Justice Department Ends Government Bankrolling of Liberal Groups in Legal Settlements
AG Jeff Sessions announced Wednesday that the Justice Department is ending the practice of paying millions to third parties in legal settlements. |
The move by Sessions abolished a practice that has funneled likely millions of dollars in banking settlements to outside organizations in such “third-party” payments.
Left-wing groups, including La Raza and NeighborWorks America, benefited from the practice, The Daily Signal previously reported.
In a formal statement, Sessions said:
Effective immediately, [Justice] Department attorneys may not enter into any agreement on behalf of the United States in settlement of federal claims or charges, including agreements settling civil litigation, accepting plea agreements, or deferring or declining prosecution in a criminal manner, that directs or provides for a payment or loan to any non-governmental person or entity that is not a party to the dispute.
Attorney General Jeff Sessions Ends Third Party Settlement Practice https://t.co/rnCYAr31bH— Justice Department (@TheJusticeDept) June 7, 2017
After the 2008 financial crisis, the Obama administration alleged that banks were responsible for inflating the mortgage bubble.
The Justice Department and the banks settled with the settlements running into the millions of dollars, Paul J. Larkin Jr., a senior legal fellow at The Heritage Foundation, told The Daily Signal in an interview.
Sometimes the Justice Department would allow donations to third parties to be counted toward the settlement value.
The practice is unlawful, said Larkin, whose work on the issue was cited by Sessions in the attorney general’s decision.
“Some of the settlements allowed a settling party to treat $1 given to a favored organization as counting for $2 toward the settlement,” Larkin said.
He added:
“It’s about time that someone did something about this,” Allen said. “It is a practice that had been going on throughout the government for decades, and we need to crack down. This is a very important first step by the attorney general.”
Sen. Chuck Grassley, R-Iowa, chairman of the Judiciary Committee, praised Sessions’ move.
“Today’s decision by the attorney general to end the Justice Department’s use of settlement agreements to fund politically favored organizations is a win for the victims in such disputes and for checks and balances in government,” Grassley said. “Under the Constitution, Congress holds the purse strings.”
The decision by President Donald Trump’s attorney general to end third-party settlements also benefits taxpayers, Larkin said.
“Sessions’ decision is the right one because it ends an unlawful and unethical Justice Department practice,” he said. “The department’s third-party payment practice was tantamount to the theft of money that belonged to the public.”
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Rachel del Guidice (@LRacheldG)is a reporter for The Daily Signal. She is a graduate of Franciscan University of Steubenville, Forge Leadership Network, and The Heritage Foundation’s Young Leaders Program.
Tags: Justice Department, Jeff Sessions, Ends Government Bankrolling, Liberal Groups, Legal Settlements, Rachel del Guidice, The Daily Signal To share or post to your site, click on "Post Link". Please mention / link to the ARRA News Service and "Like" Facebook Page - Thanks!
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