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Report Fraud, Waste and Abuse
January 19, 2012
  • Housing
2012-KC-1001
2012-kc-1001.pdf

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General
audited John Calvin Manor of Lee’s Summit, MO, in response to a request from HUD’s Office of Multifamily Housing in Kansas City, KS. Our audit objective was to determine whether the property violated its regulatory and loan agreement with HUD.

The property violated its regulatory and loan agreements with HUD by improperly spending restricted funds, defaulting on its mortgage payment, and failing to submit financial statements to HUD. In addition, it inappropriately made salary payments to its board president.

We recommend that HUD should develop a plan with the property to reestablish and fully fund its reserve for replacement account, debt reserve account, and tenant security deposit account and become current on its mortgage obligation. We also recommend that HUD work with the property to seek reimbursement from the former board president for the ineligible compensation he received and take appropriate administrative actions against the former board president up to and including debarment.