HUD Staffer Goes Crazy With Your Money


During the government shutdown a couple of years ago, an employee at a cabinet-level agency long embroiled in scandal fraudulently charged thousands of dollars in personal items on his work-issued credit card.

Enraging as it may seem, it’s not all that surprising considering it involves the Department of Housing and Urban Development (HUD), a famously corrupt agency well known for a multitude of transgressions over the years. In this particular case a HUD staffer racked up nearly $12,000 on his agency credit card by charging personal items such as groceries, lodging, television cable, transportation and even prescription medications.

This occurred in the midst of the 2013 government shutdown caused by Congress’s failure to pass a spending bill. That paralyzed most functions of government, accounting for the second longest shutdown since 1980. The standstill caused a huge economic disruption and billions in lost output, according to a report published by the White House. Although federal employees were eventually compensated for the period of the shutdown, hundreds of thousands did not receive their full paychecks during that time. “The burden of delayed paychecks on federal workers and their families was significant and harmful,” the White House report states.

The HUD employee who went on a spending spree with his government credit card got busted but the agency didn’t bother to take action, according to the federal audit that exposed the scandal this month. The fraudulent purchases—$11,938 in total—were made during a relatively short period from August through October of 2013 so it was difficult for the agency not to notice. By January 2014 the fraud was confirmed but HUD failed to even reprimand the employee or report the wrongdoing. “This occurred because HUD’s existing purchase card policies did not include specific procedures to evaluate violations for purchase card program weaknesses and criteria to report violations,” the inspector general writes.

So, this bloated and notoriously corrupt agency gives its employees credit cards and has no measures to assess violations, which occur regularly throughout government. In this case the HUD staffer charged an astounding $7,357 in groceries, which raises red flags all on its own. He also charged $1,280 in drug stores and pharmacies and $488 on cable television for his home. The rest was spent on commuter transportation, hotels, restaurants and telecommunications equipment, according to the breakdown offered in the audit.

HUD’s scandals have been well documented throughout various administrations—both Republican and Democrat—and Judicial Watch has covered many of them. In fact, earlier this year JW reported that a HUD director who simultaneously ran a leftwing nonprofit changed agency policies to benefit her group. Her name is Debra Gross and for years she headed a crucial HUD policy office while she served as deputy director of a leftist organization called Council of Large Public Housing Authorities (CLPHA) that claims to work to “preserve and improve public and affordable housing through advocacy, research, policy analysis and public education.”

In 2011 a JW investigation found that the Obama administration violated the ban on federal funding for the Association of Community Organizations for Reform Now (ACORN) by giving the famously corrupt group tens of thousands of dollars in grants to “combat housing and lending discrimination.” The money, $79,819, flowed through HUD and clearly violated a law (Defund ACORN Act) passed by Congress in 2009 to stop the huge flow of taxpayer money that annually went to ACORN after a series of exposés about the leftwing group’s illegal activities.

Problems at the agency go way back. President George W. Bush’s HUD secretary, Alphonso Jackson, was ousted after the feds launched an investigation into his plots to enrich himself and his friends by giving them lucrative government contracts and Bill Clinton’s housing secretary, Henry Cisneros, pleaded guilty to lying to the FBI about payments to his former mistress. An influence-peddling scandal under Ronald Reagan led to the conviction of 16 people, including top aides to then HUD Secretary Samuel Pierce.

The motto of Judicial Watch is “Because no one is above the law”. To this end, Judicial Watch uses the open records or freedom of information laws and other tools to investigate and uncover misconduct by government officials and litigation to hold to account politicians and public officials who engage in corrupt activities.