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Document

We received a referral from the Quality Assurance Division of the U.S. Department of Housing and Urban Development’s (HUD) Philadelphia Homeownership Center concerning a borrower who allegedly made false statements to obtain Federal Housing Administration (FHA) mortgage insurance.  The borrower provided false and conflicting employment and income information, which was used in originating and obtaining an FHA loan.  Further, the borrower certified that he intended to reside in the property but failed to do so.  We referred the violations to HUD’s Office of Program Enforcement for action under the Program Fraud Civil Remedies Act.

On December 4, 2009, the borrower obtained an FHA loan to purchase a property in Baltimore, MD.  The borrower falsely certified his employment and income information when he signed the uniform residential loan application.  The borrower also falsely represented on the loan application that he intended to occupy the property as his personal residence.  The property was vacant and was being offered for rent in May 2010, 6 months after the settlement date.  The borrower’s actions violated FHA requirements.  On November 17, 2016, HUD’s Office of Program Enforcement filed a complaint against the borrower under the Program Fraud Civil Remedies Act.  After negotiations with HUD, the borrower agreed to pay $10,000 to settle the matter.  The agreement did not constitute an admission of liability or fault by any party.  The borrower made an initial payment of $2,000 on April 11, 2017, and agreed to a repayment plan for the remaining $8,000.

Recommendations

Key Details
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  Open
  Closed
Funds Put to Better Use
Funds Put to Better Use

Recommendations that funds be put to better use estimate funds that could be used more efficiently. For example, recommendations that funds be put to better use could result in reductions in spending, deobligation of funds, or avoidance of unnecessary spending.

Questioned Costs
Questioned Costs

Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.

Sensitive
Sensitive

Sensitive information refers to information that could have a damaging import if released to the public and, therefore, must be restricted from public disclosure.

Priority
Priority

We believe these open recommendations, if implemented, will have the greatest impact on helping HUD achieve its mission to create strong, sustainable, inclusive communities and quality affordable homes for all.

General Counsel

  •   2017-PH-1802-001-A
    $10,000.00

    Acknowledge that the attached settlement agreement for $10,000 represents an amount due HUD.