Holder Cut Left-Wing Groups In On $17 Bil BofA Deal

A question raised was by what authority does Holder have in distributing this money as he has. The short answer is that supposedly these are some of the people affected by so-called bad bank practices. The longer answer is this represents only a few of those so-called hurt by the banks so how does Holder get away with redistributing the wealth to the list in this story and not others, especially when these groups represent a very political connection with this administration?

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Investor’s Business Daily

Attorney General Eric Holder, center, joined by Associate Attorney General Tony West, right, U.S. Attorney for the District of New Jersey Paul...Attorney General Eric Holder, center, joined by Associate Attorney General Tony West, right, U.S. Attorney for the District of New Jersey Paul.

Extortion: Radical Democrat activist groups stand to collect millions from Attorney General Eric Holder’s record $17 billion deal to settle alleged mortgage abuse charges against Bank of America.

Buried in the fine print of the deal, which includes $7 billion in soft-dollar consumer relief, are a raft of political payoffs to Obama constituency groups. In effect, the government has ordered the nation’s largest bank to create a massive slush fund for Democrat special interests.

Besides requiring billions in debt forgiveness payments to delinquent borrowers in Cleveland, Atlanta, Philadelphia, Oakland, Detroit, Chicago and other Democrat strongholds — and up to $500 million to cover personal taxes owed on those checks — the deal requires BofA to make billions in new loans, while also building affordable low-income rental housing in those areas.

If there are leftover funds in four years, the settlement stipulates the money will go to Interest on Lawyers’ Trust Account (IOLTA), which provides legal aid for the poor and supports left-wing causes, and NeighborWorks of America, which provides affordable housing and funds a national network of left-wing community organizers operating in the mold of Acorn.

In fact, in 2008 and 2009, NeighborWorks awarded a whopping $25 million to Acorn Housing.

In 2011 alone, NeighborWorks shelled out $35 million in “affordable housing grants” to 115 such groups, according to its website. Recipients included the radical Affordable Housing Alliance, which pressures banks to make high-risk loans in low-income neighborhoods and which happens to be the former employer of HUD’s chief “fair housing” enforcer.

BofA gets extra credit if it makes at least $100 million in direct donations to IOLTA and housing activist groups approved by HUD.

According to the list provided by Justice, those groups include come of the most radical bank shakedown organizations in the country, including:

• La Raza, which pressures banks to expand their credit box to qualify more low-income Latino immigrants for home loans;

• National Community Reinvestment Coalition, Washington’s most aggressive lobbyist for the disastrous Community Reinvestment Act;

• Neighborhood Assistance Corporation of America, whose director calls himself a “bank terrorist;”

• Operation Hope, a South Central Los Angeles group that’s pressuring banks to make “dignity mortgages” for deadbeats.

Worse, one group eligible for BofA slush funds is a spin-off of Acorn Housing’s branch in New York.

It’s now rebranded as Mutual Housing Association of New York, or MHANY. HUD lists MHANY’s contact as Ismene Speliotis, who previously served as New York director of Acorn Housing.

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From Judicial Watch. . .

The Department of Justice (DOJ) keeps giving radical leftist groups that support President Obama huge amounts of cash collected from big banks to settle discrimination and mortgage abuse lawsuits filed by the government.

Judicial Watch first reported the scheme two years ago when Countrywide Financial Corporation doled out $335 million to settle its discrimination lawsuit with the feds. The money was supposed to be distributed to more than 200,000 minority victims who supposedly were charged higher interest rates and fees than white borrowers based on their race not their credit. Instead, a chunk of the money went to Democrat-tied groups not connected to the lawsuit, including the scandal-plagued Association of Community Organizations for Reform Now (ACORN) and the open-borders National Council of La Raza (NCLR).

Now many of the same groups will get more money from a record $16.65 billion settlement with Bank of America. It’s a “historic resolution,” according to Attorney General Eric Holder, and the money will help make amends to borrowers and communities that were negatively affected by the bank’s conduct. Besides settling civil penalties at the state and federal level, the billions will bring relief to struggling homeowners and communities by, among other things, offering new loans and providing financing for affordable rental housing. Delinquent borrowers in Democrat strongholds like Chicago, Oakland and Detroit will also benefit from debt forgiveness.

Leftover funds will go to politically-connected community groups—like the NCLR, Operation Hope and National Community Reinvestment Coalition—that intimidate banks into qualifying more minorities for home loans, even if they really can’t afford it. This part of the deal is conveniently buried in the 37-page DOJ agreement, but a publication dedicated to covering business, finance and economics draws attention to it in a scathing editorial that refers to the arrangement as extortion.

“In effect, the government has ordered the nation’s largest bank to create a massive slush fund for Democrat special interests,” states the editorial which reveals that radical Democrat activist groups stand to collect millions from Holder’s record deal with Bank of America. “The recession has dried up funding for such groups. But Holder’s massive bank shakedown could rebuild their war chests in a hurry.” The piece also points out that Holder has brokered other similar deals that will provide more back-door funding for the Democrat groups. They include a $13 billion agreement with JPMorgan Chase and a $7 billion deal with Citibank.

Judicial Watch has investigated these controversial arrangements of funneling big portions of cash settlements from civil rights lawsuits to organizations not officially connected to the cases. In fact, back in 2010 JW sued the DOJ to obtain information about the outrageous policy. In response to our lawsuit the DOJ was forced to acknowledge that it has no official guidelines regarding “qualified organizations” that get leftover settlement funds and that it doesn’t monitor how the money is used.