We audited the U.S. Department of Housing and Urban Development’s (HUD) oversight of Federal Housing Administration (FHA) refunds based on a hotline complaint alleging that HUD was trying to make it difficult for claimants to obtain refunds or discourage them from pursuing the refunds, which are due to eligible homeowners from the unearned portion of the upfront mortgage insurance premium paid.  Our audit found the allegations from the hotline complaint submitted to the HUD Office of Inspector General had some merit.  Also, HUD did not have adequate controls in place to ensure that refunds were appropriately tracked, monitored, and issued.  Specifically, HUD (1) did not ensure that the homeowner information for at least 23,579 loans with unpaid refunds totaling approximately $15.8 million was included in its public listing of unpaid refunds, (2) did not adequately track the status of refunds, (3) lacked policies and procedures for various stages of the refund process, (4) did not fully implement procedures it developed requiring additional documents from homeowners, and (5) did not follow the requirements of the Paperwork Reduction Act.  This condition occurred because HUD did not emphasize reviewing or monitoring the refund process to identify weaknesses and focused primarily on sending refund applications and issuing refunds to homeowners who returned the applications.  As a result, HUD could not ensure that it implemented a consistent refund process, and homeowners and third-party tracers were not able to search for all refunds HUD owed, which may have reduced the chance for homeowners for at least 23,579 loans to obtain approximately $15.8 million in refunds.  We recommended that the Deputy Assistant Secretary for Finance and Budget (1) develop and implement written policies and procedures and controls for the refund process to address the deficiencies identified, (2) develop, and implement policies and procedures for locating homeowners, a standard timeframe for mailing refund applications, and verifying the termination date, (3) research, develop, and implement policies and procedures to reduce the number of refunds that have remained unclaimed for an extended period, (4) develop and implement controls for the designation of legal representation for applicants, (5) ensure that the requirements that were developed for additional documents for identification are fully implemented, and (6) obtain approval under the Paperwork Reduction Act for the insert document mailed with the refund application and the Tracer Found Case form.