- Post 06 October 2012
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The headlines proclaim that Rep. Maxine Waters, the outspoken Democrat from California, has been cleared of charges that she violated House ethics by advocating on behalf of a Black bank in which her husband held a substantial investment. The real story, however, is that Waters case serves as Exhibit A for how a Black elected official who has done nothing wrong can have her name smeared for several years largely because of partisan politics.
Although the official report is filled with carefully calibrated references that downplays the infighting and partisanship that characterized the investigation, it is clear from the report that when the investigation commenced, it was obvious that Waters had never tried to hide her husband's participation in OneUnited Bank, the Boston-based institution at the center of the investigation, and that she believed she was acting on behalf of the National Bankers Association, an organization of Black banks, when she arranged between a group of bankers and then-Secretary of Treasury.
OneUnited, a member of the National Bankers Association, was in danger of closing its doors and was seeking $50 million in federal bailout money to stay afloat. Waters' husband, Sidney Williams, a former board member of OneUnited, owned bank stock valued at $350,000 that he would have lost if the bank had tanked.
House conflict-of-interest rules prohibit members of Congress from using their official position on behalf of an entity in which they have a personal interest. In Waters' case, as a senior member of the House Financial Services Committee and a strong advocate for Black banks, it was not uncommon for her to arrange meetings between federal officials and the National Bankers Association.
According to the report "Outside Counsel concluded that Representative Waters reasonably believed, at the time she requested the meeting, that the attendees would be speaking on behalf of minority banks generally. While it appears that all of the minority bankers who attended the meeting were associated with OneUnited, and that OneUnited was alone in requesting substantial financial assistance from the Treasury Department at the meeting, the record indicates that Representative Waters did not have reason to know of either of these facts when she arranged the meeting."
Waters made no secret of her husband's involvement in OneUnited. She made it part of her public financial disclosure reports. In addition, according to the Ethics Committee finding, "it appears that Representative Waters recognized and made efforts to avoid a conflict of interest with respect to OneUnited. She informed the then-Chairman of the House Financial Services Committee that she was 'not going to be involved in' OneUnited's request for assistance from the Treasury Department, and then relayed this decision to her COS [Chief of Staff]."
House Republicans were aware of the pertinent facts but decided to pursue the case against Waters anyway. The final report noted that there was "an extended, and at time contentious investigation of the allegations."
The committee hired William "Billy" Martin, a respected African-American attorney, to serve as outside counsel. His investigation found that some staff members communicated only with members of one party without communicating with the rest of the committee and that one staffer had made comments that were "racially insensitive and completely inappropriate."
Although Martin did not name the specific party in question, it is easy to deduce that staffers were communicating with Republicans, who hold a majority on the committee, and not Democrats. In addition, Republican committee members were also communicating with House leadership about the investigation, which was supposed to be non-partisan.
The investigation became so tainted that, in what they described as a move to assure that Waters was being treated fairly, the entire 10-member panel and staff investigating Waters were replaced. And it was this new committee, working with Martin, that exonerated Waters.
"Outside Counsel recommended and the Waters Committee concluded that Representative Waters did not violate any House Rule, law, regulation, or other applicable standard of conduct," the report stated.
It did not reach the same conclusion about Mikael Moore, the congresswoman's chief of staff and grandson.
The report said, "However, the Waters Committee finds that Representative Waters' COS violated House rules by taking specific actions that would accrue to the benefit of OneUnited, a bank Representative Waters had a significant financial interest in and which interest could have been significantly impacted by the actions." The committee found Moore's testimony on the matter lacked credibility and issued him a letter of reproval.
Congress prohibits its members from hiring of close relatives, a definition that does not include grandchildren. Because of the Waters case, however, the committee members think that time has come to broaden the definition of close relatives to include grandchildren.
Waters contended all along – and the evidence was there to support her assertion – that she had done nothing improper. But House Republicans were intent on dragging her name through the mud. This is one of the few times that they have been fully exposed. How many other Black lawmakers have been subjected to the same treatment, but that information never became public?