waters's chief of staff, and OneUnited officials as evidence that her office worked to secure TARP funds for the bank.

Waters and Moore both argued that the meeting occurred before TARP existed and said they backed off from helping OneUnited when the issue of TARP came to the fore. At that point, Waters said, she talked to Frank and told him about OneUnited’s issues as well as her husband’s former position on its board. Frank told her to hand the issue over for him to handle, and Waters and Moore said that’s just what they did.

Moore said the e-mails he exchanged with OneUnited officials in late September do not indicate he was trying to help them secure TARP funds. He said an e-mail he sent to OneUnited contained a publicly available draft of the TARP legislation, not language drafted specifically to help the bank.

Moore pointed to an e-mail he received from Neel Kashkari, who at the time in question was the assistant Treasury secretary in charge of the Office of Financial Stability, which was established to buy troubled financial assets under TARP.

In the e-mail, Kashkari said the Sept. 9 meeting between OneUnited executives and Treasury officials did not in any way influence his decision to award the bank $12 million in federal funds.

Waters and Moore also disputed a claim by the ethics committee that Frank warned them to stay away from the OneUnited issue in early September. They said the Frank warning did not come until the end of September, which would explain Moore’s continued e-mail correspondence with bank officials that month.

Some of the most heated moments at the Waters event came in response to reporters’ questions about the checkered history of OneUnited and its president, Kevin Cohee, who was arrested on sexual assault and drug charges. Waters has previously called Cohee a personal friend and acknowledged he once held a fundraiser for her.

While Waters would not address Cohee’s arrest record, she maintained she had no knowledge of OneUnited’s lax lending practices or the allocation of funds for Cohee’s two luxury homes and Porsche. Just before the fall of 2008, the FDIC issued a cease-and-desist order against OneUnited and threatened to take away its license.

Members of Congress, Waters said, depend on regulatory agencies to investigate and ferret out bad practices in financial institutions.

Waters attacked the House’s ethics process and called for a full discussion of the practices of the ethics committee and relatively new Office of Congressional Ethics (OCE). She mentioned support for a bill sponsored by Rep. Marcia Fudge (D-Ohio) that would strip the new entity of some of its powers.

“I just think it should be improved,” she said. “I think there must be due process.”

She also falsely accused the OCE of being able to release its reports at any time — even close to a member’s reelection. In fact, the ethics committee is the only entity that can release the OCE’s reports; until that time, they remain confidential. The OCE submitted Waters’s referral to the ethics committee in August 2009.

The OCE, which was created by Democrats after they won the majority in 2006 campaigning on Republican ethics woes, is an independent body made up mainly of former members that makes recommendations to the full ethics committee.