In April 2007 Senator Diane Feinstein (D-CA) resigned as chair of a powerful military appropriations subcommittee. We wrote then and here:

Until last year Feinstein was for six years the top Democrat on the Military Construction, Veterans Affairs, and Related Agencies (or “Milcon”) sub-committee, where she may have directed more than $1 billion to companies controlled by her husband.

During that period 2001-2005 the public record suggests Feinstein knowingly took part in decisions that eventually put millions of dollars into her husband’s pocket — the classic conflict of interest that exploited her position and power to channel money to her husband’s companies.

On the day the new Congress convened this year (2009), Sen. Feinstein introduced legislation to route $25 billion in taxpayer money to a government agency that had just awarded her husband’s real estate firm a lucrative contract to sell foreclosed properties at compensation rates higher than the industry norms.

Mrs. Feinstein’s intervention on behalf of the Federal Deposit Insurance Corp. was unusual: the California Democrat isn’t a member of the Senate Committee on Banking, Housing and Urban Affairs with jurisdiction over FDIC; and the agency is supposed to operate from money it raises from bank-paid insurance payments – not direct federal dollars.

About the same time of the contract award, Mr. Blum’s private investment firm reported to the Securities and Exchange Commission that it and related affiliates had purchased more than 10 million new shares in CBRE. The shares were purchased for the going price of $3.77; CBRE’s stock closed Monday at $5.14.

Spokesmen for the FDIC, Mrs. Feinstein and Mr. Blum’s firm told The Times that there was no connection between the legislation and the contract signed Nov. 13, and that the couple didn’t even know about CBRE’s business with FDIC until after it was awarded.

Sure and pigs fly!

Senate ethics rules state that members must avoid conflicts of interest as well as “even the appearance of a conflict of interest.” Some ethics analysts question whether Mrs. Feinstein ran afoul of the latter provision, creating the appearance that she was rewarding the agency that had just hired her husband’s firm.

“This clearly gives the appearance of a conflict of interest,” said Kent Cooper, a former federal regulator who specializes in government ethics and disclosures.

“To maintain the people’s trust in government, it is incumbent on a legislator to take the extra steps necessary to ensure that when she introduces any legislation that it does not cause people to question her motives or the business activities of her spouse.”

Maintain the people’s trust in government? Are they kidding us? Culture of corruption, Indeed!

The Washington Times offers an 8-page exclusive.

• Read the rate list for the FDIC contract from CB Richard Ellis, the firm Sen. Feinstein’s husband heads as board chairman. (downloads 4-page pdf)

• Read the correspondence between Sen. Feinstein and FDIC chairman Sheila Bair (downloads 5-page pdf )