WASHINGTON -- Bay State Representative Barney Frank urged a Democratic colleague to keep away from a potential conflict of interest involving the Boston-based OneUnited bank, but the congresswoman, California Representative Maxine Waters, didn't heed his warnings, a House ethics panel reported Monday. Waters, whose husband had owned stock in the bank, now faces a possible trial before her colleagues.
The 79-page report by the Office of Congressional Ethics said Waters had confided to Frank that the minority-owned bank was coming to her for help, but that she felt conflicted because of the financial interest of her husband, Sidney Williams. It is against House rules to use one's power as a member for personal financial gain.
"She knew she should say no, but it bothered her,'' the report said, recommending that the House Ethics Committee take formal action.
Waters denied any wrong-doing, saying she was merely trying to help struggling minority-owned banks damaged by the financial crisis. "I simply will not be forced to admit to something I did not do, and instead have chosen to respond to charges made by the House Committee on Standards of Official Conduct in a public hearing,'' Waters said in a statement, referring to the formal moniker for the Ethics Committee.
Frank, who chairs the powerful Financial Services Committee, said in an interview that he advised Waters to let his staff handle any efforts to make OneUnited eligible for Troubled Assets Relief Program (TARP) assistance, since the bank was in his district.
"I said, look, it's a Boston institution. You should stay out of it. It's a legitimate constituency thing for me. You should stay away from this. It's a legitimate thing for me to do, and you shouldn't be involved,'' Frank told the Globe, recounting his conversations with Waters.
Frank said he thought Waters would take his advice, but according to the ethics panel, she did not.
The Newton congressman asked his staff to help make OneUnited eligible for TARP funds, behavior Frank said was appropriate and implicitly sanctioned by the Office of Congressional ethics report.
"I was never a subject of the investigation,'' Frank said, adding that he turned over many documents and e-mails to assist the panel in its inquiry.
Bank officials declined to address the allegations. "OneUnited Bank and its executives cannot comment on the allegations facing Representative Waters before the House Committee on Standards of Official Conduct due to the ongoing nature of the proceedings,'' the bank said in a statement. "The Bank continues to focus on providing critical financial products and services in a responsible manner to the underserved urban communities of Boston, Miami and Los Angeles that have been devastated during the current economic downturn.''
About Political Intelligence
Glen Johnson is Politics Editor at boston.com and lead blogger for "Political Intelligence." He moved to Massachusetts in the fourth grade, and has covered local, state, and national politics for over 25 years. E-mail him at email@example.com. Follow him on Twitter @globeglen.