House Passes Goodlatte Bill to Halt Settlement Slush Funds
Last evening, the House of Representatives passed Congressman Bob Goodlatte’s (R-Va.) Stop Settlement Slush Funds Act of 2017 (H.R. 732), a product of the House Judiciary Committee, by a vote of 238-183. This bill permanently bars federal agencies from requiring defendants to donate money to outside groups as part of settlement agreements, and requires that settlement money goes either directly to victims or to the Treasury.
Congressman Goodlatte, the sponsor of this legislation, issued the following statement:
“An investigation by the House Judiciary Committee last Congress revealed the Department of Justice’s abuse of power: using settlement agreements to direct money away from victims toward organizations of their choosing and away from those they disliked. DOJ’s actions contradict the spending power given explicitly to the Legislative Branch and undermine Congress’s most effective tool to hold the Executive Branch accountable. Regardless of which party is in the White House, subverting Congress to funnel money to outside organizations is unacceptable and unconstitutional.
“I applaud the passage of this bipartisan bill that bans settlement payments to non-victim third parties permanently for future administrations. There should be no excuse or justification for this banned behavior, and I urge my colleagues in the Senate to defend Congress’s constitutional interests and support H.R. 732.”
Background: A joint investigation by the House Judiciary Committee and Financial Services Committee revealed that DOJ used mandatory donations to direct nearly a billion dollars to activist groups during the last two years of the Obama Administration. Internal documents reveal that the third-party organizations were actively involved in lobbying DOJ to receive settlement money, and that DOJ went out of its way to exclude conservative groups.
The House Judiciary Committee held hearings in February 2015, May 2015, and April 2016 to question DOJ officials regarding their use of settlement agreements. The Committee also sent multiple oversight letters to DOJ requesting documents and requested that DOJ preserve all documents related to the agency’s settlement practices.
This bill is similar to the Stop Settlement Slush Funds Act of 2016 (H.R. 5063), which passed the House by a vote of 241-174.
In June, Attorney General Jeff Sessions announced that the Department of Justice would end the practice of settlement agreements to direct payments to non-victim third parties. H.R. 732 makes it permanent.