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ACORN Can Receive Pending Federal Payments, Justice Department Says

Bertha Lewis

Bertha Lewis, CEO of ACORN, is seen. (AP)

The Obama administration legally can pay the embattled community organizing group ACORN for services performed under contracts approved before Congress banned the government from providing money to the group, the Justice Department has declared.

David Barron, the acting assistant attorney general for the Office of Legal Counsel, wrote in a memo last month that the ban "should not be read as directing or authorizing HUD to breach a pre-existing binding contractual obligation to make payments to ACORN or its affiliates, subsidiaries or allied organizations where doing so would give rise to contractual liability."

Click here to read the memorandum.

Republicans quickly blasted the ruling that was made public Friday.

"The bipartisan intent of Congress was clear -- no more federal dollars should flow to ACORN," said Rep. Darrell Issa, the top Republican on the House Committee on Oversight and Government Reform.

"It is telling that this administration continues to look for every excuse possible to circumvent the intent of Congress," the California Republican said in a written statement. "Taxpayers should not have to continue subsidizing a criminal enterprise that helped Barack Obama get elected president."

"The politicization of the Justice Department to pay back one of the president's political allies is shameful and amounts to nothing more than old-fashioned cronyism," he added.

The federal government has poured about $53 million into The Association of Community Organizations for Reform Now since 1994, mostly in grants from the Department of Housing and Urban Development for affordable housing services.

But the group has been brought to its knees in recent months following the release of undercover videos showing a couple posing as a pimp and prostitute receiving advice from ACORN employees on how to skirt tax laws and acquire illegal home loans to establish a brothel that could house underage girls who illegally crossed the border.

Footage showed staffers advising the "pimp" and "prostitute" on how to falsify tax forms and seek illegal benefits for 13 "very young" girls from El Salvador that the pair said they wanted to bring to the country to work as child prostitutes. The videos set off a firestorm in Congress.

ACORN pledged an internal inquiry and fired the staffers who were caught on tape, but it was only the latest of many legal troubles for the group.

Republicans led the charge to ban all federal funding to the group as the Obama administration quickly distanced itself from the group.

ACORN has fought back, filing a lawsuit against the government in an attempt to regain the millions of dollars in funding Congress voted to block after the undercover videos were released in September.

The suit charges Congress with violating the Constitution when it passed legislation in September that specifically targeted ACORN to lose federal housing, education and transportation funds.

ACORN claims it has been badly hurt by the congressional actions and has had to fire workers and close some of its 1,200 branches around the country.

Though it remains unclear precisely how much money the national organization was receiving from federal sources and aid programs, a lawyer pressing the suit said ACORN has already lost an amount "in the millions" since the freeze took effect.