Maxine Waters - Crony Capitalist

Michelle Malkin has a lot of fun with Representative Maxine Waters rank hypocrisy. First Waters embarrasses herself in browbeating and shrieking at bankers testifying before the House Banking Committee.

At a flail-and-wail House hearing last month, California Democratic Rep. Maxine Waters melted down in front of big banking CEOs. "Raise your hand! Raise your hand!" she shrieked as she harangued the executives on their business practices and management of federal bailout money. Sneering at the "captains of the universe," whom she refused to address by name ("You, Bank of America!"), Waters excoriated the corporate heads for their greed. "All of my political life," Waters bragged, "I have been in disagreement with the banking and mostly financial services community because of practices that I have believed to be not in the best interest always of the very people that they claim to serve."

Yet guess who was channeling TARP money to a bank that had contributed to her campaigns and in which she had owned stock and her husband currently owns a considerable amount of stock.

The Wall Street Journal reported Thursday that the high-and-mighty Waters had a personal and financial stake in Boston-based OneUnited, a minority bank that received $12 million in TARP money under smelly circumstances. The banks' executives donated $12,500 to her congressional campaigns. Her husband, Sidney Williams, was an investor in one of the banks that merged into OneUnited. They've profited handsomely from their relationship with the bank:

"Congressional financial-disclosure forms show Ms. Waters acquired OneUnited stock worth between $250,000 and $500,000 in March 2004, as did Mr. Williams. Mr. Williams joined the board of OneUnited that year.

"Each sold shares in September 2004 -- including Ms. Waters' entire stake -- but Mr. Williams continued to hold varying amount of the company's stock. In the lawmaker's most recent financial-disclosure form, dated May 2008 and covering the prior year, Ms. Waters reported that her husband held between $250,000 and $500,000 worth of the bank's stock.

"Mr. Williams also received interest payments from a separate holding at the bank, also worth between $250,000 and $500,000. The 2008 form doesn't specify what that is. Mr. Williams stepped down from the bank's board last spring. It couldn't be learned whether he still owns stock in the bank. Mr. Williams didn't return calls seeking comment."

Waters (along with Frank) participated directly in pressuring the feds for OneUnited's piece of the bailout pie. She personally contacted the Treasury Department last December requesting $50 million for the company -- and failed to disclose her ties to the bank to them. The government ended up coughing up $12 million in TARP funding for OneUnited -- despite another government agency rapping the bank in October 2008 for "operating without effective underwriting standards and practices," "operating without an effective loan documentation program" and "engaging in speculative investment practices."

Oh, and get this: The favored bank of Maxine Waters was also penalized for alleged excessive executive compensation. The FDIC ordered the bank to "sell all bank-owned automobiles," require reimbursement for executives' car purchases (according to the Boston Business Journal, OneUnited CEO Kevin Cohee was cruising around in a 2008 Porsche SUV), and cease payments on a $6 million Santa Monica beachfront home purchased by Cohee, his wife, Teri Williams, who served as bank president, and others.

Responding to scrutiny of the bank's special treatment, Cohee is now accusing critics of -- yep, you guessed it -- racism.

How convenient. Having your demagogic rant and then sending money to your own favorite banker.

Just as a reminder, here's the story about Barney Frank slipping TARP money to his local favorite bank, the same OneUnited.

Troubled OneUnited Bank in Boston didn't look much like a candidate for aid from the Treasury Department's bank bailout fund last fall.

The Treasury had said it would give money only to healthy banks, to jump-start lending. But OneUnited had seen most of its capital evaporate. Moreover, it was under attack from its regulators for allegations of poor lending practices and executive-pay abuses, including owning a Porsche for its executives' use.

Nonetheless, in December OneUnited got a $12 million injection from the Treasury's Troubled Asset Relief Program, or TARP. One apparent factor: the intercession of Rep. Barney Frank, the powerful head of the House Financial Services Committee.

Mr. Frank, by his own account, wrote into the TARP bill a provision specifically aimed at helping this particular home-state bank. And later, he acknowledges, he spoke to regulators urging that OneUnited be considered for a cash injection.

Next time that the Banking Committee has an attackfest aimed at the handling of the TARP funds, perhaps they might call their very own Maxine and Barney to move around to the witness table and answer a few questions of their own.