We audited the City of Atlanta, GA, and its subrecipient, the Fulton County-City of Atlanta Land Bank Authority.  We began our review of the City’s administration of its Neighborhood Stabilization Programs 1 (NSP1) and 3 (NSP3) grants because it aligns with our goal in the U.S. Department of Housing and Urban Development (HUD), Office of Inspector General’s annual audit plan to improve HUD’s execution of and accountability for grant funds...

We audited the Housing Authority of DeKalb County’s Rental Assistance Demonstration (RAD) conversion and Public Housing Capital Fund program.  We selected the Authority for review in accordance with our annual audit plan.  Our audit objective was to determine whether the Authority properly administered its RAD conversion and obligated and authorized capital funds in accordance with the U.S. Department of Housing and Urban Development’...

The U.S. Department of Housing and Urban Development’s (HUD) Office of Inspector General (OIG) assisted the U.S. Attorney’s Office of the Northern District of Alabama in the civil investigation of Guardian Pest Services, Inc., doing business as Knox Pest Control and J.J.S.K. Solutions, Inc.  Knox Pest Control has its principal place of business in Columbus, GA.  A HUD home is a one-to-four unit residential property acquired by HUD as...

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General (OIG), referred alleged violations to HUD’s Office of Program Enforcement for action under the Program Fraud Civil Remedies Act based on two audits of DHI Mortgage Company Ltd.  (DHIM) that found it did not follow HUD requirements when it underwrote Federal Housing Administration (FHA)-insured loans with prohibited restrictive addenda to the purchase...

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General audited Solace LLC’s Section 8 housing assistance payments program because of the results of our previous audit of another multifamily property.  The person responsible for housing assistance program issues at the other property was also Solace’s manager.  Our objectives were to determine whether Solace correctly computed tenant annual income,...

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General audited Reflection5 LLC’s Section 8 housing assistance payments program because of the results of a previous audit of another multifamily property.  The person responsible for housing assistance program issues at the other property was also involved with the housing assistance program at Reflection5.  Our objectives were to determine whether...

We audited the Georgia Housing and Finance Authority’s implementation of the Federal Housing Administration’s Home Affordable Modification Program (FHA-HAMP).  We selected the Authority because (1) our data analysis showed that the Authority had the highest ratio of FHA-HAMP actions to delinquent loans within the jurisdiction of our regional office, (2) the U.S. Department of Housing and Urban Development (HUD) office located in Atlanta,...

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General audited the Sunset Manor Apartments to evaluate the allegations in a complaint and determine whether the project’s owner made unauthorized distributions and repayment of advances, maintained complete, accurate, and current books and records for the project, and participated in improper procurement practices.         ...

We audited Coconut Grove Apartments due to concerns expressed by the U.S. Department of Housing and Urban Development’s (HUD) Office of Multifamily Housing Programs regarding the management of the project.  The main concern was that the owner may have diverted project funds for nonproject expenses.  Our audit objective was to determine whether Coconut Grove’s owner operated its Sections 223(f) and 241(a)-insured multifamily rental...

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General (OIG) assisted in an investigation into alleged violations of Federal Housing Administration (FHA) regulations by Taylor, Bean & Whitaker Mortgage Corporation and Home America Mortgage, Inc.  The investigation included a qui tam action filed under the False Claims Act in the U.S. District Court for the Northern District of Georgia.  The False...

We audited St. Francis Hospital, Inc. because the U.S. Department of Housing and Urban Development (HUD), Office of Hospital Facilities, requested immediate assistance from HUD’s Office of Inspector General (OIG) to review suspected violations of the hospital’s regulatory agreement and rider (including covenants).  Our objective was to determine whether the hospital complied with the executed regulatory agreement and HUD requirements for...

We audited NOVA Financial & Investment Corporation based on a referral from the U.S. Department of Housing and Urban Development’s (HUD) Quality Assurance Division detailing a separate lender that originated Federal Housing Administration (FHA)-insured loans that contained ineligible downpayment assistance gifts.  The HUD Office of Inspector General’s (OIG) analysis identified NOVA as a lender with the highest origination volume in the...

We audited the Housing Authority of the City of Comer’s financial and procurement operations.  We selected the Authority based on concerns from the U.S. Department of Housing and Urban Development’s (HUD) Georgia State Office of Public Housing regarding significant deficiencies identified during its August 2013 management review.  HUD’s Office of Public Housing identified findings regarding the misuse of funds, a lack of governance...

HUD OIG conducted a civil investigation of an alleged loan origination fraud scheme involving a cash-out refinance loan that was insured by the Federal Housing Administration (FHA).  FHA provides mortgage insurance on loans made by FHA-approved lenders to creditworthy borrowers.  Borrowers must occupy the properties as their primary residence for at least 1 year.  Borrowers certify to their intent to occupy the property when...

We reviewed Southwest Stage Funding, LLC, dba Cascade Financial Services, in Gilbert, AZ.  We selected Southwest Stage because it originated 1,841 loans totaling more than $244 million during calendar years 2012 and 2013.  Further, it had received more loan endorsements on manufactured housing loans than any other lender in Texas since January 1, 2009.  Our objective was to determine whether the lender complied with U.S....

We audited the White Mountain Apache Housing Authority’s Indian Housing Block Grant (IHBG).  We conducted the audit primarily due to concerns raised by HUD’s Southwest Office of Native American Programs regarding the Authority’s financial management practices.  The objective of the audit was to determine whether the Authority used its IHBG funds in accordance with HUD requirements. The Authority failed to use its IHBG funds in...

We audited The Lending Company, Inc., based on a hotline complaint, previous U.S. Department of Housing and Urban Development (HUD) reviews, and our goal to improve the integrity of the Federal Housing Administration (FHA) single-family insurance programs.  Our objectives were to determine whether The Lending Company complied with HUD requirements when it used gift programs, originated and underwrote FHA loans, and implemented its quality...

We audited the State of Iowa’s monitoring of the City of Cedar Rapids’ voluntary property acquisition program.   We selected the State for review based on a prior audit of the City’s voluntary property acquisition program.  During fiscal years 2009 through 2012, the State awarded the City more than $166 million in disaster funding.  Our audit objective was to determine whether the State monitored the City’s voluntary...

The U.S. Department of Housing and Urban Development (HUD) – Office of Inspector General audited the Idaho Housing and Finance Association’s HOME Investment Partnerships Program because it received approximately $6 million in HOME grants from the U.S. Department of Housing and Urban Development (HUD) in each of fiscal years 2008 through 2010. The objective of our review was to determine whether Idaho Housing complied with HOME match fund and...

The U.S. Department of Housing and Urban Development, Office of Inspector General audited Allen Mortgage, Limited Liability Company, a Federal Housing Administration (FHA) nonsupervised lender. We selected Allen Mortgage for audit based on its high default and claim rate for the FHA-insured loans sponsored in Region 5. Our objectives were to determine whether (1) Allen Mortgage complied with HUD’s regulations, procedures, and instructions in...