Tuesday, January 27, 2009

Barney Frank and OneUnited Bank

Barney Frank

Not surprisingly, Rep. Barney Frank (D-MA) is back in the spotlight. This time, the chair of the Financial Services Committee is attracting attention for interceding with the Treasury Department and arranging 12 million dollars in Troubled Asset Relief Program (TARP) funds to be directed to OneUnited Bank of Massachusetts-even though the bank doesn't seem to meet the guidelines for bailing out banks.

This tiny bank in Massachusetts is the only minority-owned bank in the state. The bank's capital has been depleted, and it suffered a loss of $54.3 million from its holding of preferred stock in Fannie Mae and Freddie Mac. It is currently under a cease and desist order from the FDIC for its unsound practices in lending and executive compensation. The bank has been ordered to cut financial ties to a California-based liability company that possesses a beachfront home in Santa Monica worth 6.4 million. The bank also pays for Porsche for the personal use of its president Kevin Gohee.

So why did Frank personally intercede on OneUnited's behalf and steer 12 million to the bank? According to Frank, it would have been tragic if the only black-owned bank in Massachusetts were allowed to fail. He also stated that it was not OneUnited's fault that Fannie Mae and Freddie Mac ran into problems.

It has been reported by the Wall Street Journal (1-27-09) that in addition to Frank, one other member of Congress was contacted by the bank for assistance. That would be Rep. Maxine Waters (D-CA). Just coincidentally, Waters' husband, Sidney Williams, was a director of the bank until this past spring. Just a coincidence, mind you.

However, I am confident that President Barack Obama, in his promised era of change and transparency, will clean up this behind-the-scenes process that is anything but transparent.

Besides, Barney Frank is on the job.


EagleEye said...

Awesome post, Gary. I linked to it in my blog entry about this:

Keep up the great posts.

Gary Fouse said...

Thanks, Eagle Eye. You can bet I will. With people like Barney around, the next story is only a day or so away.

Storm'n Norm'n said...

I see where Uncle is also looking at you...ISP Information Systems, U.S. House of Representatives ...found that on you site meter. They look at me quite frequently along with all the other pals of Pelosi and company.

I never ceases to amaze me how Frank and the others keep blaming Fannie Mae and Freddie Mac when it was Frank and the others in control...and they even gave Obama a few million when they knew they couldn't afford to..