HUD Director Goes on $336,000 Shopping Spree with Low-Income Housing Funds
August 18, 2017
A high-ranking public housing official charged with providing government-subsidized homes to the poor stole hundreds of thousands of dollars from the agency and used it to buy furniture, alcohol, clothes, makeup and other personal items. The crooked public official scammed the government for years undetected which may seem unbelievable though not when it comes to the agency she worked for, a bastion of corruption known as Housing and Urban Development (HUD).
This is an agency that’s been embroiled in a multitude of serious scandals—under both Democrat and Republican administrations—over the years. One veteran employee at a state branch stealing a few hundred thousand bucks to go on a marathon shopping spree is no biggie. Problems go back to the Ronald Reagan administration, when an influence-peddling scandal led to the conviction of 16 people, including top aides to then HUD Secretary Samuel Pierce. Bill Clinton’s housing secretary, Henry Cisneros, pleaded guilty to lying to the FBI about payments to his former mistress. George W. Bush’s HUD secretary, Alphonso Jackson, was ousted after the feds launched an investigation into his plots to enrich himself and his friends by giving them lucrative government contracts. Barack Obama’s second HUD secretary, Julian Castro, misspent the agency’s federal funds as mayor of San Antonio.
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Audit Report Number: 2015-FO-0006 Date: July 7, 2015
HUD Did Not Evaluate and Report Potential Violations of Its Government Purchase Card Program
What We Audited and Why
We audited the U.S. Department of Housing and Urban Development’s (HUD) administration of its purchase card program in accordance with the Charge Card Abuse Prevention Act of 2012. Our 2013 risk assessment review identified HUD’s purchase card program at medium to high risk for fraud or misuse,1 and our review of HUD’s Semiannual Purchase Card Violation Report (audit memorandum number 2014-FO-0801) raised concerns regarding HUD’s internal controls over the purchases made within this program. The objective of the audit was to determine whether HUD evaluated and reported improper and potentially illegal uses of government purchase cards.
What We Found
Purchase card transactions were generally supported. However, HUD did not evaluate a potential violation to determine whether it constituted a significant weakness and could have provided better transparency by reporting the potential purchase card violation in its reports to the Office of Management and Budget. Specifically, HUD did not evaluate or report a violation in which an employee made fraudulent purchases totaling $11,938 from August through October 2013.
What We Recommend
We recommend that HUD revise existing procedures to include the evaluation of the impact of identified violations on HUD’s purchase card program controls and how violations will be reported.
Feds: St. Clair official spent funds meant to help poor on makeup, booze
By Tresa Baldas Aug. 8, 2017
Lorena Loren was supposed to help poor people obtain affordable housing.
Instead, prosecutors say, she was stealing from the poor to buy booze, makeup, clothes and homes for her relatives.
But after years of scheming, authorities say, the government caught on.
In a public corruption case that surfaced in federal court today, Loren, the former executive director of the St. Clair Housing Commission, was charged with embezzling more than $300,000 in low-income housing funds and spending the money on herself and family.