Rep. Maxine Waters' grandson, Mikael Moore, worked on legislation to help OneUnited Bank, according to new allegations in the House Ethics report issued today.
Waters, D-Los Angeles, has been under fire for more than a year for helping to arrange a meeting between OneUnited representatives and the Treasury Department. Waters' husband owned stock in the bank, which was seeking a $50 million bailout.
Treasury officials shot down the request, but the new information in the ethics report shows that Waters' assistance to the bank didn't end there.
Waters' husband, Sidney Williams, held about $350,000 in OneUnited stock in June 2008. But OneUnited's value plummeted when the government took over Fannie Mae and Freddie Mac, in which the bank was heavily invested. By September 2008, Williams' investment was worth $175,000, and was in danger of evaporating completely if the bank failed.
The Treasury meeting was on Sept. 9, 2008. Ten days later, Waters' grandson, Mikael Moore -- who is also her chief of staff --
sent an e-mail to the office of Rep. Barney Frank stating that "O[ne]U[nited] is in trouble."
Frank is the chair of the House Financial Services committee, which was then engaged in crafting the TARP legislation to bail out the financial system. Frank's staffer wrote back: "depends on scope."
The next day, Moore sent draft legislation to Kevin Cohee, the CEO of OneUnited. The legislation would give Treasury officials authority to purchase mortgage assets from OneUnited. They exchanged several more e-mails on the subject over the following week.
The TARP legislation included language aimed at OneUnited and other banks that had taken a beating due to the decline of Fannie and Freddie stock. Such banks were explicitly allowed to apply for TARP funding. OneUnited did, and received $12 million.
A few days before TARP was signed into law, Robert Cooper, the general
counsel of OneUnited, sent Moore a message: "Thanks for all your hard
The ethics report concludes:
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If OneUnited had not received this money, [Waters'] husband's financial interest in OneUnited would have been worthless. Thus the preservation of value of [Waters'] husband's investment in OneUnited personally benefited [Waters].
In rebutting the allegations, Waters has summed up the case in this way: "No benefit, no improper action, no failure to disclose, no one influenced, no case."
That argument is harder to make in light of the new information. It certainly appears that Moore pushed Frank's office to craft the TARP legislation to benefit OneUnited, and OneUnited did in fact benefit from that influence.
Waters has refused to settle the case, which means it will probably go to a trial in the Ethics Committee.