- The Washington Times - Monday, April 27, 2009


The Washington Times on Tuesday published a story by Chuck Neubauer that aimed inaccurate, untrue and unfair suggestions of impropriety at Sen. Dianne Feinstein, California Democrat, and her husband, Richard Blum (“Senate husband’s firm cashes in on crisis,” Page 1). This hit piece distorted the truth in an attempt to cast an ethical cloud over legislation that was designed to help struggling homeowners avoid foreclosure.

Mr. Neubauer twisted some facts - and ignored others - to cast shadows of controversy. It is disappointing that The Times saw fit to print such innuendo, but it’s never too late for a fact check.

Mr. Neubauer framed his story by asserting that the senator’s foreclosure-prevention bill was unusual because she “isn’t a member of the Senate Committee on Banking, Housing and Urban Affairs with jurisdiction over the FDIC.” This is completely and indisputably false. A simple examination of the senator’s legislative record reveals that she often pursues legislation that falls outside the scope of her committee assignments.

In the last session of Congress alone, she introduced: a bill that established national licensing standards for the mortgage industry, although she is not on the Banking, Housing and Urban Affairs Committee; a bill that closed the Enron loophole, although she is not on the Agriculture Committee; a bill that banned harmful phthalates from children’s toys, although she is not a member of the Commerce Committee; a bill to raise fuel efficiency of America’s fleet of vehicles by 10 miles per gallon over 10 years, although she is not a member of the Commerce Committee; a bill to renew trade sanctions against the Burmese junta, although she is not a member of the Finance Committee; and a bill to reduce the tariff on imported ethanol, although she is not a member of the Finance Committee.

So, there is nothing unusual about her bill to provide $25 billion in foreclosure relief to struggling homeowners. Senators commonly pursue bills that are outside the jurisdiction of their committees, according to researchers at the Library of Congress.

The story also insinuates that there is a correlation between the date on which Mrs. Feinstein wrote a letter in support of Federal Deposit Insurance Corp. Chairman Sheila C. Bair’s foreclosure-prevention efforts and the date on which a competitively bid contract was awarded by FDIC career staff to CB Richard Ellis Group, where Mr. Blum is non-executive chairman. But there is a more logical reason why she sent the letter Oct. 30.

That day, the Los Angeles Times ran a front-page story about Mrs. Bair’s proposal, describing it as a plan that could “help millions of families stave off foreclosure.” I presented this article to the senator, who is very concerned with the issue because California has the highest number of foreclosures in the nation, with 837,665 filings in 2008 alone. After reading it, she sent the letter. Coincidentally, an L.A. Times editorial the next day endorsed Mrs. Bair’s plan, calling it a “promising” way to “stave off more foreclosures by offering federal guarantees to lenders that refinance defaulting mortgages.”

At the time, neither Mrs. Feinstein nor her husband had any awareness of CB Richard Ellis’ bid for an FDIC contract to advise the agency on the sales of foreclosed properties. Her support of the Bair proposal was based solely on the urgent need to stem foreclosures. I explained the correlation between the newspaper story and the legislation to Mr. Neubauer, but his story downplays the significance. The story also fails to mention that variations of this proposal passed the Senate by unanimous voice vote.

The truth is that Mrs. Feinstein was not aware of the CB Richard Ellis contract until Mr. Neubauer called me Jan. 21 and I brought it to her attention. There is no conflict of interest - and no connection - between the senator’s foreclosure-relief bill and CB Richard Ellis’ winning a competitively bid contract, which was awarded - unbeknownst to her - by nonpolitical career staff.

Additionally, a bill to prevent foreclosures would not be particularly helpful to a company that was bidding for a contract to sell foreclosed properties.

In any case, President Obama issued an executive order to allocate $75 billion in federal funds for a foreclosure-relief program similar to the Bair plan, rendering Mrs. Feinstein’s legislation unnecessary.

Mr. Neubauer’s story also uses a selective description of the FDIC contract terms in order to make it seem as if CB Richard Ellis received a unique and lucrative deal. But the terms of its contract are similar to those that any other firm could have won in the nine-month-long competitive bidding process.

There is no sweetheart deal, there is no conflict of interest, and there is no story.

Mrs. Feinstein has the highest ethical standards and complies with all requirements of the Ethics Committee. Her legislative agenda is dictated by what she believes is best for the people of the United States and the people of California. Period. Any suggestion to the contrary is inaccurate, untrue and unfair.


Communications director

Office of U.S. Sen. Dianne Feinstein


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