Posts Tagged ‘ACORN Obama’

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Obama, ACORN, and the Financial Crisis

October 8, 2008

OneNewsNow

by Marcia Segelstein

How did we get into this financial mess in the first place? Well, to a large degree, it’s because lenders gave mortgages to borrowers who were unqualified, who shouldn’t have been given loans in the first place. Why did they do that?

Here’s the start of an article in the ‘Chicago Sun-Times’ from April 1995: “You’ve got only a couple thousand bucks in the bank. Your job pays you dog-food wages. Your credit history has been bent, stapled, and mutilated. You declared bankruptcy in 1989. Don’t despire: You can still buy a house.” That article then suggested that people wanting to buy homes who fit this profile go see a group called ACORN.

Obama at the time had his hands on the purse strings of two organizations. He was a director of the Woods Fund, and he was Chairman of the Board of the Chicago Annenberg Challenge (CAC). He gave money from both organizations to ACORN, and also provided training for ACORN workers.

According to Stanley Kurtz of National Review Online, “ACORN succeeded in drawing Fannie Mae and Freddie Mac into the very policies that led to the current disaster.” ACORN put pressure on banks by threatening them with accusations of racism if they didn’t give loans to minorities, even if they were completely unqualified.

Starting in 1987, ACORN began pressuring Fannie Mae and Freddie Mac to lower their standards for assuming mortage debt. And eventually they succeeded. By 1995, then President Clinton touted the fact that home-ownership in America was at an all-time high. According to Kurtz, ACORN representatives were guests of honor at this ceremony. (Note to McCain campaign: can you dig up that footage??)

But as Kurtz goes on: “At both the local and national levels, then, ACORN served as the critical catalyst, levering pressure created by the Community Reinvestment Act and pull with Democratic politicians to force Fannie Mae and Freddie Mac into a pattern of high-risk loans. Up to now, conventional wisdom on the financial meltdown has relegated ACORN and the CRA to bit parts…In fact, however, ACORN is at the base of the whole mess…And Barack Obama cut his teeth as an organizer and politician backing up ACORN’s economic madness every step of the way.”

The McCain campaign needs to go after Obama’s support of ACORN and its direct role in the current financial meltdown.

They could start by reading the entire Kurtz NRO piece here. Then maybe they should put Sarah Palin on the case.

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ACORN Corruption – Lawsuit Filed by Board Over Embezzlement

October 2, 2008

In August, two members of an ACORN interim management committee — Washington, D.C., board member Marcel Reid and Minnesota board member Karen Inman — filed suit in New Orleans seeking access to financial records and to remove Rathke from all ACORN-affiliated groups. They said a June 20 board resolution directed Rathke to step aside from any activities having to do with ACORN.

Rathke’s wife said his new employer, ACORN International, is a separate group with separate offices.

Here is what happenned:

The imbroglio dates to 1999 and 2000, when the nonprofit was calling for local increases in the minimum wage and trying to unionize hospitality workers in New Orleans. Dale Rathke, the founder’s brother, was serving as comptroller through a related organization called Citizens Consulting Inc., and Lewis said he abused his authority by using the group’s credit cards to buy things that were unrelated to its work.

A co-worker alerted Wade Rathke, who consulted with a few of ACORN’s national leaders. When the group’s longtime accountants at the New Orleans firm Duplantier, Hrapmann Hogan & Maher conducted an audit and found that $948,507 had been stolen, the Rathke family set up a formal repayment schedule. Dale Rathke was removed as comptroller at CCI, but he stayed on as a consultant at ACORN.

Lewis said the 51-member board did not know about the apparent theft until an ACORN financial supporter heard about it this spring and raised questions about whether its contributions had been misappropriated.

National board members were furious at the disclosure, and they have asked for a full airing of how the money was stolen and why it was kept secret from group for so long.

Dale Rathke resigned in early June. Wade Rathke also resigned from his position as chief organizer but remains with an affiliated group, New Orleans-based ACORN International, which does human rights work overseas.

The Rathke family repaid about $214,000 starting in 2001 through a loan taken out by CCI, and a California donor, Drummond Pike, recently stepped in and repaid the remaining debt.

Corruption All Over The Place
Wade Rathke told board members in June that he did not try to cover up his brother’s misdeeds. He asserted that he and other managers thought the repayment plan represented the best course of action because it would keep the incident out of the press, where it could provide fodder for political opponents at a time when ACORN had much work to accomplish, according to minutes of the meeting, which were available at Orleans Parish Civil District Court.

Rathke’s wife, Beth Butler, executive director of ACORN New Orleans, disputed the account of some board members that the family kept the embezzlement hush-hush. She said ACORN’s national executive committee and regional leaders knew what was going on, and its national executives took steps make sure CCI modernized its accounting controls.

– AP