Feinstein Accused of Self-Dealing in $25 Billion Legislation for FDIC

Sen. Diane Feinstein (D., Ca.) is embroiled in an expanding controversy over her introduction of legislation to give $25 billion to the Federal Deposit Insurance Corp that awarded a highly generous contract to her husband. Feinstein is notably not on any committee with jurisdiction in this area and this legislation was unusual for her. The scandal, once again, shows the calculated decision of Senators to preserve loopholes that allow them to invest or have interests in areas where they legislate and vote.

I have written repeatedly about how members of Congress have made themselves rich by investing in areas where they vote or legislate, click here. In this case, Feinstein suddenly decided to send $25 billion to the FDIC after her husband’s real estate firm was given a lucrative contract to sell foreclosed properties. She offered the measure on Oct. 30th only days after the agency gave the CB Richard Ellis Group (CBRE) – the firm headed by her husband Richard Blum.

For civil libertarians, the week has been something of a windfall. Jane Harman and Feinstein are blamed for blocking efforts to investigate unlawful surveillance and torture –programs that they reportedly knew about for years before made public. Now, Harman is facing a potential criminal allegation and Feinstein is tied up in a financial scandal.

Feinstein has a legitimate argument under the ethics rules in the Senate which were written to clear Senators rather than deter Senators from conflicts of interests. While there is an obvious appearance of a conflict of interest, the toothless standard could not gum a Senator engaged in the both flagrant acts of self-dealing.
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