Site Owner Received Improper Section 8 Housing Assistance Payments

HUD’s Office of Inspector General (OIG) audited the Section 8 housing assistance payments program of a site in Kansas City, Mo. Auditors found that the owner’s management agent didn’t properly verify tenant eligibility, requested subsidies for ineligible tenants and tenants not living in units, didn’t retain tenant files, didn’t properly collect and deposit rents, and had unreported tenants living in the units. As a result, it received $144,556 in ineligible and $726,399 in unsupported housing assistance payments and couldn’t account for at least $16,687 in project rents owed by tenants.

Auditors recommended that HUD require the owners to repay $144,556 in housing assistance for tenants who were not eligible for assistance or not living in units, support or repay $726,399 in housing assistance payments based on missing or incomplete tenant files, support that $16,687 in tenant rents was collected and deposited or repay the project, obtain independent management, and conduct a review to determine who currently lives in the units and verify their eligibility. In addition, auditors recommended that HUD monitor the site to ensure that it properly maintains its tenant files, completes the required annual recertifications, and properly supports disability exemptions.

• HUD Audit 2017-KC-1002, March 2017