By Susan Crabtree - 09/16/09 04:00 PM EDT
The Waters probe is just one of three the ethics panel announced Wednesday. The committee also is investigating Reps. Sam Graves (R-Mo.) and Jesse Jackson Jr. (D-Ill.), although it deferred Jackson’s review until the Justice Department conducts its own inquiry.
Waters is a senior member of the Financial Services Committee, which has handled the bulk of oversight of the $700 billion program used to bail out the nation’s troubled banks hit by the financial crisis.
In March, The New York Times reported that Waters helped set up a meeting in which the chief executive of OneUnited, one of the nation’s largest black-owned institutions, asked Treasury officials for up to $50 million in special bailout funds. The story quoted former Treasury officials, who said they were taken aback by the request.
The gathering, with nearly a dozen senior banking regulators, had been convened around the topic of allowing minority-owned banks to discuss the losses they had incurred from the federal takeover of Fannie Mae and Freddie Mac. But the Times reported that Kevin Cohee, OneUnited’s chief executive, used the opportunity to plead for assistance for his bank.
OneUnited eventually received $12 million in bailout funds.
Waters’s husband, Sidney Williams, had served on the bank’s board of directors until early last year and has owned at least $250,000 in stock in the institution.
Waters’s most recent financial disclosure form, which covered 2008, indicates Sidney Williams also has between $350,000 and $750,000 in OneUnited accounts. It is unclear whether the money is invested in stocks or an interest-earning account.
One of the accounts brought in at least $5,000 in interest earnings and the other produced at least $5,000 in dividends, according to financial disclosures. The forms did not indicate that any of the funds were sold or liquidated last year.
OneUnited Bank also did not respond to a request for comment.
The ethics committee said it was deferring the investigation into Jackson’s alleged efforts to win President Barack Obama’s vacated Senate seat while the Justice Department reviews the matter.
The panel had been looking into whether the lawmaker or an emissary offered to raise funds for then-Illinois Gov. Rod Blagojevich (D) in return for the appointment of Jackson to the Illinois Senate seat Obama left behind.
It also unanimously voted to extend an investigation into Graves, the ranking member of the Small Business Committee, and agreed to provide Graves with findings that “may contain exculpatory evidence.”
All three investigations concerned matters referred to the ethics panel by the Office of Congressional Ethics (OCE), an independent review board established last year to help police the House and make recommendations for further action to the full ethics committee.
Once the OCE submits a recommendation, the full ethics committee has 45 days before it must publicize the office’s report and recommendations. The panel may extend that period for 45 days, but it must make the decision public, as it did Wednesday.
In its release concerning Graves, the ethics committee said the OCE had included potentially exculpatory information in the report and findings it forwarded to the ethics panel, but did not provide that information to Graves.
Former Reps. David Skaggs (D-Colo.) and Porter Goss (R-Fla.), the chairman and co-chairman of the OCE, took immediate exception to that suggestion.
“We regret that the Committee on Standards of Official Conduct mischaracterized the Office of Congressional Ethics’ Aug. 6 referral of the matter involving Rep. Sam Graves,” they said in a statement. “The OCE Board did find substantial reason to believe that a substantive violation may have occurred.”
The statement said the complete disclosure of the OCE referral would demonstrate this. It went on to say that the information the ethics committee said “may” be exculpatory was either in Graves’s possession directly or through his counsel or was not pertinent.
“We respectfully note that documents in the referral to the [ethics committee] make this clear,” they said. “The OCE would never withhold exculpatory information from a subject of an investigation and did not in this instance.”
Tensions between the two bodies have been simmering for months.
While the panel did not indicate what it was investigating, earlier this year Graves was accused of potentially violating House rules by inviting an old friend and business partner of Graves’s wife’s to testify at a hearing on renewable fuels without disclosing the potential conflict of interest.
Graves issued a statement Wednesday saying he is looking forward to a “quick review of the facts and answering any questions that the committee may have.”
“I believe that a speedy review will show that all the rules of the House concerning testimony in front of the Small Business Committee were followed,” he said.