April 21st, 2009, Fairfax, VA—Americans for Limited Government President Bill Wilson today called upon the Senate Ethics Committee to investigate Senator Dianne Feinstein (D-CA) “to ensure that government contracts are not being awarded as part of a sleight-of-hand pay-to-play scheme using taxpayer money.”
The Washington Times has reported that Senator Feinstein offered on October 30th, 2008 to secure funds for the Federal Deposit Insurance Corporation (FDIC) just days before the agency awarded a three-year contract to CB Richard Ellis (CBRE), a company run by Feinstein’s husband, Richard Blum.
The Feinstein bill provided the FDIC with an unusual direct grant to expand its mortgage modification and loan guarantee programs. Mr. Blum’s contract with the FDIC could ne him hundreds of millions of dollars in sale of foreclosed properties held by the FDIC.
“The Senate Ethics Committee needs to investigate this apparent conflict of interest of Senator Feinstein immediately,” said Wilson. “They must ensure that this government contract was not awarded in return for the Senator introducing legislation favored by FDIC Chairman Sheila Bair.”
According to the Times story, “The proposal was a pet project of FDIC Chairman Sheila C. Bair.” Feinstein ultimately introduced the legislation on January 6th, 2009, totaling $25 billion in an unusual direct allocation to the FDIC, which usually operates by raising money from bank-paid insurance payments.
Feinstein’s unusual move came directly on the heels of her husband receiving a highly lucrative FDIC contract. By March, the FDIC had assigned CBRE 507 foreclosed properties to be sold, worth $221.7 million. It already has under contract to be sold more than $11 million worth of properties.
“While the Senate considers legislation offered by Senator Feinstein to funnel money to the FDIC, what it should really be considering is whether she did so because her husband is doing profitable business with the FDIC,” said Wilson.
Both Feinstein and the FDIC have denied there was any pay-to-play corruption involved. “That should be for the Senate Ethics Committee to determine,” Wilson said, reminding the committee of its responsibility to investigate “even the appearance of a conflict of interest.”
“The culture of corruption in Washington, epitomized by what appears to be a pay-to-play conflict of interest, will only be brought under control when the legislators involved are brought to account,” Wilson concluded.
Interview Availability: Please contact Alex Rosenwald at (703)383-0880 or at email@example.com to arrange an interview with ALG President Bill Wilson.