Attorneys General Shady Business
Racket at Attorneys General Group Will Ring Familiar to Appraisers
The nation’s licensed real property appraisers will recognize a scheme run by a nonprofit known as the National Association of Attorneys General. It will remind the former of the abuses visited on them by a tiny, free-spending 501(c)(3) publisher and its captured federal minder.
The National Association of Attorneys General describes itself as a nonpartisan national forum for America’s state and territory attorneys general and their staff members. The group has close ties with trial lawyers, who bring tort cases on behalf of the states’ top law enforcement officers and then quietly funnel some of the settlement proceeds into a kitty. As they say in certain corners of the garbage hauling and waste management field, “All we want is a small taste.” The kitty then becomes a fund that underwrites more lawsuits and pays for a whole bunch of earthly delights for the AGs, their families and assorted cronies.
The shady activities at the attorneys general group – exposed by recent political infighting – will ring familiar to the nation’s beleaguered appraisers.
Appraisers have long been forced to pay into a dishonestly labeled “National Registry Fee,” which has been used as a slush fund to underwrite mischief and waste – everything from all-expense paid promotional junkets for state workers, global travel for the higher-ups at the nonprofit publisher, money for lawyers and for the creation of self-serving studies via cutouts such as a Kentucky-based nonprofit run by a man whose LinkedIn page shows he resides in the United Kingdom. Exceeding its statutory authority, the tiny federal agency, known by the tortuous name the Appraisal Subcommittee of the Federal Financial Institutions Examination Council, operates outside the annual congressional appropriations process. The lack of scrutiny and accountability has been a recipe for waste and abuse.
But back to the arrangement that supports the attorneys general. Earlier in the year, the AGs in Missouri, Montana, and Texas announced their withdrawal from the organization. Good for them. During an election year, no one wants to be slimed, and this group appears to have a rather wide goo-expulsion radius. Critics fault the group for pocketing a disproportionate share of multi-state lawsuit settlements – money that should go to the states and their citizens who have been hurt.
A quote by an anonymous state official in Helena likened the National Association of Attorneys General to a Las Vegas casino, where “the house always takes a pretty substantial cut… to the point you’d almost think that they’re a state.”
At the center of the rot is Iowa Attorney General Tom Miller. He appears to run the private group as a side hustle. A public-interest advocacy group known as the Alliance for Consumers Action Fund recently launched an ad campaign in the Hawkeye State targeting him for these activities. It’s unfortunate it requires an election year to shed light on something like this.
The consumer-advocacy group is focusing on the more than $250 million the National Association of Attorneys General has siphoned from state consumer protection settlements and how, on Miller’s watch, this money hasn’t been sent to the victims of consumer fraud but has instead been stashed in foreign investments and used for things like overseas trips for the AGs and their families.
The nation’s long-suffering real property appraisers will recognize the overseas travel. The so-called National Registry Fee they are compelled to pay at license renewal time has indirectly funded foreign junkets taken by the chief executive of the nonprofit publisher, a man named David Bunton, and a group of favored trustees on the latter’s executive compensation committee. These world citizens jet-set to places like Paris, Rome, Rio, London and Singapore. The nonprofit’s annual reports, many of which it has since purged from its web site, also chronicle past involvement with foreign governments, including those of Ukraine, Russia, China and Thailand. The full extent of its foreign dealings is still an open question.
Appraisers, who are licensed at the state level, are not permitted to opt out of the National Registry Fee when they renew their state licenses. The funding mechanism has always been highly dubious. It is more so after a recent court decision declaring a similar funding source received by the Consumer Financial Protection Bureau as unconstitutional.
But back to the AGs. Kentucky Attorney General Daniel Cameron sounded the alarm in a five-page letter in May to Chris Toth, who was then the group’s executive director. His letter was joined by attorneys general from Alaska, Florida, Louisiana, Oklahoma, South Carolina, Utah and Virginia.
Wrote Montana’s Attorney General Austin Knudsen: “Montanans rightly expect their elected officials to be good stewards of taxpayer dollars and [provide] transparency [for] funds that are supposed to be managed in our best interests.”
The election-year outrage has a manufactured feel about it.
At the moment, the National Association of Attorneys General holds a reported $280 million in assets. Critics worry this pot, and future settlement proceeds, will be funneled into politically motivated litigation and other creative mischief – not to mention garden variety self-dealing and waste.
Recently, a CBS affiliate in Colorado aired undercover video from a lavish event in Hawaii in which members of another dubious AG organization known as the Attorney General Alliance, chaired by Colorado Attorney General Phil Weiser, were treated to all-expense-paid stays at the Grand Wailea Resort in Maui where rooms start at $1,000 a night. The travel was paid for by corporations many of the attorneys general were suing at the time.
Critics are quietly optimistic that the nation’s attorneys general can be shamed into curtailing these corrupt practices. The nation’s licensed appraisers are less upbeat that the racket imposed on them will ever be reformed or its perpetrators held accountable.
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