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new detergent stinksFor those of you wondering what ACORN has been doing during the summer vacation, never fear, despite the groups supposed death, and new names and the criminal enterprise is alive, well and still ripping of the public. A new investigation U.S. Department of Housing and Urban Development (HUD) takes a look at  HUD’s Housing Counseling Program grant funds awarded to the ACORN Housing Corporation, Inc.

The HUD Inspector General, who conducted the study finds that ACORN misused the grant funds and recommend that they no longer receive funds from HUD.

“For continued approval as a HUD-approved housing counseling agency and for future awards consideration, AHC (now operating as AHCOA) must bring its operations into full compliance with applicable laws, regulators, and policies governing HUD’s Housing Counseling Program,” the OIG’s report recommends. “The inability to fully support salary expenses allocated to the HUD grant raises serious concerns about the integrity of those charges, particularly given the millions of Federal and non-Federal dollars made available to AHC in FY 2008 and 2009. Further, services procured from ACORN “associated” organizations failed to meet the required tests of ‘open and free competition’. We recommend that HUD’s Office of Single Family Housing, Program Support Division consider placing AHCOA in ‘inactive’ status while its initiatives corrective actions to address the exceptions and recommendations in this report.”

What did ACORN do that was so bad? You could start with lousy record keeping (whether on purpose or not) on top of that, they used other ACORN operations as a vendor with out competitive bidding and billing it all back to Uncle Sam.

HUD has awarded ACORN more than $19 million in housing counseling grants since 1995. Between 2008 and 2009 ACORN received almost 80% if the HUD grants ($2.544 million). Among the findings by the HUD Inspector General were:

  • ACORN may have concealed fraud by destroying or failing to produce records.
    • “A determination could not be made as to what activities the employees performed or which grant to charge for those activities. Consequently, HUD had no assurance that it did not bear more than its fair share of the costs incurred for salary expenses of AHC’s counselors.” (p.10).
    • Availability of records impeded [HUD’s] attempt to trace AHC’s summary schedules of counselors’ salary expenses to the housing counseling activities that occurred[.]” (p.11).
  • ACORN Housing received more than $27.269 million from other Federal and non-Federal sources, and did not differentiate which donors projects were being executed by which personnel at what time:
    • NeighborWorks, a congressionally chartered nonprofit, provided ACORN with $25,857,000 million. 
    • AHC’s caseload allocation methodology for salary expenses to the HUD housing counseling grants proved problematic in an environment of multiple funding sources and was unsupported.” (p. 11).
    • NeighborWorks grant funds were misappropriated as well. “The housing counseling service costs were either charged as salary expenses to the HUD housing counseling grants or as fees to the NeighborWorks’ NFMC [National Foreclosure Mitigation Counseling] grants. For counselors who provided services under both grants, reimbursement of their salary costs for HUD billing purposes was based on a percentage derived from the ration of HUD to NFMC cases as opposed to using the actual number of hours attributable to the HUD counseling grant.” (p. 11).
  • “Also, missing was documentation of the actual activities to support the percentages of allocations to the HUD grant.” There was “the risk of inequitable charges when counselors’ time was split between HUD, NFMC, and/or other funding sources.” (p. 11).
  • ACORN’s use of grants did not comply with Office of Management and Budget (OMB) Circular A-122. 
  • In a new twist to the “no show job”ACORN charged the government salary costs for employees after they were terminated (p.12). 
  • ACORN charged 2008 salary expenses to a 2009 grant in violation of Article III and Article IX of the HUD grant agreement (p.12-13).
  • ACORN violated 24 CFR Part 84 (federal procurement standards) when it obtained accounting and legal services, leased office space, and sought health care and retirement benefits from its affiliated nonprofits. In other words, ACORN housing gave business to other ACORN organizations.  These services were obtained by ACORN without ensuring open and free competition as required by law.
    • Because ACORN failed to comply with 24 CFR  84.43, which requires that “All procurement transactions shall be conducted in a manner to provide . . . open and free competition [without] conflicts of interest as well as noncompetitive practices”, ACORN’s self-dealing served to funnel taxpayer dollars to its affiliates (p.13).
  • Citizens Consulting, Inc., (CCI) an ACORN affiliate, provided AHC’s accounting and legal services and charged $345,174 to HUD. The technical term for that is having the wolf guard the hen house and making the hens pay.
    • CCI’s services were essentially a sole source arrangement that lacked an ‘arms length’ basis for demonstrating cost reasonableness.’” (p. 14).
  • AHC leased office space from ACORN-San Jose, ACORN-Sacramento, Elysian Fields Corporation, and New Mexico Organizing and Support Center – all ACORN affiliates – and “Branch office leasing costs were charged directly to the HUD housing counseling grants” (p. 14).
  • AHC obtained health care benefits for its employees from the Council Health Plan and the Community Health Insurance Plan (CHIP), both were identified as ACORN-owned in Elizabeth Kingsley’s June 18, 2008 report on ACORN mismanagement. “The costs of both plans were billed to the HUD counseling grants” (p. 15). 
  • ACORN’s retirement funds were managed by ACORN affiliate Council Benefit Association (CBA). Costs of $460,630 in 2008 and $384,693 in 2009 were billed to HUD (p. 15).

Because of ACORN’s lousy record keeping, it is impossible to track where all the money went.

“Further, cost or price analysis and documentation to support the basis and justification for the services was not readily available.” (p. 13).

According to  Congressman Darrell Issa (R-CA),ranking member of the House Oversight and Government Reform Committee issued a report back in April examining the 13 supposedly new organizations that came out of ACORN’s supposed demise and declared back then, reports of ACORN’s demise were greatly exaggerated.

 “Based on review of these corporate filings, Committee investigators have discovered that Affordable Housing Centers of America, Inc. maintains the same Tax Identification Number as ACORN Housing, Inc., its predecessor,” the Issa-released Report found. “This means that, for tax purposes, Affordable Housing Centers of American and ACORN Housing are the same. Additionally, Committee investigators found that several new ACORN affiliates maintain the same boards, staff and Employer Identification Numbers as former ACORN offices. This reflects the lack of true change or reform between these new organizations and their predecessors.”

Those “break off organizations” are just the same ole ACORN. They tried this elaborate ruse to shake off the “bad image” it earned through the embezzlement stories, the voter fraud and of course the amazing efforts of the Team of Hannah Giles/James O’Keefe (the undercover Hooker/Pimp team who exposed so much about ACORN’s real intentions). They probably even believed that it  take the some of the government pressure off (pressure only coming from the GOP), what they didn’t realize is the rancid smell of corruption will keep people on their heels.

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