The House Ethics Committee Sends A Message: “Keep Your Corruption Within The Loopholes, And You’re Still ‘Ethical'”

"We just want to be friends."

“We just want to be friends.”

Let us stipulate that when a body’s ethics committee shows itself to be hopelessly confused about ethics, the chances that the body it is supposed to enlighten will be anything other than habitually, shamelessly and irreparable unethical are somewhere between Frosty’s chances of surviving in Hell, and the likelihood of me doing an infomercial for Wen Hair.

Remember the “Friends of Angelo” scandal? This was the so-called  “VIP program” that former Countrywide founder and CEO Angelo Mozilo used, not to be unkind, to bribe lawmakers into assisting Countrywide’s predatory mortgage loan practices, or at least to look the other way. In June 2008  it was revealed that key policy makers, including former Senate Banking Committee Chairman Christopher Dodd  (D-Conn.), and current Senate Budget Committee Chairman Kent Conrad (D-N.D.) received special terms on mortgages from Countrywide.

In 2009,the House Oversight Committee began investigating the program and learned that similar sweetheart loans were extended to almost a dozen lawmakers, executive branch officials, and other employees of Congress, the White House, Fannie Mae, Freddie Mac, and other government agencies. Countrywide also allowed some VIP program participants “free floats,” which meant that if interest rates fell during the time when loans were being processed, the company allowed applicants to take the lower rate at closing, something it does not typically do.

Let’s be clear: these are bribes. No matter whether they fall within or without specific laws or regulations, they are bribes. This is a large corporation providing special benefits to legislators and others in the government that it did not make available to the general public, in order to make “friends” with them. Why would a financial company like Countrywide want policy-makers indebted to it, to “like” it? Use your imagination. This is called creating a conflict of interest and warping independent judgment. We should expect our officials and elected representatives to recognize such transparent corruption, and avoid it. But they didn’t, and don’t.

One reason they don’t is that voters refuse to hold them accountable. Another is this:

From the LA Times:

“The House Ethics Committee has found no rules violations by  lawmakers and staffers who used a VIP loan program from Countrywide Financial Corp. saying the allegations of special treatment fell outside the panel’s jurisdiction. The committee’s leaders said its investigation largely led to the same conclusions as the Senate Ethics Committee, which determined in 2009 that there was “no substantial credible evidence” that Sen. Kent Conrad (D-S.D.) and former Sen. Christopher Dodd (D-Conn.) had broken rules by accepting loans through the special program…”

“The House Ethics Committee statement said that people in the VIP program appeared to be offered ‘quicker, more efficient loan processing and some discounts.’ But the committee said there was evidence showing those discounts “were not the best deals that were available at Countrywide or in the marketplace at large.” Because participation in the program “did not necessarily mean that borrowers received the best financial deal available either from Countrywide or other lenders,” it was not a violation of House rules to participate, according to the Ethics Committee.”

What you see, I hope, in that last statement, is an outrageous rationalization. If I am the owner of a Lexus dealership, and I give an under-the-table discount to a zoning board member who will be voting on the re-zoning petition that will allow me to open a new dealership in an affluent residential area, is it any less of a bribe if the board member could have received as good a deal if he had gone to Mad Irving’s Crazy Discounts Lexus in the neighboring town? Of course not. It is a bribe because the recipient of a financial benefit knows that he is being given something of value as personal favor, with the expectation of a favor in return because of the circumstances surrounding the gift. If the House ethics rules don’t regard accepting such gifts as unethical, it is because they were intentionally drafted to allow members to get away with doing so. It is unethical. It creates a quid pro quo understanding, and that is exactly what such discounts are intended to do, and have been designed to do for centuries.

While declaring that no sanctions would be forthcoming, members of the Ethics Committee helpfully cautioned that in the future, if a lawmaker or staffer believes there may be “an explicit connection between their position and some personal business transaction,” they should “take steps to ensure they are being treated no differently than a member of the public.” Oh, good point! I’m sure House members never thought of that before, and if they didn’t, they are too ethically ignorant to be trusted in the positions they hold.  House Oversight Committee chair Darrell Issa then said, comfortingly, that although the Ethics Committee took no action, its statements “clearly indicated that Countrywide’s efforts were inconsistent with House rules.”

“While short of formally determining a violation, this sends an unmistakable warning to any entity that might try to duplicate Countrywide’s lobbying strategy,” Issa said.


The real message is that corrupt government officials can keep accepting favors, goodies and bribes in the form of discounts and deals, because the rules give them loopholes to do so, and that “ethics” in Congress really means “figuring out a way to be corrupt without breaking any laws or rules.”


Sources: LA Times, CNN

Graphic: CNN

Ethics Alarms attempts to give proper attribution and credit to all sources of facts, analysis and other assistance that go into its blog posts. If you are aware of one I missed, or believe your own work was used in any way without proper attribution, please contact me, Jack Marshall, at


5 thoughts on “The House Ethics Committee Sends A Message: “Keep Your Corruption Within The Loopholes, And You’re Still ‘Ethical'”

  1. As a result, Kent Conrad is still a U.S. Senator and the “disgraced” Senator Dodd is now head of the Motion Picture Academy of Arts… essentially King of Hollywood! After Dodd’s previous career of political criminality, who else would have been better suited to take up where Jack Valenti (another depraved crook of note) left off?

    • I don’t see it that way. The Committee easily could have found that the rules, as written, were broken. There are rules against failing to avoid the appearance of impropriety, broadly stated, right now. The reason given for not finding a violation is the lamest of excuses.

      • Plus, I don’t think any rule can specifically be written to define a ‘bribe’ in order to allow discernment between what is and what isn’t a bribe?.

        The rule must be broad because determining a bribe is purely based on the appearance of the action taken and a judgment call of those constituted to make such judgements.

        More stringent rules defining what could be considered a bribe would only serve to show future miscreants exactly how they need to conceal their behavior in the future in order for it to ‘pass the test’.

        • Additionally, such stringent definition of what may constitute a bribe, may inadvertently cause several interactions, which were otherwise completely benign, to now be considered bribes.

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