U.S. Rep. Maxine Waters has long-standing ties to a Boston-based bank that received millions of dollars in bailout funding, The Wall Street Journal reported today.
According to the report, the California congresswoman and her husband, Sydney Williams, were investors in two California banks that merged in 2002 to become OneUnited Bank.
OneUnited received $12 million from the Treasury Department's Troubled Asset Relief Program (TARP) in December.
Waters sold her shares in 2004. But according to her most recent financial-disclosure form, dated May 2008, Williams still owned shares whose value was somewhere between $250,000 to $500,000. Williams also served on the bank's board of directors until last year, and got "interest payments from a separate holding at the bank, also worth between $250,000 and $500,000," the Journal reported.
Waters' connection to the bank is important because she is a member of the House Financial Services Committee and has spoken out repeatedly in defense of OneUnited and its executives.
At the height of the banking crisis in September, she made calls to the Treasury Department on OneUnited's behalf to express her displeasure at the department's decision to put Freddie Mac and Fannie Mae under federal receivership. OneUnited had significant investments in the two companies, and their collapsed share prices wiped out much of the bank's capital, leaving it below the level typically needed to qualify for TARP aid.
In addition, The New York Times reported today that Waters also arranged a meeting between OneUnited executives and federal regulators. The Times said that, during the meeting, the company's CEO "seized the opportunity to plead for special assistance for his bank."
"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."
According to Treasury officials who attended the meeting and spoke with the Times, Waters did not tell them about her ties to the bank beforehand.
Soon afterward, House Financial Services Committee Chairman Barney Frank inserted language into a TARP bill that was specifically worded to permit bailout funding of OneUnited.
OneUnited has a mixed regulatory history. The Journal reported that the bank received an "outstanding" Community Reinvestment Act rating for its lending efforts in Los Angeles, but "has weak ratings in Massachusetts and failed to meet minimum standards in Florida."
In October, federal regulators told OneUnited to raise fresh capital, name an independent board, and cease paying for such executives perks as a $6.4 million Southern California beachside house used by its chairman.
BailoutSleuth will continue to follow this matter and update its readers as events warrant.
According to the report, the California congresswoman and her husband, Sydney Williams, were investors in two California banks that merged in 2002 to become OneUnited Bank.
OneUnited received $12 million from the Treasury Department's Troubled Asset Relief Program (TARP) in December.
Waters sold her shares in 2004. But according to her most recent financial-disclosure form, dated May 2008, Williams still owned shares whose value was somewhere between $250,000 to $500,000. Williams also served on the bank's board of directors until last year, and got "interest payments from a separate holding at the bank, also worth between $250,000 and $500,000," the Journal reported.
Waters' connection to the bank is important because she is a member of the House Financial Services Committee and has spoken out repeatedly in defense of OneUnited and its executives.
At the height of the banking crisis in September, she made calls to the Treasury Department on OneUnited's behalf to express her displeasure at the department's decision to put Freddie Mac and Fannie Mae under federal receivership. OneUnited had significant investments in the two companies, and their collapsed share prices wiped out much of the bank's capital, leaving it below the level typically needed to qualify for TARP aid.
In addition, The New York Times reported today that Waters also arranged a meeting between OneUnited executives and federal regulators. The Times said that, during the meeting, the company's CEO "seized the opportunity to plead for special assistance for his bank."
"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."
According to Treasury officials who attended the meeting and spoke with the Times, Waters did not tell them about her ties to the bank beforehand.
Soon afterward, House Financial Services Committee Chairman Barney Frank inserted language into a TARP bill that was specifically worded to permit bailout funding of OneUnited.
OneUnited has a mixed regulatory history. The Journal reported that the bank received an "outstanding" Community Reinvestment Act rating for its lending efforts in Los Angeles, but "has weak ratings in Massachusetts and failed to meet minimum standards in Florida."
In October, federal regulators told OneUnited to raise fresh capital, name an independent board, and cease paying for such executives perks as a $6.4 million Southern California beachside house used by its chairman.
BailoutSleuth will continue to follow this matter and update its readers as events warrant.
published March 12, 2009, 0 Comments
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