Report May Mean More ACORN Controversy
The Association of Community Organizations for Reform Now, otherwise known as ACORN, has gotten a lot of bad press recently over accusations that it is involved in voter registration fraud.
While ACORN says that the accusations against it are exaggerated and politically motivated, an internal report may lead to new concerns. A lawyer for ACORN has compiled a report that raises questions about whether the complex network of relationships among the group's 174 affiliates may have led to violations of federal laws.
Presidential candidate Senator Barack Obama represented the group in a lawsuit in 1995. According to the New York Times, during the 2008 presidential race, Republicans have attempted to make an issue out of this professional relationship. The Obama campaign has denied any involvement in ACORN's voter registration drives.
The report in the spotlight now was written by Elizabeth Kingsley, a Washington lawyer, and is dated June 18, 2008. In the report, Kingsley outlines her concerns, which include ACORN's potentially improper use of charitable donations for political purposes, money transfers among the group's affiliates, and potential conflicts created by employees working for multiple ACORN affiliates.
The report also contradicts the official statement ACORN released in July regarding the embezzlement of nearly $1 million by Wade Rathke. Rathke is the brother of ACORN's founder.
The embezzlement reportedly occurred in 2000, but was not disclosed until the summer of 2008. Regarding the theft, Kingsley wrote that a full analysis of potential liability would require the assistance of an experienced white-collar criminal lawyer.
Bertha Lewis, ACORN's top executive, says that everything in Kingsley's report is being taken very seriously and the group has been working for the past three months to address the concerns raised by Kingsley.
Kingsley agreed that the concerns are being addressed and said that the national board has now adopted several good-governance policies, including appointing its first ever audit committee.
The timing of the disclosure of the report could not be much worse for ACORN. In addition to the allegations regarding voter registration fraud, ACORN is also facing demands from the IRS and various state tax authorities for payment of back taxes. This presents an enormous hurdle for ACORN to overcome, as foundations that have previously backed the group are now withholding support.
There is speculation that the report could ignite the controversy over ACORN's voter registration efforts. These efforts are largely underwritten by Project Vote, an affiliated charity. Project Vote employs ACORN to do voter registration work on its behalf. Through this partnership, the groups say that they have registered 1.3 million new voters in 2008.
ACORN is a nonprofit membership corporation formed under Louisiana law, is subject to federal taxation and has no restrictions on partisan political activity. However, Project Vote is a federally tax-exempt charity and as such is subject to prohibitions on partisan political activity.
If there were no agreement or relationship between ACORN and Project Vote, there would be no controversy. But the fact remains that Project Vote and ACORN have a written agreement that specifies that all work is nonpartisan, as all Project Vote work must be party-neutral.
Kingsley found that the nature of the relationship between ACORN and Project Vote made it impossible to document that the money paid by Project Vote had been used in a strictly nonpartisan manner. Prior to the public embezzlement scandal, Project Vote's board was comprised entirely of ACORN members and staff members.
The report raised questions about the lack of documentation to prove that no charitable funding was used for partisan political activities and about which organization was making all of the strategic decisions. Kingsley found that the same individuals who were deciding which regions to focus on for increased voter registrations for ACORN were also making the decisions for Project Vote.
As a result of these crossed lines, ACORN may not be able to prove that the federally tax-exempt funding provided by Project Vote has been used strictly in non-partisan efforts.
