Emails obtained by the Washington Free Beacon appear to show clearer evidence the Obama-era Justice Department sought to exclude conservatives from the corporate payouts widely criticized as a “slush fund” for left-wing groups.
The Free Beacon reports that, in discussing the proceeds from a major 2013 settlement with Bank of America and Citigroup, Principal Deputy Associate Attorney General Elizabeth Taylor and Associate Attorney General Tony West exchanged a series of emails. Among other things, they emphasize the importance of “not allowing Citi to pick a statewide intermediary like the Pacific Legal Foundation” because that group “does conservative property-rights free legal services.”
Much of the DOJ settlement money from these suits went instead to avowedly left-wing groups like the National Urban League and National Council of La Raza, now known as UnidosUS. According to the Free Beacon, an activist from one of the groups due to receive Bank of America and Citigroup cash under the scheme wrote in an email, “I would be willing to build a statue [of West] and then we could bow down to this statue each day after we get out $200,000+[.]”
“Cy pres” payments – where mostly corporate defendants agree to pay into charities as part of their settlement with the government to avoid further prosecution – have been a regular feature of DOJ civil lawsuits since the 1970s, when the Community Reinvestment Act began the practice of requiring banks and financial institutions to fund “community organizations.” Under President Barack Obama’s attorney generals, however, the practice rapidly expanded, flush with cash from massive settlements from banks stemming from the 2008 financial crisis.
The practice began to attract negative attention towards the end of Obama’s term in office. In 2015, Kimberly Strassel called the program “a scheme to undermine Congress’s spending authority by independently transferring dollars to President Obama’s political allies” in her Wall Street Journal op-ed. Shortly thereafter, Republicans in Congress tried unsuccessfully to rein in the Department of Justice, before trying again this year.
Attorney General Jeff Sessions issued a memorandum to all sections of the DOJ in June categorically stopping the practice. As Breitbart News discovered, Sessions’ office then initiated a department-wide review of all cy pres settlements for the past decade that would not meet his newly specified standards.