Reps. Bachmann, King allege fraud in black farmers settlement

House Republicans on Wednesday charged that a multibillion-dollar settlement with black farmers supported by the Obama administration was rife with fraud.

At a press conference in the Capitol Visitor Center, Reps. Michele Bachmann (R-Minn.), Bob Goodlatte (R-Va.) and Steve King (R-Iowa) alleged that a $1.25 billion Agriculture Department (USDA) settlement to resolve discrimination claims included individuals who were never farmers. 

Bachmann said the discrimination claim process was subject to “massive and widespread fraud and abuse.” King also said he believes the Obama administration has ignored the fraud allegations surrounding the settlement.

“I think they have turned a blind eye to the fraud and corruption here,” King said. 

The GOP lawmakers called on Attorney General Eric Holder to start an investigation into the settlement’s claimants to ensure that they are genuine. In addition, they asked congressional leaders not to sign off on new appropriations for the settlement.

Agriculture Secretary Tom Vilsack “should put the brakes on this. He should not be asking the Congress to sweep money into this,” Goodlatte said. 

The lawmakers shared a list with reporters of three unnamed “whistleblowers” — one black farmer and two USDA employees — who would be willing to testify before a congressional hearing regarding the settlement process. They said their testimony would detail allegations of fraud and corruption in the settlement. 

At the press conference, Bachmann read from a letter from Ed Schafer, the last Agriculture secretary of the George W. Bush administration.

“I urge that our government step back and institute a procedure to properly investigate each claim to see if it is appropriate or not. The allegations of fraud and abuse must be addressed if we are going to assure our citizens that their government is pursuing equal justice for all,” Schafer said in the letter. 

King said he would push for a congressional investigation into the settlement if the House flips to Republican control after the midterm elections. 

A USDA official said the department has looked into allegations of fraud regarding the settlement. They were forwarded to the department's inspector general, who in turn referred them to the FBI. The FBI then indicted a total of 3 individuals among 20,000 claimants for the settlement, the official said.

Congress has to appropriate the funds to pay the settlement claims. The House passed a measure to do so this past summer, but it has hit gridlock in the Senate.

Senate Majority Leader Harry Reid (D-Nev.) has tried several times to secure a vote on the settlement funds — the last time being before the August recess — only to be blocked by Republicans who cited concerns over adding to the national deficit, as well as procedural complaints. 

At issue is a longstanding lawsuit, known as Pigford I, brought by black farmers against USDA. The class-action suit said USDA discriminated against black farmers by not providing them with loans and grants that were given to white applicants.

USDA settled that case in 1999. The department reached a new settlement in 2010, known as Pigford II, to resolve claims by late filers to the original settlement.

John Boyd Jr., president of the National Black Farmers Association, has been driving his tractor to the Capitol this month to protest the delay in the settlement. He has called on the Senate to approve the funds.

“A lot of the things they are raising just don’t stand up,” Boyd said about the GOP lawmakers’ charges. “I don’t think Mr. King and the crew have their facts straight here.”

In calling for the probe, the GOP lawmakers said there were 94,000 claims filed under the settlement even though Census data shows there are only 33,000 black farmers in the United States.

Boyd said that was a misunderstanding of the settlement. The agreement is set up to resolve discrimination claims of those who farmed as well as those who attempted to farm between 1981 and 1997. 

“The census has nothing to do with that,” Boyd said. 

In addition, he said Pigford II is a “not a blanket settlement” and every claim has to go through a court-appointed arbitrator to determine if it is valid. 

The black farmers’ advocate noted that the settlement has support from GOP lawmakers such as Sen. Chuck Grassley (Iowa). Boyd also cited legislation introduced on the issue by former Sen. George Allen (R-Va.) and former Rep. Steve Chabot (R-Ohio). 

Vilsack on Wednesday urged Congress to pass the settlement funding before adjourning, saying the black farmers “should not need to wait a day longer” to be compensated.

“Black farmers throughout the country unfortunately faced discrimination in past decades when trying to obtain services from USDA. This discrimination is well-documented, the courts have affirmed this discrimination and Congress has twice acknowledged the need to settle with those who have suffered from this discrimination,” Vilsack said in a statement.

“While members of Congress have noted the bipartisan support for this legislation, it is time for Congress to turn their support into action and fund the settlement agreement once and for all,” Vilsack said.

President Obama has also called on Congress to take action on the funding request, and USDA has been working to have the money appropriated. 

“It is a fair settlement. It is a just settlement. We think it’s important for Congress to fund that settlement. We’re going to continue to make it a priority,” Obama said on Sept. 10.

This article was updated at 4:51 p.m., 6:02 p.m. and 6:57 p.m.