Louisiana ACORN Embezzlement Investigation Continues

According to a review of documents provided to the Louisiana Attorney General's office based on an internal review, $5 million was embezzled by ACORN employees in the New Orleans office, and not $1 million. Where did the money go, and more importantly, who took it?

The new amount was reported in a subpoena released Monday from an investigation by Attorney General Buddy Caldwell. It is unclear if the money was taken from state, federal or private funds, according to the subpoena.

ACORN Chief Executive Officer Bertha Lewis said the new embezzlement allegation is "completely false." She said she would comment further after she and ACORN attorneys have a chance to review the subpoena.

Caldwell issued subpoenas in August seeking documents related to ACORN International then-President Wade Rathke and his brother, Dale Rathke, who kept the group's books. Those subpoenas targeted possible violations of state employee tax law, obstruction of justice and violations of the Employee Retirement Security Act.

The attorney general made inquiries in June into alleged embezzlement within ACORN that happened 10 years ago. The group last year dealt with an internal dispute and a lawsuit involving accusations that Dale Rathke made nearly $1 million in improper credit card charges in 1999 and 2000. Rathke's brother and a donor repaid the money.

Bertha Lewis of course is going to claim that the charges are false (and that's even without seeing the charges or other information relating to the case), but she also claimed that the O'Keefe and Giles videos were isolated cases, right before 5 videos showing substantially similar illicit responses made by ACORN employees at offices all across the country.

Curiously, this New York Times article notes that Lewis admits that Dale Rathke did embezzle some unidentified sum of money from ACORN coffers, but disagrees that the amount of money involved was $5 million. That amount apparently comes from two members of the Board of Directors of the national ACORN group that were voted out of office.

The subpoena, part of an investigation into accusations of state tax violations and obstruction of justice at Acorn, said the internal review was raised in a board meeting in October 2008 that was attended by Bertha Lewis, the chief executive.

“Current high-ranking members of Acorn have publicly acknowledged that the embezzlement did in fact occur, but the exact amount of the embezzlement was unknown,” the subpoena said. “It is still unclear if some of the monies embezzled are from state, federal or private funds.”

In a phone interview, Ms. Lewis acknowledged that the internal review found that Dale Rathke, brother of Wade Rathke, the founder of Acorn, had embezzled money from Acorn and affiliated charitable organizations in 1999 and 2000. But she said that the review had found that the amount embezzled was a little less than $1 million, a figure that has already been publicly disclosed and acknowledged.

She said the $5 million figure came from two former directors who had since been voted off the board.

So, based on the aforementioned information, it appears that the AP wire report left out critical information that identifies that Lewis admits that embezzlement did occur, and that Lewis was merely questioning the $5 million sum, which is a figure that links back to two former board members.