Skip to content

Ethics Committee Details ‘Lessons Learned’ From Maxine Waters Case

Updated: 5:48 p.m.

The stand-in members of the House Ethics Committee handling the conflict-of-interest probe of Rep. Maxine Waters formally cleared the California Democrat today and, in doing so, recommended that the committee note “lessons learned” and take additional precautions to avoid partisan behavior.

A statement that the members had voted unanimously to clear Waters and to issue a letter of reproval for her grandson and Chief of Staff Mikael Moore included nine recommendations for the general House community. Five concerned avoiding the existence or appearance of partisanship within the Ethics Committee and four, including avoiding the hiring of grandchildren, were aimed at minimizing the chance for future conflicts of interest within House offices.

“It is our recommendation for any Member that serves on this Committee that he or she constantly evaluate their actions on the Committee, to ensure that they are living up to the highest standards,” acting Chairman Bob Goodlatte (R-Va.) and acting ranking member John Yarmuth (D-Ky.) wrote.

“We believe that the full Committee, or the House, should consider adopting policies that recognize that employer/employee relationships with grandchildren can be just as fraught with risk as other familial relationships in the workplace,” the statement’s recommendations concluded.

The statement was accompanied by the substitute committee’s report, the findings of an outside counsel brought in to assist in the matter, a report on the matter from an independent ethics office and a letter of reproval for Moore. The release of the documents concluded a case that has spanned three years and two Congresses.

The committee last week held a rare public hearing at Moore’s request and said in its report that it had “considered his testimony before reaching the Committee’s conclusion.” Moore declined to comment on the case after today’s statement.

Waters’ exoneration paves the way for her to pursue the top Democratic slot on the Financial Services Committee when ranking member Barney Frank (Mass.) retires at the end of this Congress.

The Waters probe began in the independent Office of Congressional Ethics, which in April 2009 began reviewing allegations that the 11-term lawmaker had asked Treasury Department officials to meet with representatives from the National Bankers Association. The office, which acts as a fact-finding body that refers its findings to the Ethics Committee for conclusion and action, focused on the group’s discussion of assisting OneUnited Bank, given that Waters’ husband had a financial stake in the financial institution and had previously served on its board.

In July of that year, the office voted to send the matter to the committee for further investigation. The committee formed an investigative subcommittee to look into the case, and the next spring it agreed to release a report that criticized the conduct in the case but not recommend any sanctions. The committee’s chief counsel and staff director at the time, however, advised that they could not publish a report that criticized a Member without giving them a chance to respond in a hearing.

The investigative subcommittee instead adopted a “Statement of Alleged Violation” that described three possible counts of misconduct against Waters. Waters held a press conference in which she disclosed information about the matter that was subject to a nondisclosure agreement. Then-Ethics Chairwoman Zoe Lofgren (D-Calif.) advised Waters in writing to adhere to the agreement. The back-and-forth caused relations within the committee to disintegrate.

“At this point, based on numerous interviews and documents reviewed, it is clear that members of the staff, particularly the two senior staff members on the Waters [adjudicatory subcommittee] team, began disagreeing with certain decisions made by the former Chair and began communicating with Republican Committee Members regarding their frustrations,” the independent counsel’s report released Tuesday said.

Internal committee documents about these concerns were later published in Politico. The exchanges showed that the committee’s staff director at the time believed that the staffers’ communications had likely compromised the Waters investigation.

Waters said the documents were evidence that her due process rights had been violated and that the committee’s case against her should be dropped. In July 2011, the committee brought on litigator Billy Martin as an outside counsel. Martin was asked to examine whether committee members and staffers had acted in a way that improperly affected the Waters case before deciding whether it could proceed.

The committee announced in February that six of its members had voluntarily recused themselves from the Waters case at Martin’s recommendation. Republican Reps. Mike Simpson (Idaho), Steven LaTourette (Ohio), Shelley Moore Capito (W.Va.), Tim Griffin (Ark.) and Goodlatte, as well as Democratic Rep. John Sarbanes (Md.) served on the committee that considered Martin’s findings, along with Democratic Reps. Yarmuth, Donna Edwards (Md.), Pedro Pierluisi (Puerto Rico) and Joe Courtney (Conn.), who are permanent members of the committee.

In June, the committee announced that Martin had found no indication that the case had been mishandled to an extent that deprived Waters of her right to a fair hearing. At that point, with the first phase of his review complete, Martin moved onto the “substance” of the allegations that had been made against Waters. His review included 150,000 pages of documents and numerous interviews. The length of the total investigation was exacerbated by the “significant number of motions and complaints” raised by Waters, the “complicated task” of tracking legislative efforts made by staffers and offices and the “breakdown of communications” among committee members in the last Congress, according to the report released by the committee.

“Outside Counsel recommended that the Committee find that the evidence here does not establish that Representative Waters violated House rules … it appears that Representative Waters recognized and made efforts to avoid a conflict of interest with respect to OneUnited,” the report said.

Martin’s findings set the stage for last week’s hearing and the committee formally clearing Waters of wrongdoing today.

“The Waters Committee finds that Representative Waters took at least three steps to inform her [chief of staff] of her conflict of interest with respect to OneUnited and to prevent the [chief of staff] from acting on that conflict,” the committee’s report said.

“While Outside Counsel did not determine that the [chief of staff]’s efforts ultimately benefitted OneUnited, the House rules do not permit a Member or their staff to take specific actions that would, if effective, accrue to the financial benefit of the Member. The Waters Committee finds that Representative Waters’ [chief of staff] violated House rules,” the committee’s report concluded.

Emma Dumain contributed to this report.

Correction: Sept. 25, 2012

A earlier version of this article incorrectly stated the day of the committee’s announcement. It was Tuesday.