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Rep. Maxine Waters defends her work for minority-owned banks

The Los Angeles liberal scoffs at the idea that she could have influenced the Bush administration to give bailout funds to an institution with ties to her husband, even if she had tried.

March 14, 2009|Richard Simon

WASHINGTON — Rep. Maxine Waters (D-Los Angeles) on Friday defended her efforts to help minority-owned banks -- including one with ties to her husband -- scoffing at the notion that she, a liberal Democrat, could influence the Bush administration in deciding what financial institutions would receive bailout funds.

"Although both my supporters and detractors often refer to me as influential, the truth is that I had no influence on what Bush administration officials in the Treasury Department or other departments did," Waters said in a written statement.

Waters, an outspoken legislator who has held elective office in Sacramento or Washington for more than three decades, said her efforts were consistent with her longtime work to promote opportunity for minority-owned businesses and lending in underserved communities, such as her South Central Los Angeles district.

"I maintain that my advocacy on behalf of small, women, minority and community banks is appropriate," she said in the statement.

Waters, a senior member of the congressional committee that oversees banking, has come under scrutiny after OneUnited Bank received $12 million in bailout funds. Waters' husband, Sidney Williams, served on OneUnited's board and held stock in the bank. The bailout money was provided in December, three months after Waters helped arrange a meeting between officials from the bank and other minority-owned institutions and Treasury representatives.

Waters said the September meeting was requested by the National Bankers Assn., a trade group for woman- and minority-owned banks, to discuss the struggles of its members, not any one bank.

"I followed up on the association's request by asking Treasury Secretary [Henry M.] Paulson to schedule such a meeting, as did other members of Congress," she wrote, adding that she did not attend. She released National Bankers Assn. letters requesting the meeting and following up on it -- signed by the group's incoming chairman, Robert P. Cooper, a OneUnited officer.

Waters said the decision to give bailout funds to OneUnited was "based on the merits of the bank's request, not based on anything said at the September meeting and not based on political influence."

She said she had fully disclosed her husband's ties to the bank. Williams served on the bank board until early last year and held at least $500,000 in investments in the bank in 2007, the most recent year for which public financial disclosure statements are available.

She said in the statement that her husband "did not accept any director's compensation for his work on behalf of the bank and the community it serves" and "is proud to be invested in a minority-owned community bank that was given an 'outstanding' lending rating from its regulator for its lending activity in underserved communities in Los Angeles, where traditional banks have refused to lend."

Waters could not be reached for an interview Friday. OneUnited Chief Executive Kevin Cohee said he didn't have time to speak with a reporter.

Melanie Sloan, executive director of the watchdog group Citizens for Responsibility and Ethics in Washington, said Waters' behavior was "inappropriate and certainly has the appearance of impropriety, even if it doesn't rise to the level of an actual conflict of interest under House rules."

Sloan said Waters' comments that the meeting focused on the general problems of minority-owned banks "don't seem credible" in light of Treasury officials' statements that the session became a discussion of one bank's troubles.

"At a minimum, Treasury officials should have been apprised of her interest in the bank before the meeting took place," Sloan said.

Waters' efforts, she said, raise the question: "How many members of Congress are having meetings with the Treasury Department pleading for funds for certain banks?"

Sloan said: "Treasury has said they're going to list the lobbying contacts. Does that include if members of Congress are lobbying? It certainly should."

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richard.simon@latimes.com

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