More than $37 million in monthly housing subsidies for needy people ended up in the wrong hands last year because the Department of Housing and Urban Development doesn't know how to verify who's eligible for its program.

The housing subsidies are intended for low-income people who meet the "community service and self-sufficiency requirement" or CSSR. To qualify, you must be between 18 and 62 and log a minimum of eight hours of community service or job training each month. The whole idea is to help prop up people who are trying to get back into the job market or reward those who are helping their communities.

But a recent audit of the program quickly reveals that that's not exactly how the program is panning out.

HUD's Inspector General found that tenants in living in at least 106,000 of the 550,000 subsidized houses didn't meet the service or job training requirements needed to qualify for the program...