Admin/civil actions 18
Chart 4.2: Percentage of OIG community planning and development
closed investigation cases during this reporting period
Region 1 - 4% Region 2 - 5% Region 3 - 1% Region 13 - 5% Region 4 - 5% Region 14 - 1% Region 5 - 4% Region 15 - 3% Region 6 - 0% Regions 7/8 - 4% Region 9 - 4% Region 10 - 2% Region 11 - 62%
Theft/Embezzlement
Linda Bevins, a former payroll supervisor at the Crotched Mountain Foundation (Crotched Mountain), an organization that receives HUD CDBG and Supportive Housing Program (SHP) funds, pled guilty in U.S. District Court, Concord, NH, to committing theft from a program receiving Federal funds. From June 2004 to August 2007, Bevins diverted and personally used about $1.6 million in Crotched Mountain funds without authorization. New Hampshire civil default judgments in the amount of $1.6 million were also individually awarded against Bevins and her daughter, Holly Sears.
Gordon Harlin, a former grant writer for Community of Family and Friends, a nonprofit organization that receives HUD SHP funds, pled guilty in U.S. District Court, Fort Worth, TX, to making false statements to a Federal agency and aiding and abetting. Harlin provided false documents that enabled Community of Family and Friends to fraudulently obtain more than $1.1 million in SHP funds..
Joseph Giacalone and Daniel Robin, doing business as OK Industries, an organization that receives HUD CDBG funds, each pled “nolo contendere” in Seventh Circuit Court, Flint, MI, to committing larceny by conversion greater than $20,000. Giacalone and Robin applied for and received about $870,000 in CDBG funds to relocate their manufacturing business to an economically deprived area and expand their operations, but Giacalone and Robin allegedly failed to comply with HUD stipulations and defaulted on their loan. HUD recovered the funds by offsetting future City of Flint CDBG funding.
Henry Humphrey and Kevin Harris, the chief executive officer and treasurer of Shiloh Baptist Church Community Renewal Center, an organization that receives HUD CPD and other funds, were each indicted in U.S. District Court, Louisville, KY, for allegedly committing a conspiracy, embezzlement, wire fraud, and aiding and abetting. From 1998 to 2005, Humphrey and Harris allegedly diverted about $500,000 in HUD funds to themselves.
Frank Rose, the director of the Linden Neighborhood Preservation program, an organization that receives HUD CDBG and HOME funds; Anthony Rose, the former director of the Linden Department of Transportation and Parks; and Walter Zawacki, a partner in Zawacki Construction, were collectively sentenced in U.S. District Court, Newark, NJ, to 60 months incarceration and 108 months probation and ordered to pay HUD $281,148 in restitution for their earlier guilty pleas to committing mail fraud or filing a false Federal income tax return. From January 1998 to October 2007, Frank Rose accepted bribes from Zawacki and others in exchange for more than $5 million in Linden Neighborhood Preservation construction contracts, and Anthony Rose awarded more than $1.3 million in construction and maintenance contracts to companies he owned.
Barbara Alvarado, a former bookkeeper for the Los Angeles House of Ruth (House of Ruth), a homeless and domestic violence shelter that receives HUD SHP funds, was sentenced in U.S. District Court, Los Angeles, CA, to 1 year incarceration, 1 year home detention, and 3 years probation and ordered to pay House of Ruth $138,370 in restitution for her earlier guilty plea to committing misapplication of property from an organization receiving Federal funds. Alvarado altered House of Ruth accounting records and victim funding requests and fraudulently obtained and personally used $238,000 in House of Ruth funds.
Jubilee Restoration, Inc. (Jubilee), a nonprofit organization that receives HUD SHP funds, was sentenced in U.S. District Court, Oakland, CA, to 5 years probation and ordered to pay HUD $177,381 in restitution for its earlier guilty plea to submitting fraudulent claims to HUD. From 2002 through 2004, Jubilee submitted $199,476 in fraudulent claims for fictitious or previously paid homeless youth counseling services.
Yvette Crayton, a grant-writing consultant for the Shiloh Community Renewal Center (Shiloh Community), an organization that receives HUD CPD funds, pled guilty in U.S. District Court, Louisville, KY, to making false statements and committing embezzlement and a conspiracy. From 2001 to 2005, Crayton and others diverted about $120,000 in Shiloh Community rehabilitation and construction funds earmarked for a senior living center.
Phyllis Rawley, the former executive director of the El Paso Empowerment Zone, a nonprofit organization that receives HUD Empowerment Zones and Rural Housing and Economic Development (Rural Housing) program funds, was indicted in U.S. District Court, El Paso, TX, for allegedly committing theft of HUD funds and wire fraud. From August 2004 to November 2006, Rawley allegedly embezzled $116,675 in Rural Housing funds when she received duplicate payments for the same expenses she charged to different grants.
Danny Davis, a former Community Planning and Homeowner Rehabilitation program administrator for Johnson City, a municipality that receives HUD CDBG funds, was indicted in Washington County District Court, Johnson City, TN, for allegedly committing theft, money laundering, forgery, and official misconduct. From March 2003 to June 2007, Davis allegedly created a shell company, awarded housing rehabilitation contracts to himself, and fraudulently obtained more than $60,000 in HUD funds.
Christine Baker, the former executive director of the South Elyria Neighborhood Development Corporation (South Elyria), an organization that receives HUD CDBG funds, was indicted in U.S. District Court, Cleveland, OH, for allegedly making false statements and committing embezzlement, theft of government funds, and credit card fraud. Baker allegedly embezzled $59,857 in South Elyria funds, failed to report her South Elyria and other income on U.S. Department of Agriculture (USDA) certifications, and obtained $44,271 in USDA benefits she was not entitled to receive.
Dawn Monteneri, a former bookkeeper for Support Ministries, Inc., an organization that receives HUD CDBG, Emergency Shelter Grant, and other funding, was indicted in Albany County Court, Albany, NY, for allegedly committing grand larceny and filing false business documents. Monteneri allegedly diverted and personally used $56,000 in Support Ministries’ funds.
William Redden, a former building and construction inspector for the City of Rochester, a municipality that receives HUD CDBG funds, pled guilty in U.S. District Court, Rochester, NY, to committing bribery. Between 2003 and 2008, Redden accepted between $8,000 and $10,000 from previously indicted Michael Cenzi and others in exchange for Rochester demolition contracts.
Anthony Saccomanno, the former director of the Cherry Hill Department of Code Enforcement and Inspections (Cherry Hill), an organization that receives HUD CDBG funds, and Russell McLauglin, Jr., the former president of Building Inspections Underwriters, Inc. (Building Inspections), each pled guilty in U.S. District Court, Newark, NJ, to committing mail fraud or giving and offering a bribe. In November 2007, Saccomanno caused a letter to be mailed when he accepted money from a Building Inspections representative, and McLauglin paid about $5,000 to Saccomanno in return for $240,000 in Cherry Hill contracts. HUD losses are not yet determined.
Other Fraud/Crimes
Neil Goldstein was indicted in New York Superior Court, Manhattan, NY, for allegedly falsifying business records; Riad Khalil was arrested after his indictment for allegedly falsifying business records and committing banking violations; and Charles Goldberg, the owner of multiple check cashing companies, pled guilty to falsifying business records. Goldstein and Khalil allegedly and Goldberg admittedly obtained and negotiated about $40 million in checks payable to the John Galt Corporation (John Galt), Regional Scaffolding & Hoisting (Regional Scaffolding), and other organizations to avoid filing New York currency transaction reports. The checks to John Galt, Regional Scaffolding, and other organizations were payments from the Lower Manhattan Development Corporation, an organization that received HUD CDBG Disaster Recovery Assistance funds for demolition of the Deutsche Bank building, a building damaged during the September 11, 2001, terrorist attacks
Janei Walker, a Buffalo Urban Renewal Agency (Urban Renewal) CDBG recipient, pled guilty in U.S. District Court, Buffalo, NY, to making false statements. Walker failed to report income or an accurate marital status on her lead abatement application and fraudulently obtained $16,960 in CDBG funds she was not entitled to receive.
Heather Little, a former employee of the Columbus House, a homeless shelter that receives HUD CDBG and Emergency Shelter Grant funds, was sentenced in U.S. District Court, Bridgeport, CT, to 6 months home confinement and 5 years probation for her earlier guilty plea to possession of stolen mail. Little and others stole, altered, and negotiated U.S. Treasury checks delivered to the Columbus House.