Bank of America is reviewing its grant program, while CitiGroup is waiting for results of official investigations in the scandal. JP Morgan Chase had previously ended its relationship with ACORN, the Association of Community Organizations for Reform Now. Banks and other financial institutions have given millions of dollars and other forms of support to ACORN for decades in response to boycott threats from the organization, as well as accusations of racism and other forms of discrimination in granting personal loans and mortgages.
The ACORN campaigns followed passage of the 1977 Community Reinvestment Act (CRA), which was designed to pressure financial institutions to loosen lending standards in order to increase home ownership among poor and minority communities. Legislation strengthening CRA during the Clinton administration greatly encouraged such ACORN activities.
Bank of America has given 28 grants totaling almost $3 million to ACORN Housing Corporation (AHC) since 2005, financial records show. A company spokesman said the activity exposed on videotape prompted the present review. “We do not condone the actions of ACORN Housing employees exposed in recently released videotapes,” Bank of America spokesman Richard Simon told The Examiner. “We have begun a review of ACORN Housing’s governance to ensure if these were individual incidents rather than a systemic breakdown before we make decisions on future actions.”
JP Morgan Chase contributed over $5 million in grants to the housing affiliate, over a five-year period. But this program is no longer active, Jennifer Zuccarelli, a spokeswoman said. “JP Morgan Chase provided a five-year community development grant to fund affordable housing and foreclosure prevention initiatives across the country,” Zuccarelli said. “The commitment ended a year ago in 2008 and no further grants will be considered.”
Undercover videos made by James O’Keefe and Hannah Giles posing as a pimp and prostitute, respectively, feature ACORN workers offering advice in Baltimore, Md. Brooklyn, N.Y. and San Bernardino, Calif. The ACORN staffers in Baltimore told O’Keefe and Giles how to falsify documents and obtain benefits for “very young girls” from El Salvador. ACORN is suing O’Keefe and Giles, as well as Andrew Breitbart, owner of the BigGovernment.com blog that published the videos, claiming the audio portion from Baltimore was obtained illegally under a Maryland law that bars tape recording individuals on the telephone without their consent.
Citigroup donated $5,000 to the Baltimore office in 2003. “We are deeply concerned about the recently released videos of frontline ACORN staff, and we look forward to the findings of the independent auditor and a timely conclusion to this matter,” said Citicorp's Andrea Hurst.
Dissident current and former officials of ACORN claim that donations made to AHC and other affiliates are often misappropriated. The organization’s finances are handled through the Citizens Consulting Inc. (CCI), according to the ACORN 8, a whistleblower group. “There’s no guarantee that any donations are going where they are supposed to be going,” said Ron Sykes, treasurer of the Washington D.C. ACORN and a member of the ACORN 8.
Bret Jacobson, president and founder of Maverick Strategies, said banks could risk legal action from unhappy shareholders if managers do not sever financial ties with ACORN. “It would be gross negligence for banks to continue paying public relations protection money to an organization that is so radioactive,” said Jacobson, whose firm specializes in political-public relations efforts. “ACORN has finally been exposed for its deep-seeded corruption and now bankers have to do a serious cost-benefit analysis of whether they want to be financially linked to a group willing to support child prostitution rings.”
Source: NetRight Nation
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