the audit

Audit Notes: All-L.A. Times Edition

August 13, 2010

The Los Angeles Times takes a look at OneUnited Bank, which Democratic congresswoman Maxine Waters helped get bailout money and is now facing ethics charges for since her husband was on the bank’s board at the time. And yikes:

The bank has been criticized by regulators in Florida for having an unusually poor record of lending to people in low-income neighborhoods. It also has failed to pay back $12 million in federal bailout funds…

Yet although the bank touts itself as an institution for the underserved, its directors approved paying a reported $26,500 monthly lease for Cohee’s beach house in Santa Monica and providing him the all-expenses-paid luxury sports car — until regulators ordered a halt to such corporate largesse. Waters’ husband, Sidney Williams, served on the board of the bank from January 2004 through April 2008 and owns 3,500 shares of the bank’s stock, according to the House Ethics Committee’s report of alleged violations.

Cohee’s high-flying perks came despite his having been charged in 2007 with felonies after his arrest by the Santa Monica Police Department on suspicion of possessing cocaine, crack cocaine and concentrated cannabis, according to the Los Angeles County district attorney’s office. The case was dismissed the next year after Cohee completed a drug diversion program.

He was also arrested in 2007 after a woman filed a complaint alleging that Cohee had forcibly sodomized her, according to public records. Prosecutors did not pursue the assault charge.

— The LAT scoops that Rupert Murdoch is planning a new national paper—only on the iPad and cellphones.

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Unlike News Corp.’s business-centric Wall Street Journal, the new digital newspaper would target a more general readership, offering short, snappy stories that could be digested quickly. The newsroom would operate under the auspices of Murdoch’s New York Post and be overseen by its managing editor, Jesse Angelo. News Corp. has yet to set a launch date, although people familiar with the matter said the news organization would like it to debut by year’s end.

The LAT also reports that the new “paper” would use Post and Dow Jones reporters but “could” have its own staff of dozens. This one’s worth watching.

— Surprise, surprise! Guess who’s going to come out of the financial-reform fight unharmed?

Goldman Sachs.

Says who? Goldman Sachs.

The LAT reports that the company says the new law will not cause “a significant loss of revenue” for it.

Richard Bove, a bank analyst at Rochdale Securities, said he had changed his view of the law’s effect on Goldman.

“I thought this company was going to be really harmed by this bill; now I’ve figured out that it’s not going to happen,” he said. “They should win big here.”

Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR’s business section. If you see notable business journalism, give him a heads-up at Follow him on Twitter at @ryanchittum.