Despite a new House report detailing how lawmakers and their staff appear to have unethically benefitted from a special discount loan program, no efforts were underway by the policing arms of Congress to penalize offending members.
House Oversight and Government Reform Committee Chairman Darrell Issa, R-Calif., has no plans to file an official complaint with the House Ethics Committee against any of the three current House members involved, despite suggesting in a 115-page report he released Thursday that the special Countrywide Financial loans provided to them clearly appear to violate a House rule prohibiting them from receiving gifts.
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“The congressman has always described his intent in this as exposing the facts,” Issa spokesman Frederick Hill explained to The Washington Examiner. “It has long been the practice within Congress for the Ethics Committee to make its own decision about launching an investigation.”
Issa months ago “forwarded” to the ethics panel the names of the lawmakers and staff who received special Countrywide loans, and on Thursday he sent the panel his latest detailed investigation. But unless he files an official complaint, there won’t be a probe unless the typically dormant ethics panel decides to launch one itself.
And that’s not likely.
The Ethics Committee rarely launches inquiries into member misdeeds. And it has been silent about Countrywide since media reports surfaced four years ago about the company’s “VIP” program, which offered easier borrowing criteria, waived points and fees and lowered interest rates for senators, House members and key employees.
The Ethics Committee has the sole authority to mete out punishment against members who violate the rules of the House, including one that forbids them from accepting gifts or the kind of discounts Countrywide provided.
Congressional ethics watchdog groups are not holding their breath for the Ethics Committee to investigate.
“It certainly doesn’t look good when reports come out based on legitimate investigations that show all kinds of special treatment, and not only is there no action, the Ethics Committee doesn’t even take it up,” said Ken Boehm, chairman of the National Legal and Policy Center. “What part of unethical don’t they understand?”
Issa’s report provides a detailed look at how Countrywide’s top lobbyist steered lawmakers and their staff into the VIP program in an effort to dissuade them from regulating their industry.
Countrywide, which was purchased by Bank of America, issued billions of dollars in subprime loans, helping to create a housing market crisis many believe could have been averted with stricter rules and oversight.
The independent Office of Congressional Ethics has also been silent on the Countrywide investigation. The office, which was created to refer potential ethics violations to the House, does not have jurisdiction over the Countrywide matter because the potential wrongdoing began before the OCE was created in 2008.
The Senate ethics committee, meanwhile, looked into the Countrywide loan program in 2009, and found no wrongdoing by Sens. Chris Dodd, D-Conn., the former Senate Banking Committee chairman, who has since retired, and Kent Conrad, D-N.D., the Budget Committee chairman, who is serving his final months in office.
Countrywide gave VIP loans to Democratic Rep. Edolphus Towns, of New York, as well as Reps. Buck McKeon and Elton Gallegly, both Republican congressmen of California. Former GOP Rep. Tom Campbell, of California, was also provided with a special loan.
The members deny knowing they received special deals, but Issa’s report showed the Countrywide loan documents provided to them clearly state “VIP” on the paperwork.
