The Senate Ethics Committee released two letters (Dodd, Conrad) today clearing Sens. Chris Dodd and Kent Conrad of ethics violations in a case where both senators were members of a Countrywide “VIP” loan program. These letters concluded a year-long investigation into the “VIP” program and the loans the senators received.
The Committee found that the two senators did not violate Senate ethics rules prohibiting members from accepting outside gifts. The rule in question does not cover “loans from banks and other financial institutions on terms generally available to the public.” The committee also ruled that while the “VIP” loans did offer “quicker, more efficient loan processing and some discounts,” the discounts provided “were not the best deals that were available at Countrywide or in the marketplace at large.”
The senators did receive a chiding for not exhibiting care in their dealings with Countrywide. The Committee told both senators that they “should have excercised more vigilance in [their] dealings with Countrywide in order to avoid the appearance that [they] were receiving preferential treatment based on [their] status as Senator[s].”
In response to the investigation that Committee declared that it should have issued guidance on the receipt of loans and the involvement of senators in special loan programs. The Committee expects to issue a guidance to members in the future.
The organization that filed the initial ethics complaint, Citizens for Responsibility and Ethics in Washington (CREW), stated in a blog post that this amounts to “battered wife” syndrome.
“Like a battered woman who explains she brought the beating on herself, the committee faulted itself for failing to ‘provide more guidance to the Senate community about issues surrounding mortgage negotiations.’ Over a year has passed since CREW filed its complaint and the committee became aware of this issue. Now would be a good time for the committee to start proactively providing its promised advice.”
The Ethics Committee could also review legislation that has been introduced requiring limited disclosure of home loan information on personal financial disclosure forms (S. 1632).