Finally, Some Details About Maxine Waters' Favorite Bank

Finally, Some Details About Maxine Waters' Favorite Bank

Finally, Some Details About Maxine Waters' Favorite Bank

A blog about business, finance, and economics.
Sept. 10 2010 10:04 AM

Finally, Some Details About Maxine Waters' Favorite Bank

To date, the ethical charges around California Rep. Maxine Waters have been juicy but thin. It's been known for a year and a half that during the TARP-and-bailout days of 2008, Waters went to bat for OneUnited Bank , a financial institution to which she and her husband had financial ties (until April 2008, he sat on OneUnited's board of directors). That's questionable conduct but far from illegal, and given that OneUnited , which calls itself "the first black-owned Internet bank," makes a point of lending in underprivileged communities (including Waters' Los Angeles district), it could be as simple as working on behalf of constituents. Even the release of the House Ethics Committee report and the announcement of formal charges have not moved the blogosphere debate beyond the usual sniping.

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But the Boston Globe moves the ball forward a bit this morning, with fairly damning reporting, not so much about Waters' conduct as OneUnited's . The bank, which is based in Massachusetts, has made all sorts of promises about loaning hundreds of millions of dollars to strapped communities. In fact, says the Globe , even after receiving $12 million in TARP money: "OneUnited Bank remains financially troubled and its plans unclear. Its assets have plunged 18 percent in that time, to $518 million. Total loans on the books have dropped by 13 percent, to $322 million, and few new loans have been made this year." And all those loans to help minorities in Boston? "The bank has made fewer than a half-dozen mortgages in the Boston area since getting bailout funds in December 2008, according to a public records review by the Globe. The largest of those loans went to wealthy developer Cecil Guscott, and to a Dorchester health care agency."

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OneUnited is, of course, not alone in taking TARP money and slowing down lending. But at a minimum, Waters ought to have to answer for the paucity of consumer service that was accomplished her aggressive lobbying.

James Ledbetter is the editor of Inc. and the host of Panoply’s podcast Inc. Uncensored.