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Capitalizing on a Politician's Clout

The husband, daughter and son of Rep. Maxine Waters have business links to people the influential lawmaker has aided.

December 19, 2004|Chuck Neubauer and Ted Rohrlich | Times Staff Writers

This election, Rep. Waters sent out a slate mailer through her congressional committee, because of changes in federal election law. It's not clear what that means for the future of the L.A. Vote mailer.

Karen Waters or her brother, Edward, have also been paid as consultants by several of the same causes or politicians who have paid to appear on the sample ballot. Checchi's campaign, for example, paid Edward, while Karen was hired as a subcontractor by one of Checchi's other consultants.

Consultants who have hired Karen say she works only for candidates or causes her mother supports.

Indian tribes have been particularly good customers for both the slate mailer and Karen's consulting firm. Since 1998, they have paid $170,000 to the slate mailer operation and $126,000 to her firm for community outreach on gambling initiatives, their campaign reports show.

Meanwhile, Rep. Waters has backed the tribes' ballot measures and defended tribal gambling interests in Washington. Campaign consultants for the tribes said Karen Waters was hired because she does good work. "We didn't hire her because of her mom," said consultant Chuck Winner.


The Bond Business

While Karen Waters has been building a career in campaign consulting, the congresswoman's husband has found a lucrative niche in the municipal bond business.

In the last three years, Sidney Williams has made close to $500,000 by working part time as a consultant to a municipal bond underwriting firm and courting some of the same politicians his wife has endorsed, public records show.

"Sidney makes key introductions for me in the state of California," said Napoleon Brandford III, chairman and one of the owners of Siebert, Brandford & Shank, the largest minority- and women-owned bond underwriter in America.

The personal touch is important in the bond business, because most local and state governments award bond deals on a negotiated basis and not to the lowest bidder.

To stand out in years past, many bond underwriters wooed elected officials with campaign contributions. But after federal regulators stepped in a few years ago to limit that "pay to play" practice, some underwriting firms began paying politically connected consultants like Williams instead.

Williams had little or no background in the bond business when he began collecting consulting fees from Siebert in 2001, according to public records.

Married to Waters for 27 years, Williams was a former professional football linebacker turned Mercedes-Benz salesman, who in 1993 was named U.S. ambassador to the Bahamas by President Clinton after Waters earned Clinton's gratitude through her early support for his candidacy.

Brandford said he hired Williams based on Williams' own connections, not his wife's. Sometimes they are hard to distinguish.

One set of introductions, Brandford said, came in Inglewood, a mostly minority city of 112,000 in Waters' congressional district. Mayor Roosevelt Dorn credits Waters for helping get $10 million in loan guarantees from the Department of Housing and Urban Development last April and most every other federal dollar the city has received. "If she does not bless what we are seeking, our chances are slim to none," he said.

That's the way many local candidates feel about her support. Members of the Inglewood school board sought her endorsement, and all five paid her slate mailer operation to have it advertised.

When it came time for the school board members to decide on a new bond underwriter last year, Siebert, Brandford & Shank got the job. Sidney Williams earned his $54,000 fee for helping arrange the firm's contract to handle a $40-million school bond sale, according to the firm's chairman and public records.

What Williams did for Siebert is unclear. Brandford said Williams "introduced us to several of the school board members," although he said he could not remember which ones.

Willie Crittendon, then newly elected with Waters' help, said Williams called him and told him to "make sure you do your homework" on the bond deal but did not mention Siebert. Three board members said they did not speak to Williams about the deal, and board member Alice Grigsby would not answer questions about the matter.

Siebert pays Williams a 10% share of its net profit for each deal he helps the firm procure plus a $5,000-per-month retainer, according to documents the firm files with the Municipal Securities Rulemaking Board.

His biggest commission came from helping the firm win a bond contract from the office of another official his wife has endorsed: state Treasurer Angelides, a regular customer of the Waters slate mailer operation.

The last time Angelides ran for treasurer, in 2002, he paid $40,000 to advertise her endorsement in her sample ballot. Williams accompanied Brandford to meetings with Angelides and his staff, Brandford said. "Sidney knows the treasurer," said Brandford. "He knows him better than I do."

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