"The Most Ethical Congress in History"

by Pejman Yousefzadeh on August 10, 2010

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If Maxine Waters was going to engage in conflicts of interest, she might have helped herself by not having been so unbelievably obvious about it:

The bank at the center of a House ethics investigation of U.S. Rep. Maxine Waters was the weakest to receive funds from the government’s Troubled Asset Relief Program at the time of its rescue, according to an analysis by the Investigative Reporting Workshop.

When then-Treasury Secretary Henry Paulson announced creation of the so-called “Capital Purchase Program” in October 2008, he said it was directed at “healthy institutions.” Nevertheless OneUnited Bank of Boston received a $12.1 million capital injection from the Treasury Department on Dec. 19, 2008. The money has not been repaid, according to Treasury Department documents.

Records show that as of Sept. 30, 2008, the latest quarter before the investment, OneUnited had “Tier 1 capital” of just 1.8 percent of assets. Of the 363 banks that got TARP money in the fourth quarter of 2008, at the height of the financial crisis, that was the lowest Tier 1 ratio.

In fact, none of the 987 banks that got TARP money between October 2008 and December 2009 reported a lower ratio in the quarter before they received federal cash. As of March 31, 2010, 16 TARP banks had lower Tier 1 ratios then OneUnited’s 4.98 percent.

Waters, a Democrat from Los Angeles, is alleged to have set up a meeting with regulators to help the bank, on whose board her husband served. OneUnited is based in Boston, but it has major operations in Los Angeles and Miami.

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