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March 1 2017

Report: DOJ Was Operating a Shadow Slush Fund for Activists

by Charlotte Hays

Ever wonder where all that money goes when the government settles a federal action against a bank for millions of dollars?

If you thought this money was returned to bank patrons or that the government uses it to pay down the deficit, or to support other government activities, think again.

According to congressional investigators, this money has been going into the coffers of activist organizations. Reportedly, this operation was set up under the aegis of the Department of Justice. Fox reports:

The Obama administration funneled billions of dollars to activist organizations through a Department of Justice slush fund scheme, according to congressional investigators.

“It’s clear partisan politics played a role in the illicit actions that were made,” Rep. John Ratcliffe, R-Texas, told Fox News. “The DOJ is the last place this should have occurred.”

Findings spearheaded by the House Judiciary Committee point to a process shrouded in secrecy whereby monies were distributed to a labyrinth of nonprofit organizations involved with grass-roots activism.

"Advocates for big government and progressive power are using the Justice Department to extort money from corporations,” Judicial Watch’s Tom Fitton told Fox News. “It’s a shakedown. It’s corrupt, pure and simple.”

There is a recent effort by Republicans to eliminate the practice, which many believe was widely abused during the Obama administration.

When big banks are sued by the government for discrimination or mortgage abuse, they can settle the cases by donating to third-party non-victims. The settlements do not specify how these third-party groups could use the windfall.

So far, investigators have accounted for $3 billion paid to “non-victim entities.”

Critics say banks are incentivized to donate the funds to non-profits rather than giving it to consumers.

Tom Franks of the Competitive Enterprise Institute says that DOJ officials have been able to use money from lawsuits to support their favorite causes. Citizens are in the dark about this patronage from DOJ lawsuits.

Sometimes this money goes to government groups that many would like to see curtailed. Congress appropriated $47 million for HUD Housing Counseling, but HUD Counseling received $30 million from Bank of America lawsuit settlements. The Legal Services Corporation received $385 million from Congress but thanks to lawsuit settlements, it will be getting an additional $412 million.

Among the organizations that have received contributions from money raised by federal lawsuits: the National Council of La Raza, the National Community Reinvestment, which, according to a congressional report, promotes illegal immigration, Coalition and the National Urban League. The report raises an interesting question: are some of the groups protesting at town halls being funded from this money? (Just for the record: they have the right to protest but not a right to DOJ funding for their protests.)

Republican Senator James Lankford of Oklahoma has introduced a bill to stop the practice of using what is in effect a slush fund created by lawsuits to fund left-leaning activism. Virginia Rep. Bob Goodlate of Virginia has introduced similar leg Rep. Bob Goodlette of Virginia has introduced similar legislation in the House. Lankford says money from federal settlements should go to the government or to the taxpayer.

 

 

 

 

Independent Women’s Forum’s mission is to improve the lives of Americans by increasing the number of women who value free markets and personal liberty. Sister organization of Independent Women’s Voice.
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