The House Ethics Committee never fails to disappoint.
Does it seem remotely credible that a sitting congressman would fail to include a loan on his financial disclosure forms because he “lost” the loan documents and didn’t understand that loans had to be reported?
Sure, the forms include instructions explaining that loans must be reported and no, the congressman had never made a single payment on the loan. But those details didn’t stop the House Ethics Committee from absolving Rep. Gregory Meeks (D-Queens) of any wrongdoing last week.
In June 2010, Meeks admitted that over three years he had obtained two loans totaling $55,000 but had failed to report them on his personal financial disclosure forms, including a $40,000 loan he had accepted from Queens businessman Edul Ahmad in 2007.
Apparently, Meeks received a check for $40,000 from Ahmad in January 2007 to help with costs associated with his new $830,000 home. It seems Meeks took the money without any discussion of interest rates, due dates or collateral requirements for the loan, which might suggest the payment really was more of a gift.
Further, Meeks made no payments on the loan until June 2010, after the FBI questioned Ahmad, at which point Meeks suddenly rushed to find a way to repay Ahmad. When questioned about the money, Meeks told a reporter he needed it “for my family obligations, etc. I was in a new house. It’s taking care of things for my family needs in the house. You need to make sure the house is furnished. You need things.”
While members of Congress are not prohibited from seeking loans from friends, they must ensure such loans are made on commercially reasonable terms and they are to seek ethics committee approval before accepting the money. Meeks never sought the committee’s approval.
Once the ethics committee began investigating, Meeks claimed the loan was made at a reasonable rate, to be repaid within 10 years, but he “lost” the agreement. He also claimed he had chosen to repay the loan in June 2010. In Meeks’ telling, his full repayment of the $40,000 was unrelated to FBI asking questions.
In order to repay the loan quickly, Meeks was forced to go to another friend, Dennis Mehiel, a New York businessman and a longtime Democratic donor. Mehiel told the House Office of Congressional Ethics that Meeks asked him for a loan in June 2010 to pay back the existing $40,000 loan. Mehiel reported Meeks needed the money quite quickly because a House financial disclosure form was due. He also said Meeks’ lawyers felt compelled to pay the original lender a high interest rate — 12.5% — so Meeks would not be seen as getting a benefit.
Ahmad, who pleaded guilty in connection with a $50 million mortgage fraud scheme, declined to testify before the House Ethics Committee, concerned about incriminating himself, but his lawyer told committee staff that there was no loan agreement or fixed interest rate.
The House Ethics Committee ignored Meeks’ failure to report the loan, the missing documents, the timing of the repayment, and Mehiel’s recollections. It also discounted the statements of Ahmad’s lawyer, finding it all came down to a “swearing contest” between a member of Congress and “a person who has pled guilty to conspiracy to commit bank and wire fraud, and is awaiting sentence.” In the committee’s view, that’s no contest at all.
Any objective observer, however, would find the circumstances of the loan suspicious enough. The fact that Meeks failed to report it, as required, and then allegedly “lost” the documentation, should be sufficient to persuade even the most skeptical. In addition, who has more reason to lie about this, Meeks — who could face criminal liability as well as action by the House — or Ahmad, who already has been indicted?
Only the House ethics committee would accept the sort of pathetic “dog ate my homework” excuse more appropriate to a middle school student than an elected official. Last summer, a Gallup poll indicated Americans were more concerned about ethics of government officials than about any other issue except jobs.
Based on the Meeks’ report, it seems Congress didn’t get the message.
Melanie Sloan is the executive director for Citizens for Responsibility and Ethics in Washington.