President Joe Biden was just nailed in a sneaky corporate scandal…
(washingtonexaminer) – The Biden administration is trying to revive a form of thoroughly corrupt, politicized shakedowns. Thankfully, Sen. Tommy Tuberville is trying to stop them.
The shakedowns were a favorite tactic of the Justice Department under the Obama-Biden administration, but they had been stopped under former President Donald Trump. On Joe Biden’s first day as president, he ordered the department to “review” the policy with an eye toward reinstating it. Tuberville, a Republican from Alabama, on Wednesday introduced the “Stop Settlement Slush Funds Act of 2021” to block him.
The scheme used under Obama was clever but nefarious. The Justice Department would target wealthy entities, often banks, for some sort of “enforcement action” for alleged misdeeds. With the targeted outfit facing the full weight of the government’s virtually limitless legal budget (not to mention compulsory powers), it would often calculate the situation as being less expensive to pay a hefty, but not unmanageable, penalty than to battle the government all the way to a final verdict.
Department officials, though, would not merely deposit the payments into the U.S. Treasury or forward them to individuals or groups directly harmed by the alleged malfeasances. Instead, they would send the money to outside groups that supposedly “advocate” for or “serve” the allegedly malaffected “community.” And, no surprise, those outside groups just happened to be decidedly liberal “advocacy” groups of the barely disguised political-activist variety.
One recipient was the National Urban League — a venerable institution, but clearly on the Left. Another was the openly ethnicist Council of La Raza (now known as UnidosUS), which pushes for open borders and other “progressive” policies. Another was New Jersey Citizen Action, one of the many similarly named state groups with roots in the uber-leftist Students for a Democratic Society.
Congressional investigators unearthed emails showing representatives of some leftist groups begging Justice Department officials to undertake such suits in order to create a funding stream for them, and others indicate Obama political appointees in the department were working to ensure that no conservative groups would benefit, even if those groups likewise “advocated” for the supposedly distressed communities.
We would oppose these settlement slush funds regardless of the political affiliation of the recipients. It would be just as wrong for the Justice Department to start slush funds for conservative groups, such as National Right to Life or Judicial Watch, as it is for the former La Raza to benefit. (Imagine the liberal caterwauling if Trump officials, instead of working to end the practice, secured settlement payments for the National Rifle Association!)
The problems with these settlement slush funds are multiple. First, entities not in any way party to a lawsuit or directly related to it should not garner its proceeds. (Analogy: If John sues Mary and wins, the money shouldn’t go to John’s psychologist or his fitness trainer.) Second, to the extent that the settlement funds are meant as fines for offenses against the government or the law (without a directly cognizable victim), the money belongs first to the taxpayers — in other words, to the general treasury and not to some outside group. Third, if those funds are to be redisbursed elsewhere, the disbursement decision should come only from Congress through lawful appropriations, not at the discretion of some bureaucrat acting without expressly delegated authority from Congress.
This last point is one of the most basic and explicit precepts of the Constitution: Only Congress, elected by the people, has the power of the purse.
Moreover: “To allow unelected federal bureaucrats to funnel money to organizations that they picked undermines the integrity of the judicial process,” Tuberville said, quite rightly, to the Washington Examiner.
The abuse is even worse because of the lack of accountability for these slush funds. Using a very cautious estimate of the money set aside under Obama for outside groups, investigators found $668 million at play — but, get this, they were “able to determine the destination of $9.5 million of the funds; [just] 1.4% of the total.”
This isn’t slipshod accounting; this is a corrupt state of secrecy.
For all of these reasons, and for the good of both parties, Congress ought to pass Tuberville’s new bill — even over a Biden veto. Eventually, the courts probably would rule the practice unconstitutional, once presented with a plaintiff with proper legal standing — but Congress should not wait for courts to safeguard Congress’s own power and the fiscal rights of taxpayers.