We audited Ofori & Associates, PC, regarding its U.S. Department of Housing and Urban Development (HUD) real estate-owned (REO) Management and Marketing (M&M) III program. This review was part of the Office of Inspector General’s efforts to improve the integrity of the single-family insurance program. Our audit objective was to determine whether Ofori complied with case processing requirements and timeframes to obtain the highest net return for HUD’s REO inventory and minimize holding time.
Ofori officials did not always comply with case processing requirements and timeframes for the disposition of REO properties assigned to them. Specifically, they did not always perform all case processing requirements or perform case processing requirements in a timely manner to minimize holding time and costs to HUD. They also did not adequately document information in case files and the P260 computer system. This condition occurred because Ofori officials did not always follow contract and marketing plan requirements; have adequate controls in place to ensure that case processing requirements were completed and documented; and adequately address procedures, processes, and timeframes they would follow. As a result, HUD did not have assurance that it always received the highest net return on its REO inventory and that holding time and costs were minimized.
We recommend that the Deputy Assistant Secretary for Single Family Housing require Ofori officials to establish sufficient internal controls to ensure that contract and marketing plan requirements are performed adequately and in a timely manner. We also recommend that the Deputy Assistant Secretary for Single Family Housing provide guidance to Ofori officials regarding adequately documenting P260 and the property case files, and ensure that it develops adequate controls to ensure that all required documentation is included in the property case files and uploaded to P260.