OneUnited received more preferential treatment than first disclosed

posted at 11:36 am on September 17, 2010 by Ed Morrissey

Maxine Waters and the Democrats may have thought that all of the bad news from her intervention with OneUnited bank had already been aired, but the Washington Post reports that the House Ethics Committee only scratched the surface.  Far from a single intervention by Waters, the record shows an unprecedented effort conducted by Congress, Treasury, and its regulators to rescue the bank in which Waters’ husband had invested a significant amount of money.  In 707 applications of TARP money, OneUnited got the most special attention:

From the moment Boston-based OneUnited Bank began seeking a federal bailout in the summer of 2008, it received special treatment that went beyond what the Treasury Department or the bank and its political supporters have previously disclosed.

Congress adjusted the law and regulators broke with customary practices, despite an explicit internal warning that the bank was in financial trouble. Among other exceptions, the bank was allowed to count as part of its capital $12 million in federal bailout money – before the aid arrived.

OneUnited was the only bank to receive all of these considerations among the 707 recipients of money from the Troubled Assets Relief Program, according to documents and interviews.

Guess where that has left the American taxpayer?  Holding the bag.  OneUnited has failed to repay its TARP funds on time, one of only a “handful” of banks to go into arrears, according to the Post.  Clearly, strings got pulled to rescue OneUnited despite its risky status.

How did those strings get pulled?  The FDIC had a secret program to identify banks that had the potential of “unnecessary press or public relations” problems.  That was apparently shorthand for banks that had connections to public officials.  If that sounds familiar, think of Countrywide’s “Friends of Angelo” program for giving special low-cost mortgages to people like Chris Dodd and Jamie Gorelick in order to build influence.  The FDIC and Treasury insists that they didn’t treat OneUnited any differently, but the existence of the FDIC program — and all of the exceptional treatment OneUnited received — strongly suggests that the rescue was politically motivated.

The Post reviews the intervention sequence.  After Waters came to Frank for help, without mentioning (according to Frank) that her husband still held a stake in the bank, Frank, Treasury, and the FDIC flew into action:

Frank told a committee aide to raise the issue of ensuring that OneUnited and similar banks were eligible for assistance at a meeting with Treasury Secretary Henry M. Paulson Jr., while other aides contacted the FDIC. The department was “looking underneath sofa cushions” to try to help the bank, one aide told another in an e-mail on Sept. 19, but it lacked legal authority.

In late September, OneUnited’s counsel suggested to a Waters aide that if Treasury declined the bank’s request, there might be a “legislative solution.” Frank subsequently inserted a provision into the TARP legislation to help the bank. He emphasizes that it was different from the direct payment OneUnited sought. It more generally authorized assistance to institutions serving low-income populations that lost significant capital from the Fannie and Freddie stock devaluation. No hearings were held on the bill, which President George W. Bush signed into law on Oct. 3, 2008. …

OneUnited promptly applied for a grant, and a special counsel in Frank’s office in Newton, Mass., started calling Treasury officials, including Neel Kashkari – then the top official responsible for approving such grants. “BF is interested and may call” the Treasury secretary about it, one of the officials warned Kashkari and others in an Oct. 17 e-mail. “Maxine Waters is interested in the bank as well.”

Ten days later, in what officials say was part of a deal negotiated with OneUnited, the FDIC formally issued a public cease-and-desist order charging the bank with lax lending standards, paying excessive executive compensation, and “committing violations of law and regulations.”

Three days later, with OneUnited slated to issue a key quarterly report, the FDIC’s five board members voted unanimously to exempt the bank from a 1995 accounting rule that binds every other bank under the agency’s jurisdiction. In doing so, they cited the authority provided under Frank’s amendment.

How convenient!  And the FDIC board members all knew of Waters’ connection to the bank — but claim that it didn’t influence their decision.  Riiiiiight.

Be sure to read the entire, extensive report by R. Jeffrey Smith at the Post.


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What a coincidence, that a bank the Waterses invested in got all that special treatmnet. If I didn’t know better I’d say something fishy’s goin on.

Akzed on September 17, 2010 at 11:40 AM

You know what would be a really smart fashion “look” for Maxine…?

Kent18 on September 17, 2010 at 11:40 AM

Concurrent with this we have a blurb from ‘The Hill’ (via Drudge):

“Three staffers working for embattled Rep. Maxine Waters (D-Calif.) were asked by security officers to leave an event in downtown Washington on Thursday after they tried to display large campaign signs just as House Speaker Nancy Pelosi (D-Calif.) was about to speak.

The aides were holding lawn signs that defended Waters from the ethics charges she is facing in the House.”

Her own staffers are running around with signs defending her? Come on. Seriously, come on.

Bishop on September 17, 2010 at 11:40 AM

And the FDIC board members all knew of Waters’ connection to the bank — but claim that it didn’t influence their decision.

But did she call up and ask for donations?

lorien1973 on September 17, 2010 at 11:42 AM

B. Frank and Mr & Mrs Waters- please report to jail.

journeyintothewhirlwind on September 17, 2010 at 11:42 AM

Congress adjusted the law and regulators broke with customary practices

That sums up this administration.

(PS That is one fugly heifer. She looks like she just ate a lemon)

sicoit on September 17, 2010 at 11:43 AM

This is criminal, and there is a whole lot more of it in congress disguised as politics.

Skandia Recluse on September 17, 2010 at 11:44 AM

Just blame “whitey”…

Seven Percent Solution on September 17, 2010 at 11:45 AM

Her own staffers are running around with signs defending her? Come on. Seriously, come on. Bishop on September 17, 2010 at 11:40 AM

D-u-t-c-h-e-s-s.
F-i-e-f-d-o-m.
S-e-r-f-s.

You need to familiarize yourself more with our form of govt.

Akzed on September 17, 2010 at 11:45 AM

I know it’s not just me. There is a real epidemic of corruption being investigated amongst the Black Caucus in Congress. And it won’t be me who votes them out of office if found guilty either.
African Americans deserve better representation and role models in Congress. They can continue to vote for serfdom, or they can free themselves from the soft tyranny of Democrat racialism.

Randy

williars on September 17, 2010 at 11:47 AM

Congress adjusted the law and regulators broke with customary practices…

Now where have I heard that before…?

… Oh, wait!

Seven Percent Solution on September 17, 2010 at 11:47 AM

It appears that the swamp needs a little more drainin’.

pain train on September 17, 2010 at 11:48 AM

These damm crackers keep finding stuff on me.

Hummer53 on September 17, 2010 at 11:48 AM

If I lived 200 ft. closer to the beach, I won’t be in her district. F*ck you Maxine!!

Apologetic California on September 17, 2010 at 11:49 AM

Wow, I’m shocked.

bernzright777 on September 17, 2010 at 11:50 AM

Among other exceptions, the bank was allowed to count as part of its capital $12 million in federal bailout money – before the aid arrived.

Exsqueeze me?

Sharke on September 17, 2010 at 11:50 AM

She must have known this stuff would come out, but she still lies about it. Then, the item on Drudge about the signs touting her innocents, one of the young men stated she was his Aunt, and even this she denies. WTF?

nwpammy on September 17, 2010 at 11:51 AM

Gee – Maxine seems so honest — or something.

jake-the-goose on September 17, 2010 at 11:51 AM

This is criminal, and there is a whole lot more of it in congress disguised as politics.

Skandia Recluse on September 17, 2010 at 11:44 AM

Amen! Both Waters and Frank should be facing jail time.

onlineanalyst on September 17, 2010 at 11:52 AM

I know it’s not just me. There is a real epidemic of corruption being investigated amongst the Black Caucus in Congress. – williars on September 17, 2010 at 11:47 AM

Since slavery ended only yesterday…

… reparations are in order. Didn’t you know that?

/

Seven Percent Solution on September 17, 2010 at 11:52 AM

This is social justice. She Blaimed Bush and they had no choice.

She thinks it is ok to cimit a crime to offseet the victumhood from a previous crime.

seven on September 17, 2010 at 11:53 AM

The swamp hasn’t even begun to drain. It just keeps building. This is going to be one, ugly septic explosion.

BetseyRoss on September 17, 2010 at 11:53 AM

It’s much better to have seasoned poiticians with experience running the country than average citizens. Average citizens don’t have nearly enough contacts within the beltway to make the hard decisions.

a capella on September 17, 2010 at 11:53 AM

Well there sure will be alot to chat about tonight at the wh black caucus foundation black tie event!
L

letget on September 17, 2010 at 11:54 AM

This woman belongs in prison, not in Congress. And the same is true of her enabler Barney Frank.

AZCoyote on September 17, 2010 at 11:54 AM

With help from congressman Smith Barney.

Calling her an idiot really doesn’t do justice to her level of stupidity.

fogw on September 17, 2010 at 11:54 AM

I know it’s not just me. There is a real epidemic of corruption being investigated amongst the Black Caucus in Congress. And it won’t be me who votes them out of office if found guilty either.
African Americans deserve better representation and role models in Congress. They can continue to vote for serfdom, or they can free themselves from the soft tyranny of Democrat racialism.
Randy

williars on September 17, 2010 at 11:47 AM

Nahh. It’s easier to just blame racism. For instance, James Clyburn just claimed that Maxine Waters was a GOP plant.

ChrisB on September 17, 2010 at 11:55 AM

Clearly, strings got pulled to rescue OneUnited despite its risky status.

Racist

Waters,Jefferson,Rangel,Geithner,Daschle,Murtha,Giannoulias,Bernice Johnson,Blagojevich…..

……….have done nothing wrong according to liberals

……………it’s all about the color of their skin.


It’s about black people,” Waters said.

Thank God Nancy cleaned up the swamp.

Baxter Greene on September 17, 2010 at 11:56 AM

Her own staffers are running around with signs defending her? Come on. Seriously, come on.

Bishop on September 17, 2010 at 11:40 AM

You missed the kicker…

The staffers who attended the Pelosi event declined to speak to The Hill, but before leaving one of the aides identified Waters as his aunt

Not just “staffers”. Not just relatives. But staffers who are relatives???

taznar on September 17, 2010 at 11:56 AM

It’s much better to have seasoned poiticians with experience running the country than average citizens. Average citizens don’t have nearly enough contacts within the beltway to make the hard decisions.

a capella on September 17, 2010 at 11:53 AM

So true. We average citizens don’t know who to bribe first, or what amount of cash to bring to the first meeting.

AZCoyote on September 17, 2010 at 11:58 AM

Be sure to read the entire, extensive report by racist reporter R. Jeffrey Smith at the Post.

Fixed.

Del Dolemonte on September 17, 2010 at 11:58 AM

… reparations are in order. Didn’t you know that?
Seven Percent Solution on September 17, 2010 at 11:52 AM

Yep. Reparations from the black royalty to their serfs.
Randy

williars on September 17, 2010 at 12:02 PM

Nothing to see here. Move along. After all, under Barry’s social engineering programs, THEY’RE ENTITLED!

And if you complain, you’re just RACIST! and HOMOPHOBIC!

The big question is WHERE’S HOLDER? WHERE’S PELOSI? Wasn’t Nancy supposed to drain the swamp? Where’s Sheriff Joe?

GarandFan on September 17, 2010 at 12:02 PM

From the moment Boston-based OneUnited Bank began seeking a federal bailout in the summer of 2008, it received special treatment that went beyond what the Treasury Department or the bank and its political supporters have previously disclosed.

-
Well duuuh… That’s the whole reason to have family in powerful places.

RalphyBoy on September 17, 2010 at 12:07 PM

It appears that the swamp needs a little more drainin’.

No, no, no! You’ve got it all wrong! The “swamp” Pelosi was referring to meant the REPUBLICANS, not the Democrats. She has cleaned up the Republican swamp, and it’s high and dry and all moral and ethical and stuff. Her cleanup of the dem swamp has been held up by an EIR that says that the swamp is supposed to be swampy, and therefore there is no need to change anything there at all.

Bob's Kid on September 17, 2010 at 12:07 PM

Upcoming response from Waters:

“I didn’t know I was related to my husband”.

BobMbx on September 17, 2010 at 12:09 PM

OOPSIEE!!!!

CynicalOptimist on September 17, 2010 at 12:16 PM


She’s fighting back…

d1carter on September 17, 2010 at 12:19 PM

The fed-up racists are demanding justice.

Sorry, my /sarc/ key was depressed.

The fed-up honest, American Taxpayers are demanding justice.

DuctTapeMyBrain on September 17, 2010 at 12:24 PM

The big question is WHERE’S HOLDER? * * * Where’s Sheriff Joe?

GarandFan on September 17, 2010 at 12:02 PM

He’s busy suing Sheriff Joe, of course. There are certain priorities to be maintained.

Barnestormer on September 17, 2010 at 12:30 PM

Now we find out Frank has been playing a Sergeant Schultz routine. It sounds to be that his hands are all over this.

Waters may be bulletproof in her district–indeded, she may score points for “stickin’ it to the man”–but can Frank’s opponent use this to his advantage? Are Frank’s constituents down for this kind of corruption?

Paging Darrell Issa.

BuckeyeSam on September 17, 2010 at 12:39 PM

“Three days later, with OneUnited slated to issue a key quarterly report, the FDIC’s five board members voted unanimously to exempt the bank from a 1995 accounting rule that binds every other bank under the agency’s jurisdiction. In doing so, they cited the authority provided under Frank’s amendment.”

This is the problem with people bureaucrats, like Sebellius, or elected politicians, like Waters. They’re thieves and crooks. The rest, like the FDIC board members, are facilitators because they’re lily-livered pantywaists who value their job more than doing the right thing, but I do have a little sympathy for them when people like Obama can get away with firing IG’s with impunity — there’s no one now to protect anyone in government from having to bargain with the devil on a daily basis.

Corruption in government needs to be enforced to the T with penalties much higher, and be made mandatory, than it is for the rest of us peons. Jail time. Full sentences. No parole.

Dusty on September 17, 2010 at 12:48 PM

Amazing that the Post, a liberal rag, even pursued this story. Will heads roll there? One wonders….

chai on September 17, 2010 at 12:52 PM

It was really quite obvious from the beginning–She protesteth too much!

rjoco1 on September 17, 2010 at 12:55 PM

Democrat corruption sure is stimulatin’

dthorny on September 17, 2010 at 12:59 PM

This is criminal, and there is a whole lot more of it in congress disguised as politics.

Skandia Recluse on September 17, 2010 at 11:44 AM

Amen! Both Waters and Frank should be facing jail time.

onlineanalyst on September 17, 2010 at 11:52 AM

You forgot Dodd.

Owen Glendower on September 17, 2010 at 1:16 PM

And then the black communities re-elect these crooks more often than not. Rangel is case in point. Does being black give you license to bend or break the law with impunity? Apparently so.

jeanie on September 17, 2010 at 1:17 PM

A real article from the MSM????

Yikes.

I guess they figure it’s time to shore up their cred, now that the Dems are doomed in November anyway.

PattyJ on September 17, 2010 at 1:23 PM

As for Frank….the many, many unemployed, the businesses closing all over the place and the mountains of foreclosed homes are on his head(along with Dodd and Schumer). Catastrophe all round but two of those three go on and on. All the tragedy, loss of livlihood, and losses of ones business–these 3 stand hip deep in this wreckage. Do they look around at all and see what they’ve caused? Bet not!!! Neither, apparently do their constituents(except CT, maybe?).

jeanie on September 17, 2010 at 1:23 PM

I’m afraid I can’t get upset about this until I know Maxine Waters’s opinion about masturbation.

MayBee on September 17, 2010 at 1:30 PM

She should be rotting in prison by now.

TrickyDick on September 17, 2010 at 1:45 PM

The only way to deal with this is to enact swift and harsh justice. Those we will elect in the next 2.5 years should know that we are watching how they handle these scumbags very closely. You’re either on the side of right or wrong. Just because you’re an elected official doesn’t mean you get to play the middle. This woman and her cronies are all crooks who need to be shown – rails. tar. feathers. and a jail cell.

HomeoftheBrave on September 17, 2010 at 1:50 PM

Swamp drainage should be incensed.

hillbillyjim on September 17, 2010 at 1:56 PM

So, there were no banks in LA’s South Central that Maxie’s hubbie could have invested in? Special consideration for a Boston Bank? Not even willing to “spread the wealth around” in her own District?

coldwarrior on September 17, 2010 at 2:01 PM

Brings “too big to fail” into rather sharp focus wouldn’t you agree?

speed on September 17, 2010 at 2:12 PM

Y’know, it’s really amazing.

Just when you think Congress, especially this Congress but true of plenty of GOP-led cesspools of the past, can’t sink any lower, you find yourself disappointed yet again.

And yet the voters of his district keep sending Barney Frank to the Hill, and LA keeps sending Maxine, and Harlem keeps sending Charlie.

There’s got to be some way (short of IEDs) to get rid of these people.

JEM on September 17, 2010 at 2:27 PM

Scr*w jail time for this clown.

I prefer ironic (b!atchslap?) justice:

Let’s just SOCIALIZE her paycheck.

Lockstein13 on September 17, 2010 at 2:29 PM

Let’s just SOCIALIZE her paycheck.

Lockstein13 on September 17, 2010 at 2:29 PM

Nice sentiment, but I don’t think her House paycheck is where her real money comes from.

teke184 on September 17, 2010 at 2:31 PM

Any chance the “possibility” of a protracted House session before the midterms may have just become a bit more likely?

BKeyser on September 17, 2010 at 2:55 PM

Well duuuh… That’s the whole reason to have family in powerful places.

RalphyBoy on September 17, 2010 at 12:07 PM

That sounds somewhat like:

The family that PREYS together, stays together.

belad on September 17, 2010 at 3:32 PM

Something stinks to high heaven, and it ain’t her flat feet.She is corrupt to the core, a re-distributionist, a reparations queen with a room temperature IQ.

Her and Norton (AKA the DC Shakedown Madam) are as corrupt as Captain Negative Harry and Nancy “757″ Botox.

Clear Supermax in CO to make room for these cretins.

Cleveland Steamer on September 17, 2010 at 3:42 PM

R. Jeffrey Smith soon to formerly be at the Post

The Post is a state run newspaper. This guy should be fixing up his resume.

PastorJon on September 17, 2010 at 4:52 PM

Amen! Both Waters and Frank should be facing jail time.
onlineanalyst on September 17, 2010 at 11:52 AM
You forgot Dodd.

Owen Glendower on September 17, 2010 at 1:16 PM

I’m sure Barney would volunteer, why reward him?

dthorny on September 17, 2010 at 5:58 PM