We audited loans originated by Bankers Mortgage Group, Woodland Hills, CA, in response to a referral from the Office of Inspector General’s (OIG) Office of Investigation alleging that Bankers Mortgage Group originated loans with false documentation. Our objective was to determine whether the lender originated FHA-insured loans using sufficient, reliable, and valid documentation. Bankers Mortgage Group did not originate loans using sufficient…

We completed a review of the Oakland Housing Authority in response to a hotline complaint alleging that the Authority engaged in various questionable functions involving its inspection services. The objective of the review was to determine whether the complaint allegations against the Authority were valid. Most of the allegations against the Authority were generally not valid. However, we found indications that 13 of the 19 housing units…

We audited the Los Angeles Neighborhood Housing Services’ Neighborhood Stabilization Program 2 (NSP2). We performed the audit because American Recovery and Reinvestment Act of 2009 reviews are part of the Office of Inspector General’s (OIG) annual plan and Neighborhood Housing Services was awarded $60 million in Recovery Act NSP2 funds in a consortium agreement with 12 other organizations on February 11, 2010. Our audit objective was to…

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General (OIG), conducted a review to determine whether Indymac Bank followed Federal Housing Administration (FHA) policies and procedures when it originated FHA-insured loans. We identified a set of questionable loans originated by Indymac that had been generated by Beechwood Incorporated, a company that conducted various real estate services. Based on our review…

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General (OIG), conducted a review to determine whether Indymac Bank followed Federal Housing Administration (FHA) policies and procedures when it originated FHA-insured loans. We identified a set of questionable loans originated by Indymac that had been generated by Beechwood Incorporated, a company that conducted various real estate services. Based on our review…

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General (OIG), conducted a review to determine whether Indymac Bank followed Federal Housing Administration (FHA) policies and procedures when it originated FHA-insured loans. We identified a set of questionable loans originated by Indymac that had been generated by Beechwood Incorporated, a company that conducted various real estate services. Based on our review…

We reviewed the books and records of Amar Plaza (project), a U.S. Department of Housing Department (HUD)-insured (Section 236) multifamily cooperative housing project with project-based Section 8 assistance located in La Puente, CA. We initiated the review in response to a request from the Departmental Enforcement Center due to its concerns about Amar Plaza’s serious compliance issues, including but not limited to overdue 2009 and 2010…

We reviewed alleged violations of U.S. Department of Housing and Urban Development (HUD) Federal Housing Administration (FHA) loan origination requirements by the subject. We concluded that the subject placed fraudulent information and documents in mortgage loan applications for Government-insured home loans. The Department of Justice filed a complaint under the Financial Institutions Reform, Recovery, and Enforcement Act; and in March 2012…

We reviewed alleged violations of U.S. Department of Housing and Urban Development (HUD) Federal Housing Administration (FHA) loan origination requirements by the subject. We concluded that the subject created and altered documents used in mortgage loan applications for Government-insured home loans. The Department of Justice filed a complaint under the Financial Institutions Reform, Recovery, and Enforcement Act; and in December 2011 reached…

We reviewed alleged violations of U.S. Department of Housing and Urban Development (HUD) Federal Housing Administration (FHA) loan origination requirements by the subject. We concluded that the subject placed fraudulent information and documents in mortgage loan applications for Government-insured home loans. The Department of Justice filed a complaint under the Financial Institutions Reform, Recovery, and Enforcement Act; and in December 2011…

The City did not expend Brownfields and Section 108 funds awarded for the development of the project in accordance with HUD requirements. Specifically, the City used loan and grant funds for an ineligible project and expended grant funds after the grant deadline. As a result, it expended (1) $3.8 million in loan funds on an ineligible project, (2) $625,000 in grant funds on an ineligible project after the grant expenditure deadline, and (3) an…

We audited the City of Modesto’s Neighborhood Stabilization Program 2 (NSP2). We performed the review because it was part of the Office of Inspector General’s (OIG) audit plan to conduct audits of NSP2 under the American Reinvestment and Recovery Act of 2009. We selected the City because it received $25 million and HUD’s San Francisco Office of Community Planning and Development requested that OIG consider a review of the City. Program funds…

The U.S. Department of Housing and Urban Development, Office of Inspector General audited Countrywide Bank, FSB (Countrywide),* a Federal Housing Administration (FHA) supervised lender** approved to originate, underwrite, and submit mortgages for insurance under the U.S. Department of Housing and Urban Development’s (HUD) direct endorsement program. We selected Countrywide based on its average default-to-claim rate of 6.76 percent for the FHA-…

We conducted a review to determine whether IndyMac Bank followed Federal Housing Administration (FHA) policies and procedures when it originated FHA-insured loans. We focused on loans secured by California properties and that were in claim or default status as of February 12, 2009. Within this group, we identified a set of questionable loans originated by IndyMac that had been generated by Beechwood Incorporated. Beechwood is a company…

We reviewed alleged violations of U.S. Department of Housing and Urban Development (HUD) Federal Housing Administration (FHA) loan origination requirements by the subject. We concluded that the subject falsely certified to the truthfulness and accuracy of documents and information in mortgage loan applications on FHA-insured loans. The Department of Justice filed a complaint under the Financial Institutions Reform, Recovery, and Enforcement…

We reviewed alleged violations of U.S. Department of Housing and Urban Development (HUD) Federal Housing Administration (FHA) loan origination requirements by the subject. We concluded that the subject made false statements on a mortgage loan application for one property, and falsely acted as the seller of a second property on behalf of another person. The Department of Justice filed a complaint under the Financial Institutions Reform,…

We audited the Housing Authority of the County of San Bernardino’s American Recovery and Reinvestment Act of 2009 Public Housing Capital Fund formula and competitive grants. We performed the audit because Recovery Act reviews are part of the Office of Inspector General’s (OIG) annual plan and the Los Angeles Office Public Housing’s 2011 risk assessment rated the Authority as high risk based on data from the Authority’s most recent Real Estate…

We audited the Tule River Indian Housing Authority in response to a complaint involving the Authority’s alleged misuse and improper procurement of $303,721 in Recovery and Reinvestment Act of 2009 Native American Housing Block Grant funding to be used for cabinet construction work on 38 of its housing units. Our overall objective was to determine whether the Authority followed procurement and contracting requirements and used its Recovery Act…

We audited the City of Compton’s (City) HOME Investment Partnerships Program (HOME) in response to a citizen complaint generally alleging misuse of HOME funds by the Community Redevelopment Agency (subrecipient) administering the program, including allegations stating that more than $4 million in HOME funds was missing and that program objectives were not met. Our audit objective was to determine the validity of the complaint allegations,…

We completed an audit of the Housing Authority of the County of Monterey’s (Authority) administration of more than $2.9 million in Capital Fund Recovery Grant funding as part of the American Recovery and Reinvestment Act of 2009. Our objective was to determine whether the Authority administered the procurement and contracting of its grant funds in accordance with HUD laws and regulations. The Authority did not administer the procurement and…