The U. S. Department of Housing and Urban Development (HUD) Office of Inspector General (OIG) performed an audit of Gold Financial Services, Inc. (Gold Financial), a Federal Housing Administration (FHA) direct endorsement lender and a branch of AmericaHomeKey, Inc., in San Antonio, TX. We selected Gold Financial for audit because its default rate was almost 10 percent for the audit period while the average default rate in the San Antonio area…

We reviewed 20 Federal Housing Administration (FHA) loans Alethes, LLC (Alethes), underwrote as a FHA direct endorser. Our review objective was to determine whether Alethes underwrote the 20 loans in accordance with FHA requirements. This review was part of Operation Watchdog, an Office of Inspector General (OIG) initiative to review the underwriting of 15 direct endorsement lenders, at the suggestion of the FHA Commissioner. The Commissioner…

As part of our strategic plan objective to assist the U. S. Department of Housing and Urban Development’s (HUD) efforts to reduce rental assistance overpayments, we audited the Housing Authority of the City of Odessa’s (Authority) Section 8 Housing Choice Voucher (Voucher) and Section 8 New Construction (New Construction) programs. Based on review of the Authority’s financial statements, we also audited its transactions with one of its related…

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General, audited the State of Kansas' (State) Neighborhood Stabilization Program I (NSP I). Our audit objectives were to determine whether the State properly obligated its NSP I funds and to determine whether the State's contracts contained all of the required provisions. We concluded the State improperly obligated more than $12 million of its NSP I funds…

We reviewed 19 Federal Housing Administration (FHA) loans Americare Investment Group (Americare) underwrote as an FHA direct endorsement lender. Our review objective was to determine whether Americare underwrote the 19 loans in accordance with FHA requirements. This review is part of Operation Watchdog, an Office of Inspector General (OIG) initiative to review the underwriting of 15 direct endorsement lenders at the suggestion of the FHA…

We reviewed 20 Federal Housing Administration (FHA) loans that Alacrity Lending Company (Alacrity) underwrote as an FHA direct endorsement lender. Our review objective was to determine whether Alacrity underwrote the 20 loans in accordance with FHA requirements. This review is part of Operation Watchdog, an Office of Inspector General (OIG) initiative to review the underwriting of 15 direct endorsement lenders at the suggestion of the FHA…

We audited the U. S. Department of Housing and Urban Development (HUD) Community Development Block Grant (CDBG), Supplemental II Disaster Recovery program, funds, administered by the Texas Department of Housing and Community Affairs (TDHCA). Specifically, we wanted to determine whether TDHCA followed Federal and State of Texas (State) regulations in procuring the program management firm to administer the Housing Assistance and Sabine Pass…

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General, audited National Bank of Kansas City (National Bank). Our audit objectives were to determine whether National Bank followed Federal Housing Administration (FHA) requirements for (1) borrower eligibility and creditworthiness and property eligibility when underwriting loans and (2) implementing a quality control program. National Bank did not follow HUD…

We audited the Georgetown Housing Authority (Authority) due to a congressional request. Our objectives were to determine (1) whether the Authority and/or its nonprofit affiliates used U. S. Department of Housing and Urban Development (HUD) funding for recent developments and if so, whether they followed HUD regulations and (2) whether the Authority used HUD funds only for eligible expenditures. The Authority’s nonprofit related entities did not…

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General audited the Kansas City, Kansas Housing Authority (Authority) to determine whether the Authority violated HUD’s waiting list rules when it offered Section 8 vouchers to applicants for Delaware Highlands Assisted Living. We conducted the audit because of concerns raised during a previous audit of the Authority, in which we saw indications that the Authority…

As part of our organization’s commitment to ensure the proper use of recovery funding, we performed a review of the City of Grand Prairie’s (City) operations to evaluate its capacity to administer the $3.2 million received under the Housing and Economic Recovery Act of 2008 and the American Recovery and Reinvestment Act of 2009 (Recovery Act). Specifically, our objective was to review and assess the City’s capacity and risks in the following…

As part of the Office of the Inspector General’s (OIG) directive to determine whether safeguards exist to ensure that American Recovery and Reinvestment Act of 2009 (Recovery Act) funds are used for their intended purposes, we conducted a capacity review of the City San Antonio, TX (City) operations. Our objective was to determine whether the City had the capacity to account for Recovery Act funds and the controls to ensure that it expends…

As part of the Office of the Inspector General’s (OIG) directive to determine whether safeguards exist to ensure that American Recovery and Reinvestment Act of 2009 (Recovery Act) funds are used for their intended purposes, we audited the Dallas Housing Authority’s (Authority) Recovery Act Public Housing Capital Fund formula grant (grant). Our objective was to evaluate the Authority’s capacity in the areas of internal controls, eligibility,…

The U. S. Department of Housing and Urban Development’s Office of Inspector General (HUD OIG) audited the Housing and Urban Development (HUD) Community Development Block Grant (CDBG), Supplemental I and II Disaster Recovery program funds, administered by the Texas Department of Housing and Community Affairs (TDHCA). Specifically, we wanted to determine whether TDHCA administered the floodplain management program as required by federal, state,…

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General audited the development activities of the Kansas City, Kansas, Housing Authority (Authority) to determine whether the Authority improperly spent federal public housing funds when developing and operating nonfederal developments. We conducted the audit because of a citizen complaint received by our office. We concluded that the Authority inappropriately…

The City of Fort Worth (City) is scheduled to receive $10.85 million in Recovery Act funding. The Department of Housing and Urban Development (HUD) Office of Inspector General (OIG) issued a memorandum on the City’s capacity to administer these funds. We reported the City had a history of failing to meet regulatory requirements in an efficient or timely manner. The City needs to strengthen its capacity to adequately administer recovery…

We audited the Housing Authority of Travis County (Authority) due to several problem indicators including the U. S. Department of Housing and Urban Development’s (HUD) rejecting the Authority’s 2005 and 2006 audited financial statements and noting that the Authority’s 2007 financial statements contained $4.1 million in interprogram transfers and a negative $579,783 administrative fee reserve. Our objectives were to determine (1) whether the…

The Department of Housing and Urban Development (DHUD) Office of Inspector General has issued a memorandum on the Travis County (Texas) Housing Authority’s (Authority) capacity to administer Recovery Act funds. The memorandum reports that the Authority lacks capacity to administer ARRA public housing capital funds. The OIG recommended that HUD increase monitoring and oversight of the Authority’s financial and program activities, and either…

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General, audited Milestone Management Services, Inc. (Milestone), of Topeka, Kansas, in response to a request from the HUD's Office of Multifamily Housing in Kansas City, Kansas. HUD was concerned that Milestone had not complied with cash management requirements. Our audit objective was to determine whether Milestone complied with HUD’s cash management…