Information System Control Weaknesses Identified in the Loan Accounting System
We reviewed the general and application controls over the U.S. Department of Housing and Urban Development’s (HUD) Loan Accounting System (LAS) as part of the internal control assessments required for the fiscal year 2014 financial statement audit under the Chief Financial Officer’s Act of 1990. Our objective was to review the effectiveness of general and application controls over LAS for compliance with HUD information technology…
December 08, 2014
Report
#2015-DP-0004
Final Civil Action: SunTrust Mortgage, Inc., Settled Allegations of Failing To Comply With HUD’s FHA Loan Requirements
We assisted the U.S. Department of Justice (DOJ) in conducting an investigation of SunTrust Mortgage, Inc.’s underwriting practices for Federal Housing Administration (FHA)-insured loans.
On June 17, 2014, DOJ and the Consumer Financial Protection Bureau, along with 49 State attorneys general and the District of Columbia’s attorney general, filed suit against SunTrust for misconduct related to the origination and servicing of single-…
December 08, 2014
Memorandum
#2015-PH-1802
HUD Did Not Always Follow Applicable Requirements or Use Best Practices in the Procurement and Administration of Its Multifamily Servicing Contract
We audited the U.S. Department of Housing and Urban Development’s (HUD) procurement and administration of its multifamily mortgage loan and property management servicing and accounting contract. We conducted this review based on concerns communicated to the HUD Office of Inspector General (OIG) by the Federal Housing Commissioner and HUD housing officials. The objectives of the audit were to determine whether HUD officials (1)…
December 01, 2014
Report
#2015-NY-0001
Federal Information Security Management Act (FISMA) Fiscal Year 2014 Evaluation Report
The Federal Information Security Management Act of 2002 (FISMA) directs the Office of Inspector General (OIG) to conduct an annual evaluation of the U.S. Department of Housing and Urban Development (HUD) 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…
November 13, 2014
Report
#2014-OE-0003
Audit of the Federal Housing Administration’s Financial Statements for Fiscal Years 2014 and 2013
In accordance with the Chief Financial Officers Act of 1990 (Public Law 101-576), as amended, OIG is responsible for the conduct of the annual financial statement audit of FHA. Our work includes the audit of FHA’s balance sheets as of September 30, 2014 and 2013, and the related statements of net costs and changes in net position, the combined statements of budgetary resources for the years then ended, and the related notes to the…
November 13, 2014
Report
#2015-FO-0001
Information System Control Weaknesses Identified in the FHA Subsidiary Ledger
We reviewed the general and application controls over the Federal Housing Administration’s subsidiary ledger as part of the internal control assessments required for the fiscal year 2014 financial statement audit under the Chief Financial Officer’s Act of 1990. Our objective was to review the effectiveness of general and application controls over the subsidiary ledger for compliance with the U.S. Department of Housing and Urban…
November 06, 2014
Report
#2015-DP-0003
Information System Control Weaknesses Identified in the Ginnie Mae Financial Accounting System
We reviewed the information security controls over the U.S. Department of Housing and Urban Development’s (HUD) Ginnie Mae Financial Accounting System (GFAS) as part of the internal control assessments required for the fiscal year 2014 financial statement audit under the Chief Financial Officer’s Act of 1990. Our audit objective was to determine the effectiveness of general and application controls over GFAS for compliance with HUD…
October 29, 2014
Report
#2015-DP-0002
Information System Control Weaknesses Identified in the Single Family Housing Enterprise Data Warehouse
We reviewed the general and application controls over the Federal Housing Administration's (FHA) Single Family Housing Enterprise Data Warehouse as part of the internal control assessments of FHA’s principal financial statements for fiscal year 2014. Our objective was to determine the effectiveness of general and application controls over the data warehouse for compliance with HUD information technology policies and Federal information…
October 21, 2014
Report
#2015-DP-0001
Final Civil Action, Wells Fargo Bank, NA, Lender Settled Alleged Violations of Home Equity Conversion Mortgage Program
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 the same time. We…
October 21, 2014
Memorandum
#2015-PH-1801
Final Civil Action: U.S. Bank Settled Allegations of Failing To Comply With HUD’s FHA Loan Requirements
The U.S. Department of Housing and Urban Development’s (HUD), Office of Inspector General (OIG), in conjunction with the Department, the U.S. Department of Justice, and the U.S. Attorney’s Offices for the Eastern District of Michigan and Northern District of Ohio, conducted a joint investigation of U.S. Bank National Association’s (U.S. Bank) loan originations, underwriting practices, and quality control program for Federal Housing…
September 30, 2014
Memorandum
#2014-CH-1801
The HUD Office of the Chief Financial Officer Had Not Always Implemented Its User Fee Policy
The U.S. Department of Housing and Urban Development – Office of Inspector General audited HUD’s fiscal year 2013 compliance with the user fee requirements in Office of Management and Budget Circular A-25 and the Chief Financial Officers (CFO) Act of 1990. We initiated the audit based on observations in our audit of the Federal Housing Administration (FHA) annual lender renewal process (Audit Report No. 2010-KC-0002, issued August 6, 2010…
September 30, 2014
Report
#2014-KC-0006
Memorandum Report on the Office of Inspector General’s Internal Audit of HUD’s Single Family Seven-Loan Limit
The U.S. Department of Housing and Urban Development – Office of Inspector General audited HUD’s Federal Housing Administrations single family mortgage seven-loan limit. We initiated this review based on issues identified in an audit of the Wyoming Housing Opportunities Association in memorandum 2013-DE-1801. Our objective was to determine the impact of investor loan properties on the FHA fund.
We found multiple instances of…
September 30, 2014
Memorandum
#2014-KC-0801
HUD Did Not Always Provide Adequate Oversight of Its Property-Flipping Waiver Requirements
We audited the U.S. Department of Housing and Urban Development’s (HUD) oversight of property flipping as part of the activities in our fiscal year 2013 annual audit plan, which includes contributing to the protection of the integrity of housing insurance and guarantee programs. Our audit objective was to determine whether HUD had adequate oversight of its property-flipping waiver.
HUD did not always (1) ensure that lenders complied with…
September 30, 2014
Report
#2014-CH-0001
HUD Policies Did Not Always Ensure That HECM Borrowers Complied With Residency Requirement
We audited the U.S. Department of Housing and Urban Development’s (HUD) oversight of its Home Equity Conversion Mortgage (HECM) program based on our strategic goal to improve the integrity of HUD’s single-family insurance programs and because of residency issues identified in prior audits of the HECM program. Our objective was to determine whether HUD’s Office of Single Family Housing had effective controls to ensure that HECM loan…
September 30, 2014
Report
#2014-PH-0001
Lenders Generated $428 Million in Gains From Modifying Defaulted FHA Loans
The U.S. Department of Housing and Urban Development’s (HUD), Office of Inspector General reviewed HUD’s Federal Housing Administration (FHA) loss mitigation program. We initiated this audit due to our concern that FHA might have incurred costs while allowing lenders to make large amounts of money by modifying defaulted FHA-insured loans. Our audit objective was to determine the extent to which loans modified under the FHA program…
September 24, 2014
Report
#2014-KC-0004
HUD Did Not Always Enforce the Requirements of the Regulatory Agreements and HUD Handbooks Pertaining to Owner Advances and Distributions
The U.S. Department of Housing and Urban Development – Office of Inspector General audited HUD’s Office of Multifamily Housing Programs, based on an internal audit suggestion expressing concern that multifamily property owners took unauthorized distributions or owner advances with no consequence. Our audit objective was to determine whether HUD enforced the requirements of the regulatory agreements and HUD handbooks that pertain to owner…
September 17, 2014
Report
#2014-KC-0003
Asset Repositioning Fees for Public Housing Authorities with Units Approved for Demolition or Disposition Were Not Always Accurately Calculated
We audited the U.S. Department of Housing and Urban Development’s (HUD) process for awarding asset repositioning fees (ARF) to public housing agencies (PHA) with approved demolition and dispostion projects. We initiated this review based upon issues disclosed during our review of Public Housing Capital Fund program grants to PHAs with approved demolition and dispostion projects. The audit objective was to determine whether HUD had…
September 04, 2014
Report
#2014-NY-0003
HUD’s ONAP Lacked Adequate Controls Over the ICDBG Closeout Process
We audited HUD’s Office of Native American Programs’ (ONAP) Indian Community Development Block Grant (ICDBG) program grant closeout process based on data received from Southwest ONAP and additional analysis that raised concerns regarding ONAP’s oversight of the grant closeout process. Our objective was to determine whether ONAP had adequate controls to ensure the timely closeout of program grants.
HUD’s ONAP did not have adequate controls…
August 19, 2014
Report
#2014-LA-0006
HUD Did Not Always Recover FHA Single-Family Indemnification Losses and Ensure That Indemnification Agreements Were Extended
We audited HUD’s controls over its Federal Housing Administration (FHA) loan indemnification recovery process based on the OIG’s analysis of HUD data that indicated indemnification losses were not always recovered for FHA single-family loans. Our objective was to determine whether HUD had adequate controls in place to monitor indemnification agreements and recover losses on FHA single-family loans.
HUD did not always bill lenders for FHA…
August 08, 2014
Report
#2014-LA-0005
Final Civil Action Borrower Settled Alleged Violations of Home Equity Conversion Mortgage Program
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 the same time. We…
July 30, 2014
Memorandum
#2014-PH-1805