We received a referral from the Quality Assurance Division of the U.S. Department of Housing and Urban Development’s (HUD) Philadelphia Homeownership Center concerning a borrower who allegedly made false statements to obtain Federal Housing Administration (FHA) mortgage insurance.  The borrower provided false and conflicting employment and income information, which was used in originating and obtaining an FHA loan.  Further, the…

We conducted an attestation review of the U.S. Department of Housing and Urban Development (HUD), Office of Special Needs Assistance Continuum of Care Program, regarding drug control accounting and associated management assertions for fiscal year 2016.  The objective of our attestation review was to evaluate HUD’s financial reporting and assertions for drug control funds to determine if its reporting was in compliance with regulations and…

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General audited HUD’s Office of Community Planning and Development’s (CPD) process for making changes to its programs, policies, and operations.  We initiated the audit because of concerns we had with HUD’s disaster recovery delivery sequence and duplication of benefits policies during a previous external audit (Audit Report 2016-DE-1003). Our objective was to…

The Office of Community Planning and Development (CPD) manages more than $14 billion in disaster recovery funding that Congress appropriated through the Disaster Relief Appropriations Act of 2013 (Public Law (PL) 113-2).  CPD distributed the funds to 34 grantees as Community Development Block Grant Disaster Recovery grants. PL 113-2 requires grantees to establish adequate procedures to detect fraud, waste, and abuse of disaster recovery…

Twenty-two Promise Zones were selected through three rounds of national competition. The U.S. Department of Housing and Urban Development (HUD), oversees 14 urban Promise Zones, and the U.S. Department of Agriculture (USDA) oversees 8 rural and tribal Promise Zones. The Office of Management and Budget (OMB) tasked HUD and USDA to lead the Promise Zone initiative and play essential roles in gathering information about progress in Promise Zones…

This report is for informational purposes only and does not represent an OIG perspective or position. The Robert T. Stafford Disaster Relief and Emergency Assistance Act was designed to bring an orderly and systematic means of Federal disaster assistance for State and local governments to carry out their responsibilities to aid citizens.  Although, State and local governments may carry out their responsibilities in an orderly and…

We audited the St. Tammany Parish grants department’s administration of its Community Development Block Grant (CDBG) disaster recovery program, as part of our annual audit plan to review the Disaster Relief Appropriations Act, 2013 funds.  Our objective was to determine whether the Parish administered its disaster recovery program in accordance with U.S. Department of Housing and Development (HUD) requirements and in line with its…

The Office of Community Planning and Development (CPD) manages $15.2 billion in disaster recovery funding appropriated by Congress in the Disaster Relief Appropriations Act of 2013 (Sandy Supplemental). CPD distributed the funds to 34 grantees as Community Development Block Grants-Disaster Recovery (CDBG-DR). CPD uses a risk analysis process to rank grantees that pose the greatest risk to the integrity of its programs. According to CPD, the…

We audited the U.S. Department of Housing and Urban Development’s (HUD) procurement of major service contracts by the Office of the Chief Procurement Officer (OCPO) as part of our fiscal year 2016 audit plan and due to a hotline complaint regarding a contract for scanning services.  Our audit objective was to determine whether HUD had adequate procedures in place to plan and monitor major service contracts to prevent waste and abuse. HUD’s…

The Digital Accountability and Transparency Act of 2014 (DATA Act) and implementation guidance provided in the Office of Management and Budget Memorandum M-15-12 mandates that Federal agencies must report their financial, budgetary and programmatic information to the USASpending.gov web site by the statutory May 2017 deadline. In our second of two Data Act Readiness Reviews, OIG reviewed the U.S. Department of Housing and Urban Development’s (…

In accordance with the Chief Financial Officers Act of 1990, as amended, we are required to annually audit the consolidated financial statements of the U.S. Department of Housing and Urban Development (HUD). HUD reissued its fiscal year 2016 and 2015 (Restated) consolidated financial statements due to pervasive material errors that were identified by us. Our objective was to express an opinion on the fairness of HUD’s consolidated…

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General (OIG), reviewed preforeclosure sales under the Federal Housing Administration (FHA) program in the St. Louis, MO, area.  We found that the purchaser of a property being sold in a preforeclosure sale entered into a consulting agreement with the realtor.  The agreement required that when the purchaser later sold the property, he would pay half of the…

We reviewed the general and application controls over the Federal Housing Administration’s (FHA) Single Family Premiums Collection Subsystem – Periodic (SFPCS-P) and Single Family Acquired Asset Management System (SAMS) as part of the internal control assessments required for the fiscal year 2016 financial statement audit under the Chief Financial Officer’s Act of 1990.  Our objective was to review the general and application controls over…

We audited the U.S. Department of Housing and Urban Development’s (HUD) computing environment as part of the internal control assessments required for the fiscal year 2016 financial statement audit under the Chief Financial Officer’s Act of 1990.  Our objective was to assess the effectiveness of the controls over the New Core Interface Solution (NCIS) and PRISM™ and the impact of the implementation of release 3 of phase 1 of the New Core…

We audited the U.S. Department of Housing and Urban Development’s (HUD) oversight of its Home Equity Conversion Mortgage (HECM) program and found that 33 borrowers had more than 1 loan under the program.  Having multiple loans violated program requirements because HUD requires borrowers to reside in the mortgaged residence as their principal residence and borrowers may not have more than one principal residence at a time.  We referred…

This report was reissued on February 24, 2017, to correct Appendix A. This reissued report now correctly shows the monetary benefit associated with each recommendation. This report supplements our independent auditor’s report on the results of our audit of HUD’s principal financial statements for the fiscal years ending September 30, 2016 and 2015 (Restated) related to HUD’s internal controls and compliance with applicable laws, regulations,…

The Federal Information Security Modernization Act of 2014 (FISMA) directs Inspectors General to conduct an annual evaluation of the agency information security program.  FISMA, Department of Homeland Security (DHS), Office of Management and Budget (OMB) and National Institute of Standards and Technology (NIST) establish information technology (IT) security guidance and standards for Federal agencies. We conducted this evaluation to assess…

We audited the State of New Jersey’s Community Development Block Grant Disaster Recovery-funded Superstorm Sandy Housing Incentive Program contract.  We conducted the audit because the contract involved a significant amount of funds ($67.7 million), was critical to the implementation of three of the State’s disaster programs, and was terminated less than 1 year into the 3-year contract term.  Our objective was to determine whether the…

We audited the State of Oklahoma because it received $93.7 million in Community Development Block Grant Disaster Recovery (CDBG-DR) allocations for presidentially declared disasters that occurred in 2011, 2012, and 2013.  The substantial amount of CDBG-DR funding required a review of the State’s program.  Our objective was to determine whether the State obligated and spent its grant in accordance with requirements.  The State…

We audited HUD’s compliance with the fiscal year 2015 travel and purchase card programs based on our required fiscal year 2014 risk assessment, which determined the U.S. Department of Housing and Urban Development’s (HUD) agencywide charge card program to be at medium risk for fraud. Offices of inspector general are required to (1) conduct periodic assessments of the agency charge card programs, (2) perform analyses or audits as necessary, and…