The House banking scandal broke in early 1992, when it was revealed that the US House of Representatives allowed its members to overdraw their House checking accounts without the risk of being penalized by the House bank, which was actually a clearinghouse.
The scandal is sometimes called Rubbergate, a Watergate portmanteau with rubber, as in bounced, check. This is a misnomer, as House checks were honored through institutional overdraft protection, with its Sergeant at Arms ensuring payment without penalty.
The scandal contributed to a perception of corruption and malfeasance and was a contributing factor to major changes in the House in which 77 Representatives resigned or were ousted by the 1994 elections.
External links
- House Banking Scandal CongressionalBadBoys.com. List of the 22 worst, as identified by the House Ethics Committee