The House ethics committee accused Rangel on Thursday of accepting corporate money for trips to Caribbean conferences in violation of House rules. The committee said it couldn't determine whether Rangel knew about the financing, but found that his staff did - and concluded Rangel was responsible for learning the truth.
Ironically, as the ethics committee was finalizing its report, the New York Democrat was attending President Barack Obama's bipartisan summit in an attempt to rescue the party's health care bill.
Rangel's case is certain to raise questions of whether the 20-term lawmaker, chairman of the Ways and Means Committee, can retain his post in an election year.
The Ways and Means chairmanship is especially important this year, when Democrats are trying to overhaul the nation's health care system and Congress has to decide what to do about billions of dollars in tax cuts Americans at every income level have enjoyed for a decade - but are due to expire in December.
If this was Rangel's only ethics problem, it might not be crippling to Democrats. But still looming is a much larger ethics investigation. That one is focusing in part on Rangel's use of official stationery to raise money for a college center in his name; and his belated financial disclosure of hundreds of thousands of dollars in previously unreported assets and income.
The unreported assets included a federal credit union account worth between $250,001 and $500,000; a Merrill Lynch account valued between $250,000 and $500,000; tens of thousands of dollars in municipal bonds and $30,000 to $100,000 in rent from a multifamily brownstone building in New York.
The ethics panel also ended another widespread investigation Thursday, saying it found no violations of House rules by seven lawmakers who steered government money and projects and contracts to favored companies that donated to their re-election campaigns.
In the Rangel case, the ethics committee exonerated five other members of the Congressional Black Caucus who also were on the 2007 and 2008 trips to conferences in Antigua and St. Maarten but told them they will have to pay the costs of the trips.
The panel's report did not include any formal charges that could have brought a more serious censure against Rangel.
Rangel, at a hastily called news conference Thursday night, blamed his staff for his problems.
"Common sense dictates that members of Congress should not be held responsible for what could be the wrongdoing or mistakes or errors of staff unless there's reason to believe that member knew or should have known, and there is nothing in the record to indicate the latter," Rangel said. He refused to answer questions.
House members on the trips who didn't know about the corporate financing, according to the committee, were Democratic Reps. Bennie Thompson of Mississippi, Yvette Clarke of New York, Donald Payne of New Jersey, Carolyn Cheeks Kilpatrick of Michigan and Donna Christensen, the nonvoting delegate from the Virgin Islands.
The ethics committee said the five relied on false information from the listed official sponsors of the trips, the Carib News, a New York newspaper, and the Carib News Foundation.
Peter Flaherty of the National Legal and Policy Center, an ethics watchdog group, attended the 2008 conference in St. Maarten and filed an ethics complaint that listed companies that had signs and materials at the event. He said Citigroup, Pfizer, American Airlines, AT&T, Verizon, Macy's, and IBM were among them.
While lawmakers have attended the Caribbean conferences for many years, the House adopted stricter travel rules before the 2007 and 2008 trips.
Rangel, 79, was first elected to the House in 1970 from New York's Harlem district, defeating Adam Clayton Powell Jr., at the time the most prominent black politician in the country and one with his own ethics problems.
In the case of lawmakers who sponsored targeted appropriations and also received contributions, The Associated Press obtained a copy of letters exonerating the seven along with an accompanying report.
All seven - five Democrats and two Republicans - are or were senior members of the House Appropriations Committee.
The most prominent of the them was the late Rep. John Murtha, D-Pa., the former chairman of the defense appropriations subcommittee who died earlier this month. The other six lawmakers exonerated in that probe are Reps. Norman Dicks, D-Wash.; Jim Moran, D-Va.; Marcy Kaptur, D-Ohio; Peter Visclosky, D-Ind.; Todd Tiahrt, R-Kan.; and C.W. "Bill" Young, R-Fla.
The appropriations went to companies represented by a now-defunct lobbying firm known as PMA Group - formerly Paul Magliocchetti Associates.
The Justice Department was conducting an investigation of its own into PMA. It is unclear whether that inquiry is still alive. At one point, a federal grand jury subpoenaed documents from Visclosky's office, campaign committees and some of his employees. The chief of staff for the Indiana Democrat resigned after the subpoenas were delivered.
The House committee's report said its investigators "found no evidence" that members or their official staffs considered or sought contributions in return for appropriations.
The committee also found that PMA used "strong-arm" tactics, threatening to withdraw financial support or encourage businesses to leave a member's district if the lawmaker opposed appropriations to companies represented by the firm.
"In these instances, members and their staff refused to change their positions and, in one case, notified the (ethics) committee," the report said.