Congressmen Charge Black Farmer Settlement Rife With Fraud

National Legal and Policy Center more than once has called it a shakedown. Now three members of Congress are suggesting as much. Yesterday Reps. Steve King, R-Iowa, Michele Bachmann, R-Minn., and Bob Goodlatte, R-Va., held a press conference to call for a Justice Department probe of an out-of-court class-action settlement against the U.S. Department of Agriculture initiated by black farmers during the late Nineties. The suit, known as Pigford v. Vilsack, or simply “Pigford II,” alleges the USDA starting in the early Eighties had discriminated on the basis of race in administering various grant and loan programs. Yet the details of the case strongly suggest that the evidence of willful discrimination was at best was fragmentary and often fraudulent.

It’s a familiar story: official capitulation to accusations of racial discrimination, minus any systematic evidence. This past February, lawyers for the Agriculture Department and thousands of black farmers reached a $1.25 billion follow-up class-action agreement presumably resolving residual claims of discrimination by persons filing after the original deadline roughly a decade ago. Congress already had authorized $100 million for this purpose in May 2008. And this is on top of the more than $1 billion already distributed to claimants in the original suit. The problem is that many of the people claiming their reward produced no evidence of discrimination. A brief review is in order.

Back in the mid Nineties, top officials of the Clinton administration, including then-Agriculture Secretary Dan Glickman, were determined to root out racial discrimination from all government programs. Secretary Glickman commissioned an Atlanta-based consulting firm, D.J. Miller & Associates, to conduct a study on the treatment of minority and women farmers under USDA programs. The report concluded that blacks in particular were getting less than their fair share of payments and loans. Yet at the same time the researchers admitted that they could not determine the reasons for the disparities between black and white farmers due to “gross deficiencies” in data collection and analysis. It was clear the study was driven by politics.

Secretary Dan Glickman, however, was convinced that the evidence was unimpeachable. Fearful of a small but aggressive group of black farmers demonstrating in front of the White House, Glickman put together an in-house civil rights task force whose eventual report recommended more than 90 steps to combat bias. That was all it took to bring plaintiffs and their legal eagles out of the woodwork. In 1997, a black farmer from North Carolina, Timothy Pigford, along with 400 co-plaintiffs, filed suit in U.S. District Court for the District of Columbia alleging USDA discrimination during 1983-97. Rather than refute the charges, the department agreed to a mediated settlement. Lawyers for the plaintiffs, without any evidence, raised the total of aggrieved parties to 2,000 and demanded blanket (rather than case-by-case) mediation. The big payoff came on April 14, 1999. U.S. District Judge Paul Friedman approved a consent decree for a revised settlement, which declared each farmer to be eligible for a lump sum award of $50,000 plus relief from outstanding loans and tax liability, as compensation for acts of discrimination occurring during 1981-96.

Consider that the original complaint cited no specific instances of discrimination other than a reckless and guilt-ridden statement by Glickman that discrimination was rampant in his department. An internal review of nearly 1,000 backlogged discrimination complaints, in fact, had found that in only five cases – less than 1 percent – was there evidence of even potential discrimination, a fact the department conveniently suppressed. Moreover, a claimant didn’t have to prove ownership of, or even employment at, a farm. Any claim of being turned down for a USDA loan or payment, whether or not substantiated, could qualify as having “attempted to farm.” Claims were easy to make, too, because the USDA kept unsuccessful loan applications on file for only three years. A review of the case by an Oregon contractor, Poorman-Douglas, revealed that some plaintiffs had tried to certify young children as eligible for reparations. Husband-wife couples applied separately in hopes of receiving double compensation for the same act. And, mysteriously, a number of deceased persons claimed their reward, represented by surviving family members and relatives. As for Timothy Pigford, the lead plaintiff, he earlier had filed suit against the USDA, only to have the action dismissed “with prejudice” – that is, he was prohibited from filing a subsequent suit making the same charges.

Over $1 billion thus far has been distributed under Pigford. Yet many in Congress want to increase that total by another $1.25 billion to cover tens of thousands of late filers supposedly unaware of the opportunity to file the first time around. The case has all the appearance of a scam. Yet the Department of Agriculture and the Department of Justice, each fearful of being tarred as “racist,” have refused to drop the case, especially as a pressure group calling itself the National Black Farmers Association has been conducting a continuous campaign. Current Agriculture Secretary Tom Vilsack, though nominally the current defendant, is determined to persuade Congress to authorize $1.15 billion, on top of the $100 million already approved, to make whole the February 2010 settlement. “I’m going to focus all my time and resources on making that happen,” Vilsack told reporters at the time. Attorney General Eric Holder likewise has stated: The plaintiffs can move forward and have their claims heard – with the federal government standing not as an adversary, but as a partner.” And President Obama lauded the agreement as “bringing these long-ignored claims of African-American farmers to a rightful conclusion.”

Three prominent Republican members of Congress, at least, have a real problem with this sort of “partnership.” Reps. King, Bachmann and Goodlatte, possibly relying on published NLPC stories (one only can hope), smell a shakedown. And while they aren’t overtly denouncing the Pigford II settlement, they are saying that the information on the case is insufficient to justify loosening public purse strings. At yesterday’s press conference, the trio called upon Attorney General Holder to conduct a complete investigation and appealed to the Senate to refrain from approving additional funding until the results of the probe are made available. Congressman King, a member of both the House Agriculture and Judiciary Committees, also announced that he had written Agriculture Secretary Vilsack to request a meeting next week to discuss allegations of major fraud in the disbursement of funds under the original Pigford suit. King stated:

There is a growing firestorm over the allegations of massive fraud in the Pigford settlements. According to sworn testimony by John Boyd, President of the National Black Farmers Association, there are 18,000 black farmers. They could not all have been victims of discrimination. To date, there have been over 94,000 claims made. These numbers speak to massive fraud, meaning that American taxpayers are on the hook for what Pigford judge Paul Friedman called ‘forty acres and a mule.’

It is common practice for Secretaries of Agriculture to sit down with members of the Agriculture Committee. It is uncommon for the topic of conversation to be as urgent and expensive as Pigford, with a price tag of $2.3 billion. Secretary Vilsack has an obligation to the American taxpayers to cooperate with an investigation of Pigford fraud.

The Senate may be poised to pass the Obama administration’s request for additional Pigford funding. Pigford payouts must be stopped until Congress and the USDA can conduct a thorough investigation.

It’s a reasonable appeal. Hopefully, the Obama administration can put aside any misgivings it might have that Rep. King’s concerns are rooted in “racism.” The issue is public accountability. Congress should not be spending billions of taxpayer dollars based on highly questionable and likely bogus claims, regardless of the race of the complainants. The Pigford case provides an example of what happens when plaintiffs and their litigators see government as a lottery rather than as a repository of the public trust – and when executive branch officials are too timid to admit as much.


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