U.S. flag

An official website of the United States government Here’s how you know

The .gov means it’s official.

Federal government websites often end in .gov or .mil. Before sharing sensitive information, make sure you're on a federal government site.

The site is secure.

The https:// ensures that you are connecting to the official website and that any information you provide is encrypted and transmitted securely.


We audited the Dolores Frances Affordable Housing project, based on a citizen complaint and a suggestion from the U.S. Department of Housing and Urban Development’s (HUD) Departmental Enforcement Center.  The complaint alleged nonpayment of HUD utility allowances and security deposits, mismanagement of the maintenance department, related parties hired in supervisory positions, and conflict-of-interest vendor contracts by the related party of Dolores Frances (Pico Union Housing Corporation).  Our audit objective was to determine whether Dolores Frances was administered in accordance with HUD rules and requirements. 

The allegations stated in the complaint were generally unsubstantiated and had no merit.  However, Dolores Frances was not administered in accordance with HUD requirements.  The project made ineligible payments of $531,186 for expenses that were not reasonable and necessary for the operation of the project.  In addition, Dolores Frances inappropriately secured more than $10.9 million in unsupported loans that encumbered the properties of the project without HUD approval.  These actions increased the project’s risk of mortgage default.

We recommend that the Acting Director of HUD’s Los Angeles Office of Multifamily Housing Programs require the owners of Dolores Frances to (1) stop disbursing project funds for ineligible social services fees and reimburse the project $300,000, (2) reimburse the project for $74,784 in consulting fees and $18,178 in fees charged by the management agent that were ineligible, (3) reimburse the project for $114,068 in ineligible legal fees, (4) provide documentation to support HUD approval for the loan between Dolores Frances and Pico Union for more than $6.3 million and how the funds were used or remove the loan and associated encumbrance from the project, (5) provide documentation to support that the loan between Dolores Frances and Alliant for more than $4.5 million was approved by HUD or remove loan and any associated encumbrance from the project, and (6) implement controls to ensure that management and ownership follow the project’s policies and procedures, the regulatory agreement, and HUD program requirements.  We also recommend that the Director of the Departmental Enforcement Center pursue civil and administrative remedies, as appropriate, against the owners of Dolores Frances.