The New York Times reported on July 9, 2008, that Dale Rathke, the brother of ACORN's founder Wade Rathke, was found to have embezzled $948,607.50 from the group and affiliated charitable organizations back in 1999 and 2000.[79] ACORN executives decided to handle it as an internal matter, and did not inform most of the board members or law enforcement, and instead signed an enforceable restitution agreement with the Rathke family to repay the amount of the embezzlement. $210,000 has already been repaid, and a donor, Drummond Pike, has offered to pay the remaining debt.[80] The Times reported that, according to Wade Rathke, "the decision to keep the matter secret was not made to protect his brother but because word of the embezzlement would have put a 'weapon' into the hands of enemies of ACORN, a liberal group that is a frequent target of conservatives who object to ACORN's often strident advocacy on behalf of low- and moderate-income families and workers." A whistleblower revealed the embezzlement in 2008. On June 2, 2008, Dale Rathke was dismissed, and Wade stepped down as ACORN's chief organizer, but he remains chief organizer for Acorn International L.L.C.[79]
In September 2008, following revelations of Dale Rathke's embezzlement, two members of ACORN's national board of directors filed a lawsuit seeking to obtain financial documents and to force the organization to sever ties with Wade Rathke.[81] ACORN's executive committee voted unanimously to remove the two, "because their actionssuch as releasing a confidential legal memo to the presswere damaging the organization."[82]
In October 2009, Louisiana Attorney General Buddy Caldwell claimed in a subpoena that ACORN's board of directors found that a larger amount$5 millionhad been embezzled from the organization. Bertha Lewis, ACORN's CEO, said the allegation is false.[83] On November 6, following up on the subpoena, Caldwell served a search warrant at the ACORN headquarters in New Orleans.[84] Caldwell stated, "This is an investigation of everythingAcorn, the national organization, the local organization and all of its affiliated entities."[85]