As Rep. Maxine Waters was warned against interceding on behalf of a bank with ties to her husband, her chief of staff, who is also her grandson, was "actively involved" in working to help the institution, according to a House Ethics Committee report released Monday that accuses the longtime Los Angeles political figure of three ethics violations.
Waters was accused of violating three rules — one that requires its members to "behave at all times in a manner that shall reflect creditably on the House," a second that prohibits lawmakers from using their influence for personal benefit and a third forbidding the dispensing of favors.
The Democratic congresswoman has vowed to fight the charges in a trial before fellow House members, contending that her efforts were in keeping with her longtime work to promote opportunity for minority-owned businesses and lending in underserved communities such as her South Los Angeles district.
The 10-page statement of alleged violations and other documents released Monday provide more details than the findings of the Office of Congressional Ethics made public last week.
The documents contend that Waters' chief of staff, Mikael Moore, worked to help OneUnited Bank, even as Rep. Barney Frank (D-Mass.), chairman of the House Financial Services Committee, urged Waters to "stay out of it" because of her husband's ties to the bank.
OneUnited received $12 million in federal bailout funds in December 2008. Waters' husband, Sidney Williams, served on the OneUnited board from January 2004 to April 2008, and owned stock in the bank when Waters set up a September 2008 meeting between Treasury Department officials and representatives of minority-owned banks.
The case against Waters, a fiery 71-year-old liberal who won election to the state Assembly in 1976 and to Congress in 1990, comes as Rep. Charles B. Rangel (D-N.Y.), another prominent Congressional Black Caucus member, faces an ethics trial in the weeks before what is shaping up as a tough midterm election for Democrats.
Unless Waters settles, an eight-member panel of her House colleagues, evenly divided between Democrats and Republicans, will hear the case against her.
The statement of alleged violations noted that Waters' husband's stock in OneUnited, worth about $350,000 in June 2008, dropped to half its value in September 2008. If OneUnited had not received the aid from the Troubled Asset Relief Program, her husband's financial interest in the bank would have been worthless, the statement said.
Once Waters realized that she should not be involved in assisting OneUnited, she should have instructed her chief of staff to refrain from assisting the bank, the statement said.
But Moore, 32, "provided continued assistance to OneUnited," including attending meetings and exchanging e-mails and phone calls with the bank's executives and "communicating with other congressional staffers regarding a legislative solution to the OneUnited's financial problems," according to the documents.
House rules generally prohibit lawmakers from putting spouses, children and a number of other family members on their congressional payrolls, but not grandchildren.
Waters came under scrutiny for calling then-Treasury Secretary Henry M. Paulson during the financial crisis to set up the meeting between his staff and representatives of minority-owned banks. The Office of Congressional Ethics report said the discussion at the meeting, however, "centered on a single bank — OneUnited."
Shortly after the meeting, according to the newly released documents, Moore sent an e-mail to Frank's staff, the subject of which said, "O[ne]U[nited] is in trouble." Other e-mails were sent between the chief of staff and OneUnited officials — including one from the bank's senior counsel to Moore reading, "Thank you for all your hard work," according to the committee.
Waters' attorneys assert in documents released Monday that the committee is treating the congresswoman differently than it has treated other lawmakers for similar conduct, citing the panel's dismissal of a case against a Missouri congressman who invited a business partner of his wife to testify at a hearing on alternative fuels.
Her attorneys argue that the charges against her run counter to a precedent that "actions taken by a member that may affect her interests as part of a larger class of shareholders do not violate House rules or ethical standards." Her attorneys also challenged the assertion that Waters' husband benefited from the bailout.
"If TARP funding neither saved OneUnited nor increased its stock value, this committee cannot establish that Rep. Waters received any financial benefit as a result of her alleged actions," her attorneys argued.
They also questioned whether e-mails sent to Frank's staff by Waters' chief of staff "alerting them about a constituent's [OneUnited's] concerns" constituted an ethics violation.
The bank official's thank-you e-mail to Moore was "a general thank you and not connected to any specific actions by Rep. Waters' office," they added.
But Reps. Kathy Castor (D-Fla.) and Michael K. Conaway (R-Texas), who investigated Waters, said in documents released Monday that regardless of whether OneUnited was helped by the congresswoman's chief of staff, "the appearance of acting for respondent's [Waters'] narrow financial interest was itself improper."