Democrat Dirty Laundry: Dem Rep. Luis Gutierrez Pressured Feds to Save a Bank He Has Close Ties With

Dem Rep. Luis Gutierrez Pressured Feds to Save a Bank He Has Close Ties With

After Receiving $15,000 in Campaign Contributions, Gutierrez Helped Secure a $935 Million Bailout

SPIN CYCLE: Speaker Pelosi Vowed To End a ‘Culture of Corruption in Washington’

“Democrats declare that it is time to end the culture of corruption prevailing through all levels of government. We are committed to immediate change to lead this country in a new direction, to put an end to business as usual, and to make certain this nation’s leaders serve the people’s interests, not special interests. Our responsibility to our constituents and to our nation is to represent all of the people, not just the powerful.” (Nancy Pelosi’s “A New Direction for America, Page 21).

RINSE CYCLE: Dem Rep. Gutierrez Pressed Feds for Cash for a Bank He Has Long Political and Personal Ties With

Rep. Luis Gutierrez (D-Ill.) pressed the federal government at the height of the financial crisis for bailout money for a bank with which he has a long political and personal relationship.

Less than a week after Banco Popular, a Puerto Rico-based bank, asked Gutierrez for help in October 2008, Gutierrez wrote to Henry Paulson, who was Treasury secretary at the time. In an Oct. 20 letter, Gutierrez portrayed the bank as a special case in need of an urgent rescue.

“Obviously, it is in the best interest of the U.S. Government and Puerto Rico that Popular continue providing services to maintain a safe and sound financial system,” Gutierrez wrote in the letter, obtained by The Hill under the Freedom of Information Act.

Left unmentioned was the Illinois Democrat’s long affiliation with the bank and its U.S. operations in particular. Bank executives had contributed tens of thousands of dollars until 2004 to Gutierrez’s political campaigns. The congressman’s wife, Soraida, was a senior vice president at the firm from 2005 to 2007, before being fired.

On Dec. 5, the bank received $935 million from the government, but it continues to struggle. It said Monday it had lost $361 million for the nine months ending Sept. 30, 2009.

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The financial crisis erupted last fall, and Popular recorded a $700 million loss in the fourth quarter alone. The firm had an annual loss of $1.2 billion in 2008.

In October 2008, the bank sent letters to several lawmakers, including Gutierrez, “to ensure participation” in TARP, said Teruca Rullan, senior vice president of corporate communications at Popular. “Communicating directly with members of the U.S. Congress was a prelude to secure capital in this historic financial juncture,” she wrote in an e-mail to The Hill.

Popular was no stranger to Washington’s ways. Gutierrez received close to $15,000 in campaign contributions since 1997 from the bank’s executives, according to the Center for Responsive Politics. The last donation came in 2004. (Kevin Bogardus and Silla Brush, “Gutierrez letter shows efforts to save a bank,” The Hill, 10/20/2009)

To read the full article, click here: http://thehill.com/homenews/house/63809-gutierrez-letter-shows-efforts-to-save-a-bank

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