Rep. Waters formally cleared by Ethics panel

The House Ethics Committee on Tuesday officially cleared Rep. Maxine Waters of all ethics charges after nearly three years of investigating the California Democrat.

Members of the panel handed the lawmaker a gigantic victory by voting unanimously to find her not guilty of allegations that she tried to secure federal money during the financial crisis for a bank in which her husband owned stock.
“It appears that Rep. Waters recognized and made efforts to avoid a conflict of interest with respect to OneUnited,” the committee said on Tuesday.
The long-awaited decision all but guarantees that Waters will take over next year as the senior Democrat on the House Financial Services Committee. Rep. Barney Frank (Mass.), who has been the leading Democrat there, is retiring and no other Democrat has moved to oppose Waters.
The announcement came in tandem with a series of nine recommendations that rebuff the committee for acting improperly and set out to reform the secretive ethics panel’s rules and practices.
The recommendations were issued by the temporary committee — “the Waters Committee” — that was established earlier this year to finish investigating the lawmaker after six members of the original panel recused themselves and an outside counsel was hired to investigate the original committee members and staff for political bias and corruption.
In its findings, panel members should “constantly evaluate their actions on the committee” and the actions of the staff to ensure they are not acting in a partisan way, advised the Waters Committee on Tuesday.
“If committee members find that distrust is arising along party lines with respect to particular staff members, that distrust should raise a red flag,” the committee’s report stated.
“At the point the committee’s leadership or staff become aware of insensitive or inappropriate comments related to bias, it is incumbent on them to deal with such allegations in an open, frank, and bipartisan or nonpartisan manner.”
Waters has maintained her innocence all along and balked at the abnormal length of the ethics ordeal, which began in 2009 when the Ethics Committee accepting the Office of Congressional Ethics’ (OCE) referral to investigate the matter further.
The Ethics panel moved to hold a hearing for Waters in late 2010. But before the hearing began, the committee halted its work abruptly and placed two of its lead attorneys on administrative leave. Shortly afterward, the committee’s chief counsel stepped down.

The first half of 2011 was spent in a flurry of firing and reorganizing among the panel’s investigative and legal staff, which included the hiring of a new chief counsel.

Charges of improprieties led the panel to hire outside counsel Billy Martin, who after a yearlong, nearly $1 million investigation found the committee acted fairly and that Waters’s rights had not been violated.


The committee on Tuesday came down hard on Waters’s chief of staff and grandson, Mikael Moore, issuing the staff member a letter of reproval. The panel stated that he knew, or should have known, that actions he took to assist OneUnited Bank, after being told by his boss not to, would benefit Waters’s husband, who owned $350,000 in stock in the minority-owned bank.  

The letter, issued on Tuesday, was unanimously approved by the committee and found Moore guilty of using his office for personal gain, dispensing favors and bringing discredit against the House.

Tuesday’s announcement comes after the Ethics panel held a rare public hearing for Moore last Friday. Committee members Bob GoodlatteRobert (Bob) William GoodlatteThe job of shielding journalists is not finished Bottom line No documents? Hoping for legalization? Be wary of Joe Biden MORE (R-Va.), Steven LaTourette (R-Ohio) and Donna Edwards (D-Md.) grilled Moore for three hours about whether he went against Waters’s request not to take any action on behalf of OneUnited Bank because of the potential conflict of interest.

Goodlatte, who was the chairman of the Waters Committee, stated that he was open to being persuaded by Moore of his innocence during the hearing.

At the center of the committee’s charges against Moore are two emails, one of which indicated to a House Financial Services Committee staffer that OneUnited Bank was on the verge of failing if it did not receive federal bailout money contained within the Troubled Asset Relief Program. The committee contends that the email is evidence of Moore using his position to advocate on behalf of the bank, in which his grandfather owned stock in.

Waters told Moore not to take any action to help OneUnited Bank specifically because of the potential appearance of a conflict of interest. But Martin’s report was unable to firmly determine when Waters told Moore this. On Friday, Moore argued in part that because the committee couldn’t nail down when he was told not to interfere, he may have taken the actions he’s accused of without knowing that Waters wanted him to refrain.
On Tuesday the committee rejected Moore’s defense while also going against Martin’s outside report for the committee, which found a lack of evidence to confirm, without a doubt, that Waters had told Moore to stay out of UnitedOne Bank’s affairs before he sent the e-mails.
“Outside counsel recognized the evidence suggesting that [Moore] knew or should have known of Representative Waters' financial interest in OneUnited, but recommended that the record, standing alone, did not establish that conclusion to a clear and convincing standard,” the committee’s report states.
“Outside Counsel thus deferred to the Waters Committee to weigh the credibility of [Moore's] claimed ignorance of Representative Waters' financial interest in OneUnited, in light of the evidence to the contrary.”
In finding Moore guilty of violating House rules, the Waters Committee cited testimony that Waters gave the committee’s investigators stating that, as her chief of staff, Moore would have known about the potential conflict of interest.
“He would have known that my husband was invested in OneUnited,” Waters told the committee, according to its report. “The public knows, everybody knows. The newspapers knew. My financial disclosure papers were available to everybody.”

Updated at 2:26 p.m.