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HUD suspends Virgin Islands housing authority funding over fraud concerns
HUD said the authority has spent less than one-third of nearly $1.9 billion in Community Development Block Grant-Disaster Recovery aid nearly nine years after receiving it.
HousingWire reports that the U.S. Department of Housing and Urban Development suspended federal funding to the Virgin Islands Housing Finance Authority, citing findings from an investigation into how nearly $1.9 billion in disaster recovery funds were handled.
HUD said it found weak fraud controls, false certifications, improper payments, and limited project completion tied to Community Development Block Grant-Disaster Recovery programs, and it ordered the authority to stop receiving additional funding while investigations continue.
In a July 20 notice, HUD Deputy Secretary Andrew Hughes said the department is taking immediate action pending review by the HUD Office of Inspector General, which is examining potential offenses by the authority and its officers and employees.
HUD Secretary Scott Turner said the suspension follows allegations of financial mismanagement and that less than one-third of the funds have been spent nearly a decade after Hurricanes Irma and Maria struck in 2017, leaving residents without the housing and electrical power that were promised; the letter also references the conviction and prison sentence of former COO Darin Richardson.