Top banking regulators were taken aback late last year when a California congresswoman helped set up a meeting in which the chief executive of a bank with financial ties to her family asked them for up to $50 million in special bailout funds, Treasury officials said.
Representative Maxine Waters, Democrat of California, requested the September meeting on behalf of executives at OneUnited, one of the nation’s largest black-owned banks. Ms. Water’s husband, Sidney Williams, had served on the bank’s board of directors until early last year and has owned at least $250,000 in stock in the institution. Treasury officials said the session with nearly a dozen senior banking regulators had been intended to allow minority-owned banks and their trade association to discuss the losses they had incurred from the federal takeover of Fannie Mae and Freddie Mac. But Kevin Cohee, OneUnited’s chief executive, instead seized the opportunity to plead for special assistance for his bank, federal officials said.
“Here you had a tiny community bank that comes in and they are not proposing a broader policy – they were asking for help for themselves,” said Steve Lineberry, a former Treasury aide who attended the meeting. “I don’t remember that ever happening before.”
Ms. Waters declined on Tuesday to comment on the meeting, or to say if her husband still owns OneUnited shares. Her staff released two letters that showed the meeting was initially called to discuss industry concerns broadly, not matters related just to OneUnited.
The congresswoman, a member of the House Financial Services Committee, did not disclose her ties to OneUnited to Treasury officials, who said they learned of them only later.
“It is upsetting to me,” said Jeb Mason, then the deputy assistant secretary for business affairs at Treasury, whose office helped set up the meeting. “This is something that was potentially politically explosive and embarrassing to the administration. They should have at least let us know.”
While OneUnited did not get the $50 billion it requested, the bank did become among the first minority-owned institutions to receive a cash infusion – $12 million – in December through the Treasury’s bank bailout effort, called the Troubled Asset Relief Program.
The aid surprised some bank analysts because the bailout was intended for healthy banks, and OneUnited was then considered to be in precarious condition. In addition, it had been harshly criticized by regulators in 2007 for failing to give a sufficient number of loans to lower income residents in Miami, while favoring wealthier customers there. And the F.D.I.C. sanctioned the institution in October 2008 for “unsafe or unsound banking practices,” including excessive compensation for Mr. Cohee. The bank had provided him with a 2008 Porsche SUV and maintained his $6.4 million beachfront compound in Santa Monica. Calif., with views of the Pacific and a spa and pool.
Critics of OneUnited, which is based in Boston and has branches in poor neighborhoods of Los Angeles and Miami, say the episode shows how special access arranged through a lawmaker with financial ties to the bank had compromised the integrity of the federal bailout effort.
“A member of Congress should not be helping out a family friend, especially one they share business ties with” said Kenneth H. Thomas, a Florida banking consultant who has filed complaints with federal regulators about OneUnited’s lending practices. “The folks who really need help here is the community served by OneUnited – a community that is starving for credit. “
Mr. Cohee and Treasury officials said the TARP money had nothing to do with the intervention by Ms. Waters. Mr. Cohee also suggested that criticism of his operations by federal banking regulators was racially motivated.
Couldn’t have had anything to do with the improper lending of millions of taxpayer dollars to a struggling bank with questionable business ethics, could it? Nope. Racist.
Read Michelle Malkin’s syndicated column about Ms. Waters.
Get a load of this video. What a self righteous, rude woman. This is performance art, not questioning.
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5 Comments
March 12, 2009 at 11:40 pm
Ms. Waters appeared on the Black State of the Union and she said we gots to bail out all those in the community because they dont got no opportunity. How these folks need to be bailed out of their mortgages because you know they were lied to about the mortg. loans (we cant hold them responsible or accountable, thats just plain cruel ya know) and boy she makes it sound like the people were swiped off the street and forced to sign by gun point. And damn it no free toaster either.
March 13, 2009 at 6:33 am
That pic of Dear Maxine is self explanatory, with the sour puss of JJ (Jessie Jackson) on her left, need anything else be said? Folks, you can thank Rev Wright for this one because he took the gloves off during the presidential campaign. A black, female, democrat can say and do most anything she wants. If anyone makes ANY type of comment that isn’t in line with Maxine’s, they are labeled a racist, sexist, or facist. Thank you Rev Wright, now we can have honest discussion on race relations.
March 16, 2009 at 12:17 am
I’m with Chet but there are a host of others who need to go there as well. I was recently published in the Greensboro News & Record in the editorial column. I have asked Sen. Richard Burr to sponsor legislation that prohibits serving in the Senate or Congress (including all staffers) unless your taxes are paid. I almost had my home taken over $1500.00 a few years back, then when I paid, the IRS credited it to somebody else’s account. Thank God for the Taxpayer’s Advocates Office! I have them on speed dial 800-253-3049 just in case. All these BUM’S need to be impeached! How does one start a Grass Roots Movement?
March 16, 2009 at 12:34 am
One other thing that needs to go by the wayside. The Black State of the Union? At least it isn’t called the African American State of the Union. We are a Country of one, American. I think it is high time we started addressing ourselves as such. These labels are now a thing of the past. How can we as Citizens get past this racial hurdle with these exploitive monikers still attached? I would expect a continuation of this had Jessie Jackson been elected, but not Barack Obama, he knows the standard is higher than that of Mr Jackson, I hope.
May 9, 2009 at 10:52 am
Tribalism, not Americanism.