Pursue administrative actions, as appropriate, against the responsible parties for the improper certification included in form HUD-50059 and the Section 8 project-based voucher housing assistance payments contract.

Acknowledge that the attached settlement agreement of $325,000 represents an amount due HUD from Pacific Horizon.

Acknowledge that the attached settlement agreement for $15,000 represents an amount due HUD from the two loan officers.

Acknowledge that $3,375,163 in the attached settlement agreement represents an amount due HUD, less DOJ’s civil debt collection fees

Acknowledge that the $6,749,673 in the attached indemnification agreement represents an amount due HUD.

Acknowledge that $32,500,000 in the attached settlement agreement represents an amount due HUD, less DOJ’s civil debt collection fees.

Acknowledge that $7.23 million of the $14.5 million in the attached settlement agreement represents an amount due HUD, less DOJ’s civil debt collection fees.

The OIG has determined that the contents of this recommendation would not be appropriate for public disclosure and has therefore limited its distribution to selected officials.

The OIG has determined that the contents of this recommendation would not be appropriate for public disclosure and has therefore limited its distribution to selected officials.

Acknowledge that $6,076,741 of the $13,200,000 in the attached settlement agreement represents an amount due HUD, less DOJ’s civil debt collection fees.

Develop and implement a procedure to ensure that all differences identified during financial statement and note validations are corrected before certification.

Develop and implement a process that ensures the routine collection of information needed to accurately complete the narratives required according to GAAP and OMB Circular A-136.

Develop and implement a procedure to ensure that HUD’s quarterly consolidated financial statements accurately reflect HUD’s current contingent liabilities resulting from pending or threatened litigation or unasserted claims.

Restate the following in HUD’s fiscal year 2017 consolidated financial statements: (1) Note 3, Fund Balance with Treasury, so that it is comparable to HUD’s new status of fund balance with Treasury presentation, (2) the statement of net cost by reducing the administrative costs for non-FHA programs by $174 million, and (3) the balance sheet to correct the $136.7 million misstatements in the Commitments and Contingencies and Other Liabilities line items. If a partial restatement or no restatements are made, OCFO should provide justifications and support for the decisions.

In consultation with the Office of Housing FHA Comptroller, develop and establish internal controls to ensure periodic communications for assessing and agreeing to the cost allocation accounting policies and procedures.

Develop and implement a cost allocation methodology that includes all HUD programs and components, including Ginnie Mae, in the distribution of administrative costs.

In consultation with the Office of Chief Human Capital Officer (OCHCO), develop and establish an activity-based costing process to validate the accuracy of factors used to allocate personnel and other administrative costs to each program and ensure that the validation is performed annually.

In collaboration with the Office of the Chief Information Officer (OCIO), implement an improved cost allocation methodology for IT cost based on direct costs used by the programs.

Determine whether HUD’s FSSP, ARC, has resources available to enhance HUD’s cost allocation methodology to identify, trace, and allocate costs directly to program activities periodically and at yearend.

Develop and implement a procedure that (1) detects significant fluctuations or discrepancies in Ginnie Mae’s budgetary data, (2) investigates the fluctuation or discrepancy to determine whether an error has occurred, and (3) performs corrections as needed, in a timely manner.