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Blowing the whistle on ACORN

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By Michelle Malkin  •  June 20, 2008 10:01 AM

The radical left-wing, government-subsidized group ACORN uses your tax dollars to engage in voter fraud, enrich itself as part of the mortgage counseling racket, and serve as an activist branch of the Democrat Party.

There’s more. Ashley Eiler e-mails about a new report: “The Consumers Rights League just released a collection of whistleblower documents from an ACORN staffer that raise some new concerns about how the organization has established policies for its housing counselors to use undocumented / under-the-table income for processing loan applications from low-income individuals. In addition to pushing these and other exotic loans, the documents reveal that ACORN has engaged in some apparently illegal activities by commingling government funds from its tax-exempt offshoot entities to fight political battles against corporate lenders. ”

Which one again begs a nagging question I’ve asked before: Why do Republicans continue to abet their political enemies and allow public money to be funneled to these con artists?

How your money is being spent (the full report is here - PDF):

Despite raking in a troubling 40 percent of its revenue from taxpayers over the last three years, ACORN Housing Corporation’s actions range from controversial to borderline illegal:

• AHC has worked to obtain mortgages for illegal aliens
• AHC relies on undocumented income, “under the table” money that may not be reported to the Internal Revenue Service
• ACORN’s “financial justice” operations attack lenders for “exotic” loans, but AHC has recommended ten-year interest-only loans (which deny equity to the buyer) and reverse mortgages (which can be detrimental to senior citizens)
• AHC may have violated federal law by failing to maintain a proper distinction between its tax-exempt housing work and the aggressive political activities of ACORN

More:

The ACORN Housing Association (AHC), an ACORN affiliate that receives over 40% of its funding from government sources, claims to be a consumer advocate. In a newly-released report from CRL, however, a series of documents obtained from a whistleblower source reveals hypocritical and potentially illegal use of taxpayer dollars by ACORN and its related organizations. These documents – which include staff emails and internal organization policies – suggest that ACORN has failed to maintain a proper distinction between its tax-exempt housing work and its aggressive political activities.

“ACORN and its offshoots take in millions of dollars in government grants under the guise of ‘consumer advocacy’ to line their own pockets. Attacking financial institutions for ‘predatory’ loan practices and then turning around to form cozy relationships with the same corporations sounds more like extortion than advocacy for low-income families,” said Jim Terry, CRL’s Chief Public Advocate. “The public deserves answers about how organizations funded by their tax dollars are functioning, particularly at a time when the Congress is considering pumping hundreds of millions of dollars into their budgets.”

According to the internal documents obtained by CRL, this potentially illegal practice of commingling funds occurs when AHC, ACORN’s tax-exempt offshoot, spreads government grant funds among various related entities to be used for political gains. Through targeted public relations assaults, ACORN is able to extract resources from financial lenders seeking abatement and to force financial settlements that benefit ACORN but are harmful to consumers.

Even as ACORN attacks other lenders for engaging in “predatory” tactics, the organization’s housing affiliate offers consumers the very same types of exotic loans, including 10/40 interest only mortgages (which prevent buyers from building equity during the first 10 years of a loan) and reverse mortgages (which can be detrimental to senior citizens). ACORN’s pay-to-play attack model has become so pervasive that in one internal email, a staffer writes that lenders view the forced deals with ACORN “as a cost of doing business.”

The CRL-issued report also raises concerns about ACORN’s role in the industry-wide relaxation of credit and the decline in mortgage lending standards that are at the heart of the current housing downturn. One email obtained from CRL’s whistleblower source reveals AHC’s use of suspect lending practices to help potential homebuyers obtain mortgages. In particular, one internal document outlines an AHC policy that advises its housing counselors to use “under-the-table” income – earnings that are typically not reported to the IRS – to process mortgage applications for low-income and minority homebuyers.

“The fact that AHC is counseling low-income consumers to take the very same loans it labels as ‘predatory’ is more than troubling,” said Terry. “It is important for homebuyers seeking AHC’s advice to understand ACORN’s true motives, and for American citizens to know how their money is being spent. This report raises some serious questions that deserve a great deal of scrutiny by consumers and taxpayers alike.”

Hello, GOP? Anyone home?

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