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Report Fraud, Waste and Abuse

The Offices of Audit and Evaluation supervise and conduct independent and objective audits, evaluations, and other reviews of U.S. Department of Housing and Urban Development (HUD) programs and activities to ensure they operate economically, efficiently, and effectively. This page contains links to our audit and evaluation reports and memoranda.

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    HUD’s Office of Multifamily Housing Programs Did Not Always Follow Mitigation Requirements for Its FHA-Insured Multifamily Projects
    The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General, audited HUD’s Office of Multifamily Housing Programs upon receiving a hotline complaint.  The hotline complaint contained allegations that (1) HUD routinely fails to perform Endangered Species Act analysis or consultations; (2) there are many projects that have deficiencies in noise analysis and environmental assessment site factors; (3) the…
    October 02, 2020
    Report
    #2021-KC-0001
    The Management Agent for Lake View Towers Apartments, Chicago, IL, Did Not Always Comply With HUD’s Section 8 HAP Program Requirements
    We audited the Lake View Towers Apartments’ Section 8 housing assistance payments program based on our analysis of risk factors related to multifamily projects in Region 5’s jurisdiction and the activities included in our fiscal year 2019 annual audit plan.  Our audit objective was to determine whether the management agent administered the project’s program in accordance with the owner’s contract with the U.S. Department of…
    September 03, 2019
    Report
    #2019-CH-1003
    MB Financial Bank, Rosemont, IL, Did Not Always Follow HUD’s Underwriting Requirements but Generally Complied With Quality Control Requirements
    We audited MB Financial Bank, a Federal Housing Administration (FHA)-approved direct endorsement lender, as part of our efforts to protect the integrity of the U.S. Department of Housing and Urban Development’s (HUD) single-family housing mortgage insurance programs.  We selected MB Financial for review based on an analysis of underwriting and default data maintained by HUD.  Our objective was to determine whether MB…
    September 20, 2017
    Report
    #2017-NY-1011
    The Cooperative and Management Agent Lacked Adequate Controls Over the Operation of Lakeview East Cooperative, Chicago, IL
    We audited the U.S. Department of Housing and Urban Development’s (HUD) resident home-ownership program grant for Lakeview East Cooperative (project) based on the results of a risk assessment of multifamily housing programs in Region 5’s jurisdiction (States of Illinois, Indiana, Michigan, Minnesota, Ohio, and Wisconsin).  The audit was part of the activities in our fiscal year 2017 audit plan.  Our objective was to…
    September 05, 2017
    Report
    #2017-CH-1006
    Stone Terrace Apartments, Chicago, IL, Did Not Always Comply With HUD’s Requirements Regarding the Administration of Its Section 8 Housing Assistance Payments Program
    We audited the Stone Terrace Apartments’ Section 8 housing assistance payments program based on a citizen’s complaint alleging mismanagement of its housing assistance payments contract.  The audit was part of the activities in our fiscal year 2017 annual audit plan.  Our audit objective was to determine whether the management agent administered the project’s program in accordance with the owner’s contract with the U.S.…
    August 25, 2017
    Report
    #2017-CH-1005
    Alpine First Preston Joint Venture II, LLC, Alpine, UT, Did Not Always Comply With Its Contract With HUD and Its Own Requirements for the Marketing and Sale of HUD-Owned Properties in the State of IL
    We audited Alpine First Preston Joint Venture II, LLC, a contracted asset manager in HUD’s real estate-owned Management and Marketing III program, as part of the activities included in our 2017 annual audit plan and because it was the sole contractor to market and sell U.S. Department of Housing and Urban Development (HUD) owned properties located in Illinois. Our audit objective was to determine whether Alpine complied with its…
    August 11, 2017
    Report
    #2017-CH-1004
    Judgment Imposed on the Former President and Founder of MDR Mortgage Corporation Regarding Allegations of Failing To Comply With HUD’s Federal Housing Administration Requirements
    The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General (OIG), in coordination with the U.S. Department of Justice’s Civil Division and the U.S. Attorney’s Office for the Northern District of Illinois’ Eastern Division, conducted a joint review of the former president and founder of MDR Mortgage Corporation. MDR Mortgage provided annual verifications to HUD in 2006, 2007, and 2008, certifying that none…
    March 31, 2017
    Memorandum
    #2017-CH-1801
    The Condominium Association and Management Agent Lacked Adequate Controls Over the Operation of West Park Place Condominium, Chicago, IL
    We audited the U.S. Department of Housing and Urban Development’s (HUD) resident home-ownership program grant for West Park Place Condominium (project) based on the results of a risk assessment of multifamily housing programs in Region 5’s jurisdiction (States of Illinois, Indiana, Michigan, Minnesota, Ohio, and Wisconsin) and the activities in our fiscal year 2016 annual audit plan.  Our objective was to determine whether the…
    September 30, 2016
    Report
    #2016-CH-1009
    Mortgage Services III, LLC, Bloomington, IL, Generally Complied With HUD’s Underwriting and Quality Control Requirements
    We audited Mortgage Services III, LLC, a Federal Housing Administration (FHA)-approved direct endorsement lender, as part of the activities in our fiscal year 2016 annual audit plan.  We selected Mortgage Services for review based on an analysis of data in the U.S. Department of Housing and Urban Development’s (HUD) Single Family Data Warehouse system  for single-family lenders with home offices in Region 5’s jurisdiction.…
    September 30, 2016
    Report
    #2016-CH-1011
    The Cooperative and Management Agent Lacked Adequate Controls Over the Operation of Carmen-Marine Apartments, Chicago, IL
    We audited the U.S. Department of Housing and Urban Development’s (HUD) Resident Homeownership Program grant for Carmen-Marine Apartments (project).  The audit was part of the activities in our fiscal year 2015 annual audit plan.  We selected the project based on a request from HUD’s Chicago Multifamily Housing Hub.  Our objective was to determine whether the Carmen-Marine Cooperative and management agent operated the…
    September 30, 2015
    Report
    #2015-CH-1010