A House ethics panel is investigating whether Rep. Maxine Waters of Los Angeles inappropriately contacted federal regulators on behalf of bank seeking bailout assistance.
Earlier this year, numerous news organizations reported that Ms. Waters had made two separate overtures on behalf of Boston-based One-United bank. The first was to complain about the Treasury 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 assistance under the Troubled Asset Relief Program.
In the second episode, Ms. Waters reportedly arranged a meeting between OneUnited executives and federal regulators at which the company's CEO "seized the opportunity to plead for special assistance for his bank." The bank later received $12 million in bailout funding.
The meetings are controversial because Ms. Waters' husband, Sydney Williams, at the time 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 received six-figure dividends.
Until this week, it was unknown whether the Ms. Waters' actions had prompted a House ethics investigation. The house panel announced this week that it was extending its probes into three congressmen, including Ms. Waters, for 45 days. The other investigations are unrelated to the banking bailout.
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