In a special piece for The Root, Rep. Maxine Waters (D-CA) denies allegations that she improperly aided minority-owned banks during the federal bailout of troubled financial institutions:
I have been an outspoken advocate for minority communities and businesses in California and nationally for decades. Recent press reports suggest that somehow I have acted improperly in advocating for minority banks.
Let me set the record straight:
Last year as the financial crisis was unfolding, jeopardizing the health of banks large and small, the National Bankers Association (NBA), the leading trade organization which represents the interests of America’s minority-owned banks, requested a meeting with Treasury Department officials. A letter from NBA to Treasury indicates the intent of the meeting and the dire concern expressed by the association on behalf of its members. NBA contacted Treasury directly, just as other trade associations did, to request a meeting so that its members could discuss their concerns regarding the situations facing minority banks. It is important to clarify that this meeting was requested and scheduled on behalf of NBA, not on behalf of OneUnited Bank as press reports suggest. I followed up on the association’s request by asking Treasury Secretary Paulson to schedule a meeting. He recognized that NBA’s concerns about the future of minority banks were valid and arranged for a meeting in early September.
I did not attend the meeting and thus did not participate in the conversation. Press reports of the meeting focus on concerns expressed on behalf of a single bank. However, NBA’s follow up letter to Treasury reiterates the organization’s concerns about the fiscal health of its members generally.
Funds from the Troubled Asset Relief Program (TARP) are distributed to banks requesting assistance by the Executive Branch, not Congress. In particular, the Treasury Department and the Federal Deposit Insurance Corporation (FDIC) decide which financial institutions should receive funds. Treasury officials admit that the decision to distribute TARP funds to OneUnited was based on the merits of the bank’s request, not anything said at the September meeting and not political influence. (Although both my supporters and detractors often refer to me as influential, the truth is that I had no influence on what Bush Administration officials in the Treasury Department or other departments did.)
My husband Ambassador Sidney Williams, who has represented the United States as an Ambassador and has been a respected and active member of the Los Angeles community for many years, was asked to sit on the board of OneUnited Bank. This was the successor to the bank which we had been customers at for many years. He accepted the position and did not accept any director’s compensation for his work on behalf of the bank and the community it serves.
I have fully disclosed all of my financial interests in official filings. These filings included the stock my husband purchased upon joining OneUnited’s board (as required under Massachusetts law, where OneUnited is headquartered). Furthermore, Ambassador Williams is proud to be invested in a minority owned community bank that was given an “outstanding” lending rating from its regulator for its lending activity in underserved communities in Los Angeles, where traditional banks have refused to lend. I even took additional steps beyond what is required of Members of Congress when I voluntarily and publicly disclosed my husband’s relationship with OneUnited during a Financial Services Committee hearing entitled “Preserving and Expanding Minority Banks.” Both the Federal Deposit Insurance Corporation and the Office of Thrift Supervision were present at this hearing.
The federal government has a legal obligation to support minority banks. In particular, Section 308 of the Financial Institutions Reform Recovery and Enforcement Act (FIRREA) insists that the federal government take an active role in the preservation of the number and nature of minority banks.
I maintain that my advocacy on behalf of small, women, minority and community banks is appropriate. I will continue to bank and do business with minority depository institutions and work on behalf of my constituents, and the institutions that serve them.
—MAXINE WATERS
DISCUSSION