First there was “Countrywide Chris” Dodd (D-Conn.), whose combination of poor judgment and possible corruption qualifies him to be Chairman of the Senate Banking Committee. Then there was Tim “TurboTax” Geithner, whose false tax return filings qualify him to be Secretary of the Treasury. And now, in keeping with the Democrats’ recent tendency to have scoundrels in the highest positions involving regulation of the nation’s finances, we have the Chairman of the tax-writing House Ways and Means Committee, Charlie Rangel (D-N.Y.), who recently filed amended financial disclosure reports showing a net worth about double what he had previously reported. (Rangel’s original 2007 disclosure form and the amendment can be seen here in pdf form.)
In addition to showing his net worth increasing from a range of $516,015 and $1,316,000 to a range of $1,028,024 to $2,495,000 in his amended 2007 financial disclosure form filed last month, Rangel also reported substantial 2007 income and several transactions involving mutual fund sales, purchases, and exchanges which he had not disclosed earlier. The new numbers are not small, especially as a percentage of Rangel’s total net worth.
For example, while Rangel was reporting net worth in the area of $1 million, he “overlooked” two accounts worth over $250,000 each (one checking, one mutual fund), another bank account, several other mutual fund accounts, and holdings of stock and land totaling another roughly $300,000. In other words, Rangel’s unreported assets were worth about as much as his reported assets.
According to the Sunlight Foundation, “Rangel failed to report purchases, sales or his ownership of assets at least 28 times since 1978 on his personal financial disclosure forms. Assets worth between $239,026 and $831,000 appeared and disappeared with no disclosure of when they were acquired, how long they were held or when they were sold, as House rules require.”
And while Rangel offered a weak excuse of having delegated the completion of these forms to his staff, there is reason to be suspicious that the omissions were unintentional or unexpected. Two of Rangel’s top aides — who serve as staffers to the Ways and Means Committee — also recently filed financial disclosure amendments going back to 2002 and showing previously unreported rental and business income, with one of those aides, George Dalley, failing to report over $200,000 in income over a 4-year span.
Rangel’s public trouble with numbers started well before these disclosure issues. In 2008, Rangel was found to be renting four rent-stabilized apartments in Upper Manhattan in violation of state and city regulations, paying a total rent of about half of the “fair” market rates. The New York Times reported last July that the landlord, the Olnick Organization has “been accused of overzealous tactics as they move to evict tenants from their rent-stabilized apartments and convert the units into market-rate housing… Yet Mr. Rangel, a critic of other landlords’ callousness, has been uncharacteristically reticent about Olnick’s actions.”
Shortly afterwards, it was widely reported that Rangel earned “more than $75,000” in rental income from a villa he owns in Punta Cana in the Dominican Republic — income that was not only “overlooked” on his Congressional financial disclosures but also on his federal and state tax returns. The National Legal and Policy Center (“NLPC”), a watchdog group that has uncovered much of Rangel’s wrongdoing, says they “were puzzled that the media simply accepted Rangel’s figure of $75,000 when it appeared the total was much higher.” In his original 2007 disclosure form, Rangel reported zero income from the Punta Cana property, but the amended filing shows between $5,001 and $15,000. For these errors he first blamed his wife and then his inability to speak Spanish.
The NLPC also found that Charlie Rangel had illegally claimed homestead exemptions (to reduce property taxes) in both Washington, D.C. and New York simultaneously.
These issues and more are currently before the House Ethics Committee for investigation. “How could there be more?” you might ask. Here are just a couple other items: Rep. Rangel parked a 1972 Mercedes in a House of Representatives parking lot for several years in violation of House rules…probably a tax code violation as well for not reporting the value of the parking space as income. He spent about $80,000 of campaign funds over less than 4 years on “cheap-looking and shoddy” websites run by his son, stopping the payments only after his son was given an $80,000 annual salary to work for the House Energy and Commerce Committee. All possibly legal, but certainly unethical.
Rangel impermissibly used official congressional letterhead to solicit donations to the Charles B. Rangel Center for Public Service at the City College of New York. Also, it appears he helped pass a tax loophole for a corporation while asking the corporation’s CEO for a donation to the Center. According to Citizens for Responsibility and Ethics in Washington, by no means a conservative group, Rangel “may have committed bribery, deprived his constituents of his honest services, and accepted an illegal gratuity.”
And just days ago, it was reported in the New York Post that “Rangel reported no rental income for eight years on his rundown Harlem row house, even though public records show tenants were living there.” The NY Post article describes years of chaotic swings of income reporting, non-reporting, and amendments.
The House Ethics Committee’s investigation has been dragging on for a year. On one hand, each passing month seems to give the committee some other Rangel malfeasance to look into. Yet one wonders why there are not at least interim findings when the subject is the legislator with the single greatest ability to influence the tax code.
In 2008, the House tabled a resolution brought by Republican leader John Boehner (R-Ohio) to reprimand Rangel for “dishonoring himself and (bringing) discredit to the House.” According to news reports, at least 25 Republicans voted against the resolution. But with the continued flow of information about Rangel’s ethical lapses, Boehner has now called (pdf) on his friend to give up his position as Chairman of the Ways and Means Committee because “trust is everything.” Reached for comment for this article, a spokesman for Boehner suggested that “given the staggering array of ethics allegations he faces, Chairman Rangel really has no choice but to give up his gavel at the powerful Ways and Means Committee.”
Even the Washington Post is now calling for Rangel to step down, a full year after the New York Times called for him to do so “while his ethical problems are investigated.” However, Charlie Rangel seems in no mood to give up the gavel and Nancy “Culture of Corruption” Pelosi is saying she will not remove Rangel from his chairmanship unless the Ethics Committee finds a violation or a prosecutor charges him with a crime.
In the meantime, the committee that writes our tax code will be operating under a cloud, with citizens wondering just what sort of double-dealing may be happening right under our noses, guided by the shifty hand of Charlie Rangel. After all, as the Sunlight Foundation’s Bill Allison notes dryly, “It makes people suspicious when all of a sudden you double your wealth.”
Cartoon by Brett Noel.