A congressional investigation has revealed that the Obama administration channeled billions of dollars to activist groups through a Department of Justice slush fund scheme.
“It’s clear partisan politics played a role in the illicit actions that were made,” Republican Representative John Ratcliffe of Texas told Fox News. “The DOJ is the last place this should have occurred.”
The House Judiciary Committee discovered a secretive process in which funds were dispersed to a web of nonprofit organizations engaged in grass-roots activism.
“Advocates for big government and progressive power are using the Justice Department to extort money from corporations,” said Judicial Watch’s Tom Fitton. “It’s a shakedown. It’s corrupt, pure and simple.”
The practice is believed to have been widely abused throughout the Obama administration. The Republicans have launched a recent effort to eliminate the scheme.
When big banks are sued by the federal government for unlawfulness, such as discrimination or mortgage abuse, they are allowed to settle the cases by donating to third-party groups that were not victims of their wrongdoing. There are no guidelines regarding the use of the money received by the third-party groups.
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To date, investigators have discovered that $3 billion has been paid to “non-victim entities.”
Critics assert that banks are offered incentives to donate the funds to non-profit groups instead of returning it to consumers.
“The underlying problem with the slush funds is we don’t know exactly where the money is going,” said Ted Frank, director of The Competitive Enterprise Institute Center for Class Action Fairness. “Using enforcement authority to go after corporate defendants, DOJ bureaucrats are taking billions away from taxpayers to fund their pet projects overriding congressional preferences.”
Frank claims that the Treasury Department should get the funds and that the practice subverts the legislative branch’s spending power. But the Government Accountability Office and Congressional Research Service have found that settlement agreements do not violate Congress’ rights.
Frank disagrees. “This is real abuse of power,” he said.
Funds were found to be funneled to left-leaning organizations such as the National Council of La Raza, the National Community Reinvestment Coalition (NCRC), and the National Urban League.
A Senate majority staff report released last year from the Committee on Homeland Security and Government Affairs cited the NCRC’s “checkered history” of promoting “illegal immigration and advocating for benefits and driver’s licenses for undocumented immigrants.”
Legislation to quash the practice faltered last year, but lawmakers are now pushing the effort to end the scheme with companion bills in the House and Senate.
“Democrats thought it was an attack on Obama,” said Republican Senator James Lankford of Oklahoma who has introduced the Stop Settlement Slush Fund Act of 2017. “This is not a Republican or Democrat issue, but one of good government. Actions settled by the federal government should go back to the federal government, back to the taxpayer.”
House Judiciary Chairman Bob Goodlatte, a Republican from Virginia, submitted similar legislation in the House.
“Congress must permanently end the abuses Obama’s Justice Department exploited to use settlements to funnel money to their liberal friends,” Goodlatte said.
Judicial Watch’s Fitton is eager to see the shadow subsidy scheme come to an end. “There is a massive left-wing infrastructure in place trying to protect the monstrous government created by the Obama administration.”
H/T: Fox News
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